Industry-to-Physician Marketing and the Cost of Prescription Drugs

I share Dana Katz, Arthur L. Caplan, and Jon F. Merz's (2003) concerns that physicians' prescribing habits may be unduly influenced by gifts from industry, regardless of the size of the gift. However, I worry that their argument might fail to persuade those who are in the best position to change these practices: namely, physicians and medical professional associations. As Katz, Caplan, and Merz note, no studies have been conducted on the effect of de minimis gifts on prescribing practices. In the absence of specific data they appeal to theoretical considerations on gift relationships drawn from the social sciences. In light of these theoretical considerations I find Katz, Caplan, and Merz's claim that physicians can be unduly influenced by small gifts quite plausible. However, in the age of evidence-based medicine, physicians have been taught to disregard theoretically plausible associations that are not confirmed by specific data—consider the theoretically implausible benefits of beta-blockers for congestive heart failure and the theoretically plausible but as-yet-unproven mortality benefits of calcium-channel blockers for hypertension. Furthermore, the studies that have been conducted on the impact of larger gifts (Wazana 2000) are often subject to conflicting interpretations—even when it can be established that prescribing has been affected by industry promotional efforts, it might be difficult to establish that it has been unduly affected. And finally, for better or worse, many individual physicians simply find it difficult to believe that their own prescribing practices are systematically influenced in ways of which they are unaware (Howard 2000). In light of these doubts, the most significant proposal in Katz, Caplan, and Merz's paper might be the call for further research "to determine the extent to which gift acceptance is associated with physicians' prescribing practices."

I think an equally powerful objection to physicians' acceptance of gifts from the pharmaceutical industry, one for which the empirical premises are generally agreed upon and less subject to conflicting interpretation, concerns the extremely high hidden costs of industry-to-physician marketing, which raise problems of distributive justice and physicians' fidelity to patients. In the year 2000 the pharmaceutical industry spent $13.2 billion on advertising and promotions directed at professionals, amounting to 11.8% of all pharmaceutical sales revenue and over five times as much as was spent on direct-to-consumer advertising (Rosenthal et al. 2002). These expenses not only reflect the cost of gifts, drug samples, and journal advertising, but also the significant cost of employing over 83,000 pharmaceutical sales representatives to distribute these gifts—more than one sales representative for every five office-based physicians, and a greater number than were employed by the pharmaceutical industry for drug production, research and development, administration, or distribution (Chin 2002; Pharmaceutical Research and Manufacturers of America 2001). Because the costs of these promotional efforts are passed on to patients in the form of higher prices for medicines, there is a strong prima facie case that physicians should refrain from participating in them—even when the gifts actually received are of negligible value.

In light of these costs I argue that accepting any gift from the pharmaceutical industry that primarily benefits the physician violates the standards of distributive justice and of professional obligation. Such gifts involve a surreptitious transfer of wealth from patients to doctors. Patients have been led to believe that the high cost of medication is due to expenses incurred in research, development, and manufacturing. They would likely be angry, and justifiably so, to learn that nearly 12% of their medication bills are spent in ways that tend to benefit (and are intended to influence) their doctors. Furthermore, while large HMOs and other favored customers can negotiate lower prices for medications, the uninsured and many Medicare recipients cannot (Angell 2000). Therefore, this burden falls disproportionately on the poor and the elderly. Finally, it is widely accepted that doctors are obligated to put their patients'...