Internal Drug Company Memos Indicate Giving Gifts to Doctors an Effective Marketing Tactic

Adding to the controversy surrounding pharmaceutical companies' gifts to physicians, sales representatives for TAP Pharmaceuticals, which last year paid a record fine for illegal marketing practices, said that presenting food and "small gifts" to physicians was effective in increasing their company's drug sales, according to internal company documents, the Boston Globe reports. The documents, filed in an ongoing criminal investigation of the drug company's sales practices, showed how TAP sales representatives used such things as free food and items bearing the TAP logo to secure personal meetings with doctors to discuss the company's products (Murphy, Boston Globe, 11/17). In October 2001, TAP, a joint venture between Abbott Laboratories and Takeda Chemical Industries, settled a Medicare and Medicaid fraud case for $875 million, one of the largest criminal fines imposed by the government for health care fraud. Under a settlement with federal prosecutors, TAP pleaded guilty to a charge of conspiracy to violate the Prescription Drug Marketing Act and settled civil cases with the federal government, the 50 states and the District of Columbia (Kaiser Daily Health Policy Report, 10/4/01). Both the American Medical Association and the Pharmaceutical Research and Manufacturers of America recently have adopted guidelines for gift giving, but drug companies continue to offer physicians "freebies and fancy-dinner invitations," the Globe reports. The AMA guidelines allow for "modest meals" that are shared during informational meetings and for gifts valued at less than $100 that "benefit patients," but the guidelines are voluntary. Dr. Charles Welch, president of the Massachusetts Medical Society, said, "There's problem behavior on both sides of this relationship. What we're concerned about is that some clinicians are willing to participate in not just accepting significant gifts, but also participating in bonus programs and other kinds of things which clearly are influencing their choice of drugs." TAP spokesperson Kim Modory said the company, in its settlement with the federal government, implemented mandatory ethics training for all sales representatives. Still, Welch said that the practice of gift giving will likely continue until there are penalties "for the people who offer these arrangements, and the people who accept them" (Boston Globe, 11/17).

Federal Enforcement Needed
Marketing practices such as those employed by TAP Pharmaceuticals illustrate that industry gift-giving guidelines are "clearly insufficient" and "stronger federal guidelines" are needed, according to a Boston Globe editorial. Although drug representatives provide "occasionally helpful advice," their "bigger impact" is driving up drug costs, according to the Globe. In 2001, drug companies spent $19.1 billion on marketing and promotion, compared with $30.3 billion for research and development, according to an independent industry database. HHS last month released draft guidelines for drug marketing, but many patient advocates found the rules to be "vague and unenforceable," the Globe writes. The editorial concludes, "Tougher guidelines, combined with more prosecutions like the TAP case, are the best hope for curbing industry profiteering" (Boston Globe, 11/17).

Case Study
The Boston Globe Magazine on Nov. 17 examined AstraZeneca's heartburn medication Nexium, which could be the "best case study of the forces driving up prescription drug costs." Nexium is intended to be the next generation replacement for AstraZeneca's heartburn medication Prilosec, a drug that brought in annual sales of $6 billion. Prilosec's patent expired more than a year ago, and "under normal circumstances," a generic version of the drug would now be available, the Globe reports. Instead, lawsuits have "ke[pt] the generics at bay," and AstraZeneca has launched a $500 million "marketing blitz" attempting to transfer Prilosec patients to Nexium, "which even [AstraZeneca's] studies show to be barely more effective than" Prilosec (Swidey, Boston Globe Magazine, 11/17).