A new California bill aims to reduce the pharmaceutical industry’s influence in medical decision-making by restricting payments and gifts from drug companies to doctors and other medical providers.
State Sen. Mike McGuire (D-Healdsburg), who authored the bill, said that when drugmakers woo physicians with meals and other enticements they generate brand loyalty, which can raise health care costs and even compromise patient safety.
McGuire’s bill would limit drug company payments to health care providers — including cash and gifts of food, travel or entertainment — mostly to educational and scientific purposes, such as seminars.
“Financial incentives change minds,” said McGuire, who cited a news media report showing that doctors who accepted money or meals from the pharmaceutical industry were two to three times more likely to prescribe high-priced brand-name drugs than those who did not accept such benefits.
Brand-name drugs tend to be pricier than generic drugs, even though research shows they are not necessarily more effective.
The proposed measure would allow pharmaceutical companies to continue paying health care professionals for their work on clinical trials and other scientific research. And the industry could continue to sponsor educational events, as long as they were not for the purpose of promoting specific products.
Doctors would still be allowed to accept free drug samples and take up to $250-a-year’s worth of food paid for by companies. But drugmakers could be slapped with a $10,000 state fine if they give direct payments to doctors to promote their products.
Doctors can receive hundreds of thousands of dollars from drug companies, according to a ProPublica investigation. One New Hampshire nephrologist received more than a half-million dollars in speaking and consulting fees, and a Brooklyn-based psychiatrist prescribed much higher rates of brand-name drugs while receiving $53,400 from drug companies, according to ProPublica.
The Pharmaceutical Research and Manufacturers of America (PhRMA), the drug industry’s primary trade association, opposes McGuire’s measure, arguing that the legislation could compromise communication with companies that helps doctors stay up to date on medication safety and effectiveness.
Information provided by drugmakers “may inform a physician’s prescribing decisions as they weigh the best options for their patients,” said Holly Campbell, a PhRMA senior director for public affairs, in an emailed statement. “Collaboration between biopharmaceutical companies and physicians not only helps advance patient care, but is essential in the development of new treatments and diagnostics.”
Advocacy groups, including Consumers Union and Health Access, support the bill, saying it could lower drug costs by reducing incentives for doctors to prescribe higher-cost brand-name drugs when cheaper generic drugs are available.
A 2016 survey of more than 107,000 health care consumers showed that about $73 billion from 2010 to 2012 was spent unnecessarily on brand-name drugs in cases where generic medications were available.
The advocates also say cutting pharmaceutical industry ties with doctors will make patients safer because providers will be more likely to prescribe based on medical evidence.
A new study published in JAMA found that doctors at academic medical centers that have restricted financial ties to the pharmaceutical industry prescribed fewer medications promoted by drug companies.
Several states and the District of Columbia already restrict pharmaceutical gifts to health care providers, according to Sen. McGuire and medical education researchers.
California health care providers received more money from pharmaceutical companies in 2014-15 — about $1.4 billion — than their counterparts in any other state, according to ProPublica. But some health providers in California already ban company payments and gifts to their staff.
Kaiser Permanente, which covers more than 8 million Californians, does not allow employees involved in drug-buying decisions to accept gifts from the industry, and some physicians are restricted from accepting anything of value from the industry. (Kaiser Health News, which produces California Healthline, is not affiliated with Kaiser Permanente.)
The hospitals and clinics of the University of California-San Francisco does not allow faculty, staff or students to receive gifts from the industry.
“UCSF wishes to minimize such conflicts and to ensure to the best of its ability that all decisions regarding clinical care, research activities and educational content are unbiased and independent of outside influence,” according to its written policy.
The bill will next be heard in the Senate Appropriations Committee on Monday.