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Is the Law of Transparency Transparent Enough?

June 10, 2016

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By Jyoti Pandey
Senior Consultant, Integrity Leadership Partners, LLC

In an effort to make the practices by pharma companies transparent and reliable, the government has taken certain initiatives and enacted several laws in the recent years. The question that comes to mind is – is the law of transparency transparent enough? The Physician Payments Sunshine Act originally introduced in 2007 by U.S. Senators Chuck Grassley (R-IA) and Herb Kohl (D-WI), [1] and was enacted as part of the Affordable Care Act (ACA) passed in March of 2010 mandates that pharmaceutical companies and manufacturers of surgical tools disclose the financial transactions that they involve in with physicians beyond the threshold value of $10 with an annual aggregate of $100 or less. This law was designed to bring transparency to the company’s dealings with the HCOs (Healthcare organizations) and HCPs (Healthcare professionals). Through this initiative it wanted to ensure that the companies are not trying to influence the physicians to boost the sales of their drugs as profit over health benefits for the patients was always in question.

In 2014 the U.S. government published the first set of data reported by pharmaceutical companies and medical device manufacturers under the Sunshine Act, also known as Open Payments. The figures detailed the amount of money the companies spent on all meetings attended by doctors, a total that came to a staggering amount $6.49 billion to U.S. doctors and teaching hospitals during 2014, according to the federal government’s first full-year accounting of the breadth of industry financial ties with medical providers.

The tally comprises company payments to more than 600,000 doctors and 1,100 hospitals for services such as consulting, research and promotional speeches about drugs, as well as the value of free meals provided to doctors by sales reps pitching products. [2]

The bigger question is – is it really that simple? Disclosing the information related to financial ties shared between the HCPs and HCOs and the pharma companies on the CMS and pharma companies’ website is merely fulfilling the mandated requirement that only scratches the surface. There are so many different components hidden in the information provided which the general population is not qualified enough to understand. The most complex among them is deceptive marketing practices. Paying to medical practitioners to promote their products come in many different forms. “The Consumers International report says that drug companies use unscrupulous and unethical marketing tactics not only to influence doctors to prescribe their products but also subtly to persuade consumers that they need them,” writes Sarah Boseley in Guardian Weekly. [3] The IOM (Institute of Medicine) now known as HMD (Health and Medicine division) report notes that total Medicare spending on prescription drugs increased from $400 million in 1992 to $7 billion in 1999, by another $1 billion in 2000, and then an additional 26% from 2001 to 2002. The growth in spending is attributed to “the increased volume of new and more expensive medications that were being substituted for older therapies.” Consumers should be concerned because time and again the companies violate their own industry’s ethical marketing codes. This happens despite the strengthening of the code of ethics of the Pharmaceutical Research and Manufacturers of America.

“At its essence, the Sunshine Act requires applicable manufacturers of covered drugs, devices, biological products, and medical supplies to annually report to CMS information regarding payments, ownership, investment interests and other transfers of value to physicians and teaching hospitals,” explains Scott Liebman, a principal at Porzio, Bromberg & Newman and Vice President at Porzio Life Sciences. “The intent of this law is to bring potential conflicts of interest to light with the goal of driving down healthcare costs,” Liebman added. However, the areas that are under conversation for challenges faced in transparency are –

This act fails to cover nurse practitioners and physician’s assistants, who also receive payments for promotional talks, consulting, meals, and other activities. A nurse practitioner in Connecticut pleaded guilty in June to taking $83,000 in kickbacks from a drug company in exchange for prescribing its high-priced drug to treat cancer pain. In some cases, she delivered promotional talks attended only by herself and a company sales representative. [4]
Nurse practitioners and physician assistants are playing an ever-larger role in the health-care system. While they are not authorized to write prescriptions, those with additional training and advanced degrees often can. A ProPublica analysis of prescribing patterns in Medicare’s prescription drug program, known as Part D, shows that these two groups of providers wrote about 10 percent of the nearly 1.4 billion prescriptions in the program in 2013. They wrote 15 percent of all prescriptions nationwide (not only Medicare) in the first five months of the year, according to IMS Health, a health information company. (Pacific Standard)
Physicians significantly underreport company payments to their academic medical centers and the National Institutes of Health
Pressure from commercial groups impacting the health objectives
Generous political campaign donations and lobbying expenditures by pharmaceutical companies
Aggressive promotion of medicines, the sheer volume of information that is received in its many forms by prescribers and the use of patient groups through which to generate demand for prescription drugs, all contribute to the inappropriate prescription of medicines.
The CMS Open Payments website gave doctors an opportunity to preview the payment data reported in their names before it went public, as well as to dispute information they believed was inaccurate. Only a portion did so. CMS said doctors and teaching hospitals reviewed about 30% of the total value of the data before it went public. (WSJ)
In its statement Tuesday, the AMA said “the vast majority of the data released today has not been independently validated by physicians, which makes it less usable for the patients it’s intended to benefit.”
Unethical pharmaceutical marketing practice that has received a great deal of attention in recent years, prompting many doctor’s associations, pharmaceutical industry’s associations and individual corporations to engage with the issue. Many have passed codes of conduct and ethical guidelines for the marketing of pharmaceuticals; but since they are not monitored and enforced, their desired impact is limited.
Huge cost of marketing prescription drugs. The American Medical Association (AMA), the organization of physicians, states that only the U.S. and New Zealand allow this practice. An AMA report noted, “The growing proliferation of ads is driving demand for expensive treatments despite the clinical effectiveness of less costly alternatives.”
Patrice A. Harris, chair-elect of the AMA, added: “Direct-to-consumer advertising also inflates demand for new and more expensive drugs, even when these drugs may not be appropriate.”
The success of the Sunshine Act will be significantly impacted by the ability of CMS to collect and organize data, settle disputes between physicians and manufacturers, and publicize the data in a timely manner. As the implementation continues many stakeholders are encouraging CMS to provide context to the data in order for patients and interested parties to fully understand these financial interactions. [5]

While law of transparency is a welcome move, the desired impact will be severely limited by the conflicting priorities for the competing profit motives by the several interest groups involved. Besides there is a lack of information in the general public and even within the doctors’ community about what it entails and the background behind this law. In my conversation with a few of the doctors, I learned that although they are seeing a different approach by sales professionals during their meetings as they don’t offer food and gifts anymore, not many were truly aware of the new law behind this new approach. “Collaboration between physicians and biopharmaceutical professionals is critical to improving the health and quality of life of patients,” the Pharmaceutical Research and Manufacturers of America said. “Clinical trials sponsored by biopharmaceutical companies have led to life-saving breakthroughs for people suffering from cancer and other life-threatening diseases. Physicians also provide real-world insights and valuable feedback to companies about their medicines to improve patient care. Educating the public about the nature of these collaborations helps patients understand in which ways these interactions can improve both their health and medical innovation.”

What can we do –Key Takeaways

There needs to be more education and conversation around this area. The conversation should include clearly stated objectives and goals. Ask more questions and find out information about this new approach.
The program needs to include the entire spectrum of healthcare professionals, including the nurse practitioners and anyone else who could be in the position to influence the decision of the public.
The report should be broken down to its different components for the information published to make more sense for the audience it is meant for.
Prioritize health over the profit motive. US has the highest cost of medicine in the world. The expensive does not always mean effective.
Last but not the least, don’t get lost in the abundance and deluge of data. Keep materiality a critical piece.

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