FTC Investigating Whether Drug Marketing Practices at Some Pharmacies Violate Consumer Privacy

The Federal Trade Commission has launched an investigation to determine whether pharmacies "improperly" use their customer lists to distribute promotional drug information paid for by pharmaceutical companies, the Wall Street Journal reports. The probe, which is in a "preliminary stage," is considering if the marketing practices violate federal false-advertising and medical privacy rules. According to the Journal, the letters and calls often endorse more expensive versions of a patient's current medication, and at times they promote drugs whose patents are about to expire and will soon face competition from less expensive generic drugs. In addition, the agreements between drug companies and pharmacies sometimes preclude the pharmacies from participating in similar programs for rival medications, including generics. "These letters pre-empt the patient-doctor relationship, predisposing patients to a more costly course of treatment before they have had a chance to speak with their doctors," Sen. Charles Schumer (D-N.Y.), who urged the FTC in May to investigate the practices, said. Schumer added that the practices are "deceptive" because the letters are sent on the pharmacy's letterhead, with only a small disclaimer at the bottom describing the role of the drug maker in the advertising pitch (Merrick et al., Wall Street Journal, 10/16). Of the large pharmacy chains being questioned by the agency, Rite Aid yesterday confirmed that it was being investigated but denied any wrongdoing, adding that the company is "cooperating with the probe," Bloomberg/Los Angeles Times reports. The Eckerd drug chain was investigated earlier this year to determine if customers were "adequately informed" that when they signed the prescription pick-up log and forms, they were also authorizing the release of information for marketing purposes. The investigation was settled in July (Bloomberg/Los Angeles Times, 10/16). In addition, Longs Drugs officials said they received a letter from the FTC requesting documents relating to its marketing, while a spokesperson for CVS said the company had not been contacted by the agency (Wall Street Journal, 10/16).