Doctors Who Take Money from Drug Companies Prescribe More Expensive Drugs
Policy + Politics

Doctors Who Take Money from Drug Companies Prescribe More Expensive Drugs


When a doctor takes out his or her pad and writes a prescription, patients typically take it for granted that they are being guided towards the most effective medicine available for their problems, regardless of the price.

But a new study by ProPublica, the independent, non-profit news organization, discovered an intriguing finding: Doctors who receive payments from the pharmaceutical and medical device industries tend to prescribe brand-name medications far more than physicians who don’t accept payments, gifts or other honoraria.

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Moreover, the larger the payment, the more doctors tend to steer their patients to brand-name drugs instead of less expensive generic drugs that have essentially the same effect, the study found.

“Doctors who got money from drug and device makers—even just a meal– prescribed a higher percentage of brand-name drugs overall than doctors who didn’t, our analysis showed,” according to the report released on Thursday and authored by Charles Ornstein, Ryann Grochowski Jones and Mike Tigas. “Indeed, doctors who received industry payments were two to three times as likely to prescribe brand-name drugs at exceptionally high rates as others in their specialty.”

ProPublica reached this conclusion after comparing records on drug company and medical device manufacturers’ payments to doctors in 2014 with corresponding data on the types of medication that the physicians prescribed under the Medicare program for seniors.

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They found that physicians who received more than $5,000 from drug companies and others in 2014 for speeches, meals, consultations or other promotional activities “typically had the highest brand-name prescribing percentages.”

Among those doctors, the rate of brand name prescribing was about 30 percent, compared to just 20 percent for doctors who didn’t accept payments from the drug industry.

“Obviously when you’re sitting there with a patient, the patient expects their physicians to be prescribing  them the best drugs for them – or the best procedures or the device -- according to their best professional knowledge,” Dr. Aaron Kesselheim, associate professor of medicine at the Harvard Medical School, said in an interview Thursday. 

“And I think that when physicians have these sort of marketing relationships with pharmaceutical and medical device companies, I think that actually creates a conflict of interest,” he said.

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To be clear, there is nothing in ProPublica’s study to suggest that doctors are heavily influenced by industry payments to prescribe particular drugs or drugs from a particular company. And in fairness, most doctors would never consciously put profits ahead of their patients’ well-being.

However, the new analysis raises some troubling economic and ethical issues. And, for the first time, it demonstrates that there is a proven relationship between physicians receiving money from drug companies other than for research and the way that they prescribe drugs.

“Before, a lot of people would say that folks who get more payments are prescribing more brand-name drugs but you didn’t really have a lot of good evidence to support that,” explained Dr. Wallid Gellad, associate professor of medicine at the University of Pittsburgh and co-director of its Center for Pharmaceutical Policy and Prescribing, who reviewed the data for ProPublica.

While researchers have yet to make a causal connection between industry payments to doctors and their prescribing practices, “At least you can say that it is true that there’s an association between getting more money and prescribing more brand name drugs,” Gellad told The Fiscal Times.

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He cautioned that some doctors who receive large payments from pharmaceutical companies for their expertise may have practices with sicker or more challenging patients, and that those physicians might prefer to choose from a larger array of brand-name drugs. “That’s still possible, and you can’t rule out that’s what we’re seeing,” Gellad said.

With consumers, government agencies and policymakers in an uproar over the soaring cost of prescription drugs – especially biologic drugs for the treatment of cancer and the Hepatitis-C virus – any physician bias towards costlier brand name drugs can compound the economic problem.

According to the U.S. Food and Drug Administration, there is a huge difference between generic and brand name drugs when it comes to price. Indeed, the cost of a generic drug is on average 80 to 85 percent lower than a brand name product, an FDA fact sheet states. In 2010, for example, FDA-approved generics saved $158 billion – or an average of $3 billion a week. 

Just for the average patient purchasing prescription drugs for cardio-vascular disease, a generic anti-cholesterol medicine might cost no more than a $4 co-payment. But if the patient has to purchase a non-preferred brand drug, the co-payment could be as high as $60 to $80.

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Beyond that is the ethical question of whether – subconsciously or otherwise – doctors who favor brand name drugs over generic drugs are being influenced by their dealings with major pharmaceutical companies. While the AMA offers guidelines for doctors dealing with drug companies to protect their patients’ interests, doctors have wide latitude in contracting with drug companies to deliver speeches, provide testimonials for drugs and engage in other activities that sometimes will net them hundreds of thousands of dollars.

According to the ProPublica report, a handful of doctors who received substantial payments from industry and had above-average prescribing rates of brand-name drugs asserted they were acting in the best interest of their patients. “I do prefer certain drugs over the others based on the quality of the medication and also the benefits that the patients are going to get,” Dr. Amer Syed of Jersey City, N.J., told the investigative news organization.

Syed received more than $66,800 from companies in 2014 and his brand-name prescribing rate was more than double the rate of his colleagues in internal medicine. “My whole vision of practice is to keep the patients out of the hospital,” he said.

Holly Campbell, senior communications director for PhRMA, the drug industry’s chief lobby, said yesterday that many factors affect physicians’ prescribing decisions.

A 2011 survey she cited found that 91 percent of physicians felt that a great deal of their prescribing was influenced by their clinical knowledge and experience. That industry survey also found that factors such as a patient’s particular situation, including drug interactions and side effects, articles in peer-reviewed medical journals and clinical practice guidelines affected prescribing decisions a great deal.

“Working together, biopharmaceutical companies and physicians can improve patient care, make better use of today’s medicines and foster the development of tomorrow’s cures,” Campbell said in an email. “Manufacturers engage with physicians to keep them current on new indications for approved medicines, potential side effects of medicines, and both emerging benefits and risks of medicines. Physicians provide real-world insights and valuable feedback and advice to inform companies about their medicines to improve patient care.”

However, some medical experts seriously question the propriety of doctors trading on their experience and reputations to collect fat payments and fees from drug companies and medical devices manufacturers. And the latest ProPublica findings about the relationship between payments and prescribing practices only further fuels those concerns.

“I don’t think it means that every decision is necessarily driven one way or another or that all physicians who have these kinds of relationships do this sort of thing,” Kesselheim of the Harvard Medical School said in an interview.

“But I think that that kind of conflict of interest exists, and there’s been decades’ worth of data. And this [ProPublica study] is another large data point showing that those kinds of relationships are associated with changes in physicians’ prescribing behavior. That’s not something patients expect, and it’s potentially problematic in terms of the sort of trust that patients might have in their physicians.”