Is It Ethical for Drug Companies to Pay Off Doctors?

Posted by Enrique on 03.17.2010

Appearance of impropriety



In the late 90's, the Food and Drug Administration issued a rule change that made it legal for pharmaceutical companies to advertise their products on television. And so began the Era of Amusing Disclaimers, where 75% of the typical prescription drug ad is devoted to telling us not to buy it. For the rest of my life I'll be haunted by the idea of having a four-hour erection, and having to explain to the hospital ER personnel I'm actually not happy to see them. *rimshot*

Traditional advertising is just one method Big Pharma employs when marketing its products. Sometimes drug companies pay doctors directly to endorse their wonder-pills. Not that there's anything wrong with that. Or is there?

The story so far…

Earlier this week, my hometown newspaper ran a lengthy feature story with the lengthy headline "As universities tighten ethics policies, drug firms turn to private physicians to promote products." It's actually quite an impressive piece of work by reporter John Fauber, and deserves a lengthy excerpt:

When looking for a doctor to travel the country and tout its costly prescription fish oil pill, GlaxoSmithKline didn't select a heavyweight university researcher.

Instead, it wrote checks to Tara Dall, a Delafield primary-care doctor who entered private practice in 2001.

For just three months of speaking engagements last year, GlaxoSmithKline paid Dall $45,000, ranking her among the most highly paid of more than 3,600 doctors nationwide who spoke for the company, which released records for only one quarter of the year. […]

For years, drug companies sought out influential university doctors with impressive credentials to bring their message to other doctors and persuade them to write prescriptions for their products.

But companies have been forced to back away from that approach as a growing number of medical schools, including the University of Wisconsin-Madison, have developed conflict-of-interest policies that ban such talks.

So much money is at stake that in January one academic doctor resigned his job at Harvard rather than give up his speaking income.

The problem: While medical schools can restrict biased speaking and require doctors to fully inform patients of their ties to drug companies, there are no such restrictions or requirements on private doctors.

The story also notes Big Pharma is only now revealing its endorsement deals with doctors under threat of regulation by U.S. Senator Herb Kohl, who has introduced a bill that would compel such disclosures. Apparently, some doctors are inconsistent about telling their patients they have side jobs as drug company shills. On its face, this appears to be an example of government intervention that achieved a positive outcome. Bloody hell, that can't be right…

I do recall a few years ago I saw a dermatologist for a regrettable fungal affliction I had at the time (but I'm feeling much better now). He prescribed a drug for me, and I must admit it didn't occur to me to ask if he had any financial connection to the manufacturer of the drug. I'll have to keep that in mind next time I seek healthcare services, but if it happens my doctor conveniently forgot to tell me he earns thousands of dollars a year endorsing the drug he prescribed for me, I'd be none the wiser. Of course, I wouldn't have much reason to complain either, since the drug cleared my fungal problem right up. Now my toenails are fabulous, I assure you.

As far as I'm aware, many private businesses have conflict of interest policies published in their employee handbooks. (I would guess those policies are substantively the same as University of Wisconsin's.) Fauber's article says the number of medical doctors on drug company payrolls may be over 10,000. Even if we assume every single one of them don't properly disclose conflicts of interest to patients, that would be less than 2% of the physician workforce (according to government data, anyway). It doesn't seem to be much of a problem. Still, I should note if one were to argue the Kohl bill represents a rare case of government interference with non-disastrous consequences, one might have a point. You're welcome.

I think most of us would agree professionals should disclose conflicts of interest to their clients. And I expect the vast majority of professionals would offer such disclosures voluntarily as a matter of customer service. Patients won't see a doctor they can't trust, so it's in the doctor's best interest to operate ethically. When consumers have many options to choose from, markets punish unethical behavior (unlike governments, which reward unethical and/or irresponsible behavior with bailouts). Other than the conflict of interest question, I don't see anything wrong with doctors being contracted by drug companies. I'm a big supporter of an individual's right to pursue the highest salary/compensation/income he or she is capable of earning.

Another concern raised in Fauber's article is doctors speaking on behalf of drug companies "can be biased and contribute to spiraling health care costs by promoting the use of expensive brand-name drugs over generics." Insured patients are likely to choose brand-name drugs, because a third-party is paying the majority, if not the entirety, of the cost. And the difference in cost is considerable. GlaxoSmithKline's fish oil pill runs a couple thousand dollars, while generics only cost a few hundred. But if we're concerned about the exorbitant cost of prescription drugs, we would be best served by reforming the FDA drug approval process.

On a recent episode of his Fox Business Network show, libertarian heartthrob John Stossel pointed out the FDA red tape for new drugs and surgical implants can cost tens of millions of dollars and take more than a decade. Those costs are naturally passed on to consumers. In view of this hulking government bureaucracy that creates massive expenses, Stossel asked, why not make the FDA process voluntary? So-called dietary supplements aren't subject to FDA approval, and many are marketed with the disclaimer "these statements have not been approved by the FDA." Why not apply the same standard to pharmaceuticals?

If adults prefer the expensive FDA-approved drugs, they can have them. Other adults may choose differently. On Stossel's show, his audience expressed concern that the average layperson isn't capable of informing him/herself about pharmaceuticals. That's nonsense. Anyone considering a major purchase – whether it be an automobile, a house, or a life-altering drug – is going to thoroughly investigate their options. Those of us who have bought a car or house understand that. It would be the same for drugs, if the FDA process were voluntary. Just as private firms Edmunds and Carfax provide assistance to car buyers, resources for pharmaceutical consumers would enter the market. The only reason they don't exist now is the FDA holds a QA monopoly.

In the meantime, drug companies that are subject to intrusive regulation by the FDA and other government agencies will have to find creative ways to inform the public about their allegedly fine products. If we're squeamish about Big Pharma paying off doctors, we should first address the root causes at the FDA.

Now if you'll excuse me, I have to send John Fauber a fruit basket…