Eli Lilly To Disclose Payments To Doctors
13 CommentsBy Ed Silverman // September 24th, 2008 // 7:48 am
In doing so, Lilly becomes the first drugmaker to report how much money is paid to individual docs for consulting, speeches and other activities, the Associated Press reports. The move comes four months after Lilly decided to support a watered-down version of the Physicians Payments Sunshine Act, which would establish a national registry of such payments by drug and device makers (back story).
The disclosure will begin in the second half of 2009, and cover payments made in the first half of the year, but Lilly won’t report payments from 2008 or earlier, noting the Sunshine Act doesn’t require such disclosure. Later on, Lilly will expand disclosure to include travel, gifts and entertainment, which the bill would require to be made public. For now, Lilly will create an Internet database listing payments and its registry will be updated annually. (Lilly statement)
“We’ve learned that letting people see for themselves what we’re doing is a good way to restore trust,” Lilly ceo John Lechleiter tells the AP, adding that docs who advise the drugmaker or speak at conferences about treating patients take time away from their medical practice. That’s why they need to be compensated at fair, market rates. “We’re oftentimes taking them away from their practice for a day or more. It’s a service that they’re providing and they deserve compensation for that.”
Critics, however, say docs are influenced by payments in their treatment decisions and this can drive up medical bills. Although most docs believe that free lunches or trips have no effect on their medical judgment, research has shown that these type of payments can affect how people act.
“The ethical handwriting is on the wall. Disclosure is coming. States are pushing for it, and once a few states do, it’s hard to imagine the federal government won’t line up behind,” Arthur Caplan, who heads the Center for Bioethics at the University of Pennsylvania, tells the AP. “I think that’s a good thing because we have a great deal of empirical evidence that gift giving can influence behavior in terms of prescriptions, publishing positive findings but suppressing negative findings, and generating enthusiasm for new drugs.”
A handful of states and Washington DC have disclosure laws for payments from drugmakers to docs. Those states are Minnesota, Vermont, West Virginia and Maine, but none require disclosure of payments from medical device makers.
Peter Lurie, deputy director of the health research group at Public Citizen, tells the AP that state laws can let patients know when their doctors have a connection to a drug firm, but the state laws are not working very well. The laws have various exemptions and sometimes don’t even disclose the information to the public.
In the past two years, the House and Senate introduced bills requiring drug and device makers to disclose any payments to doctors exceeding $25, but the industry balked. Lilly had announced earlier that it intended to comply with key aspects of the legislation once some lawmakers in the Senate agreed to a higher reporting threshold of $500.
Trade groups representing docs, such as the American Medical Association, agreed to support the legislation once it included the higher, $500 threshold. In a letter to lawmakers, the groups said the disclosures would “enhance the medical profession’s ability to provide oversight and strengthen our ability to serve as stewards of medicine.”
Lurie, however, is skeptical Lilly’s announcement represents a step forward on the issue of more transparency in health care. “There are dozens of pharmaceutical companies. This is just one of them. Most won’t follow this guideline at all, and there will be no enforcement,” Lurie tells the AP. “This is Ely Lilly’s attempt to forestall the federal legislation by saying we’re in effect complying anyway.”
Public Citizen also objects to the $500 threshold for reporting. Lurie says it should be much lower - $25 per gift. “Most of what will wind up being disclosed is speaker’s fees, consulting and research grants,” Lurie tells the AP. “But most people want to know more than that. They want to know about meals, travel and that sort of thing. A lot of people will be cut out by the $500 annual limit.”
However, Chuck Grassley, the Iowa Republican on the Senate Finance Committee, who co-sponsored the Sunshine Act, applauded Lilly’s announcement, although he plans to continue his push for legislation requiring disclosure of physician payments by drug and device makers.
“Consumers and taxpayers deserve a federal requirement that applies to all kinds of payments to physicians in every state in the nation,” Grassley tells the AP. His bill calls for penalties of $1,000 to $5,000 for failure to report a payment, with an annual cap of $250,000 for knowingly failing to report. The legislation would pre-empt state reporting requirements.
Ken Johnson, PhRMA’s senior vp, says payments to physicians are an important part of the effort to inform health care providers about such things as new treatment options, appropriate dosing and potential interactions with other drugs. “We believe that improving transparency in such interactions is a laudable, but complex, goal,” Johnson tells the AP. “Any steps toward transparency should be structured in a way that would not chill these important exchanges.”
Justice in MI
Help me out here. Wasn’t such disclosure at the core of Lechleiter’s threat to pull out of Massachusetts?
Or is this something else?
There were a lot of people dressed up as native Americans ready to throw Zyprexa into Boston Harbor, so clarification appreciated.
Ed Silverman
Hi Justice,
The issue in Massachusetts is actually more about clinical trial work…
http://www.pharmalot.com/2008/08/pharma-threaten-massachusetts-over-new-bill/
And Lechleiter isn’t saying payments will end.
Regards
ed
harpy
Interesting - Lilly’s hometown newspaper says, “In 2011, Lilly plans to expand the database to include payments, updated annually, for clinical research and other provisions called for in the Physician Payments Sunshine Act pending in Congress.”
I guess the issue in Massachusetts is that Lilly wants to do it on its own terms. But, I notice Lilly won’t be disclosing the extras - gifts, meals, lodging, etc.
Another thing that stands out to me after rereading Ed’s previous post - why did pharma fight so hard to get the gift ban taken out of the Massachusetts law and turn around and ban gifts (excepting educational items) in the new PhRMA Code? Is it a question of control?
harpy
Oops! Forgot to source my quote.
Dan A.
Will they have any money to pay doctors after thier lawsuits?
Erik
Guess they’ll start laundering the payoffs to the docs through the CME companies.
Justice in MI
There goes Harpy, thinking again. Watch yourself.
Re: this question: “why did pharma fight so hard to get the gift ban taken out of the Massachusetts law and turn around and ban gifts (excepting educational items) in the new PhRMA Code? Is it a question of control?”
Whatever it is, we’ve seen the pattern numerous times. For example, the FDAAA was going to include a two-year ban on DTC for new drugs. Bill Frist, among others, supported it, Pharma and allies fought it, and it was removed.
Then the Energy Committee - Dingell, Stupak, et. al. - revisited the issue. Shortly thereafter, PhRMA came up with a six month “voluntary” DTC black-out period.
I’m all for positive self-regulation. But these seem to be cases of “good will offensives,” control (fighting larger fire with smaller fire), and creating bargaining chips if needed.
harpy
Sorry, Justice. Would you believe I even went to public schools?
In looking at it again - the major difference is that the PhRMA Code is voluntary and, unlike Britain’s PMCPA, it has no teeth. There are no consequences for breaking the code, but a $5,000 fine for each infraction of the Mass. law. So it seems PhRMA agrees in principle with the gift ban, they just don’t want to be held to it. Similar to the fight over CME.
Justice in MI
Ha. I also went to “public school” (which I think is the same as what we Yanks call “private school.”)
It is hard to get over the habit of thinking, but we must do our best to support the FDA’s omniscience on all things pharmaceutical. And try not to worry our little heads about it.
Once preempted, twice shy.
What you write about “teeth” has teeth - so many that I will try to forget I ever heard it.
Reality
Are they going to list “consultant” payments, ‘advisory board” honoraria, and the like? Now these figures would be very interseting, with many well-known docs making hundreds of thousands a year on this stuff. I know harvard wouldn’t be happy to see this come about. Some of their people would be right at the top!
commentator
Because the folks in the pharmaceutical business actually think the patients are their “products”.
Therefore any attempt to educate them and allow them to be “pro active” in their quest for informed consent, actually interferes with Pharma’s ability to increase their market share and well, do business.
I can’t think of any other job one could have that allows you to earn upwards of 500K a year and supplement that with “payola” in the form of speakers fees, free trips, etc.
Hopefully consumers will dis-credit any study authored by doctors on “payola”. Now, if the FDA would only accept studies where each of the P.I. actually got an unencumbered look at the raw data, we might actually start to see some improvements….
harpy
Sorry again, Justice. I’m a Yank, too. I just read too much, and I’m fond of British slang.
kudzu fire
about time