The suit draws a comparison to the newspaper industry: Even though papers profit from disseminating information, the information in question isn't commercial.
The long-running battle over sales reps' use of prescribing data escalated sharply this summer. New Hampshire passed the Prescription Restraint Law, which makes it illegal to sell or license prescription data that identifies the prescribing doctor, to keep the data away from pharma. Then IMS and Verispan, the companies that buy the data, sued the state, alleging among other claims that the law violates the free-speech rights of data sellers—from pharmaceutical benefits managers to retailers and Internet pharmacies. The issue isn't marketing, the suit says, but sellers' First-Amendment right to convey the "truthful information" they own.
The case did not have a court date at press time. But for now, the two sides are waging a war of words. Supporters of the New Hampshire statute claim that sales reps from pharmaceutical companies use prescriber data to pressure doctors to prescribe their products—drugs that might be more expensive than the ones patients are using. "These practices continue to increase the bottom line of the pharmaceutical companies," says John Stephen, commissioner of New Hampshire's health department, adding that when drug reps pressure physicians to prescribe more expensive drugs, taxpayers bear the cost. "The only benefit is the benefit to the manufacturers' pocketbooks," he said.
IMS and Verispan do not dispute that many of their clients—pharmaceutical companies—deploy sales teams based on where a drug is (and is not) being prescribed. But they argue that nothing in the New Hampshire law guarantees that restricting access to such data will lower drug prices.
What it may do is shift the way pharma markets drugs, and not necessarily for the better, argues Randall Stafford, MD, an assistant professor of medicine at the Stanford Prevention Research Center. Companies that are prohibited from using prescribing data as a sales tool are likely to simply shift dollars to other marketing activities, such as direct-to-consumer (DTC) advertising. "There's certainly ample evidence that physician selection of drugs doesn't correspond to best practices, [but] there are better ways of addressing these concerns," says Stafford, who often uses prescriber-level data in his research, which IMS provides free of charge to many academics. "I actually believe that greater restrictions on DTC advertising ... is a better choice of public policy as opposed to restricting physician-level information," Stafford says.
Whether or not the law affects drug prices, IMS and Verispan say it violates the free-speech rights of their data suppliers—PBMs, managed care organizations, and pharmacies. These organizations, according to the suit filed against state Attorney General Kelly Ayotte in US District Court in Concord, have a constitutional right to aggregate and sell prescribing information. The Prescription Restraint Law is "indirectly imposing restrictions on the dissemination of truthful information," the suit states. "The State should not be permitted to achieve indirectly by suppression of constitutionally protected speech what it is prohibited from regulating directly," i.e., the cost of drugs or physician–sales rep interactions.
Moreover, IMS and Verispan argue that data sharing in and of itself is not a marketing activity. Rather than "proposing a commercial transaction," the suit states, the pharmacists, PBMs, and insurers "are conveying truthful information that lawfully is in their possession." The suit goes on to draw a comparison to the newspaper industry: Even though publications profit from disseminating information, the information in question isn't commercial.
"The New Hampshire bill prohibits the speaking of something that's lawful," says Fred Cate, a senior policy advisor at the Center for Information Policy Leadership. The center is affiliated with Hunton & Williams, the law firm representing IMS and Verispan. "That's a first in the nation."
Cate, an attorney who is not working on the case, notes that states are free to regulate marketing activities—such as gifts to doctors—and even drug prices. But he questions the constitutionality of curbing speech to accomplish those objectives.
IMS and Verispan also insist that physician-identified prescribing data serves greater causes, like the overall public health of the nation. Once the data is collected, the companies provide it free of charge to researchers at places like FDA, the Institutes of Medicine, the Mayo Clinic, and the American Red Cross.
"By enacting these sorts of restrictions, other uses of the data—beyond what the pharmaceutical companies use it for—would likely be restricted," says Stafford, the assistant professor from Stanford. Stafford is currently participating in a federal initiative to educate physicians on the results of the ALLHAT study, which found that older blood-pressure medications are just as good as newer ones. His role in the initiative is to use the data to evaluate the effectiveness of those education efforts—to see if physicians have switched their patients to the older (and perhaps less expensive) products.
But Stephen says there is no restriction on compiling the data for research purposes. "The data is still available to the government," he says. "The data is still available to Medicare."
Not good enough, say IMS and Verispan, which argue that if pharmaceutical companies no longer have access to meaningful data, there will be no one to pay for its collection—or to use it in times of crisis.
"FDA relies on the pharmaceutical manufacturers to contact affected [physicians]," says Robert Hunkler, director of professional relations at IMS, pointing to a recent FDA warning about mixing SSRIs and triptans, a class of migraine medications. "Without that information, we're hamstrung."
In addition to their Constitutional and public-health arguments, IMS and Verispan argue that the Prescription Restraint Law is vague, overreaches in scope, and violates interstate commerce laws.
"It's not clear in some cases which attributes are identifiable," says Jody Fisher, vice president of product management for Verispan, referring to the fact that data companies can still collect prescribing information that masks the prescriber. For instance, the law allows the collection of zip code-level data—but what if there is only a single prescriber within that zip code? Or only one with a particular specialty?
The suit also points out that New Hampshire is trying to legislate commerce occurring in other states. Not only is the data aggregated and used outside the state, but New Hampshire doctors write many prescriptions that are filled out of state.
Representatives from the New Hampshire governor's office and the US Department of Health and Human Services did not respond to requests for comment.
As a market, New Hampshire provides less than one percent of raw information compiled by IMS, says Hunkler, but the issue is larger than the volume of data."It's a matter of principle," he says. "We think that the law and others like it rob the healthcare system of valuable data."
Some observers fear that the new law could deter pharma and biotech companies from investing in the state, which is home to Dartmouth University. "It is a horrible economic-development message," says Charlie Arlinghaus, president of the Josiah Bartlett Center for Public Policy, a non-partisan think tank in New Hampshire that opposes the law.
Other critics of the law worry that it could have a spillover effect into other states, a number of which have already passed—or are trying to pass—measures designed to limit pharma's physician-directed marketing activities.
"There are a lot of states in a holding pattern," says Jim Alonso, chairman and CEO at ASI Business Solutions, which makes compliance software. "New Hampshire is the first domino that has fallen."
Many opponents of the New Hampshire law are instead backing the American Medical Association's prescribing data restriction program (PDRP), which went into effect July 1 and allows physicians to decline to share their prescribing data.
And because the PDRP is voluntary, it encourages drug reps to improve their interactions with doctors, supporters note. "The concern that started all this was the inappropriate use of this data by sales reps," says Verispan's Fisher. "We don't condone this use at all."
There are currently about 3,500 enrollees (less than half of a percent of all practicing physicians) who have enrolled in the PDRP. The new program allows physician-level data to be collected and shared with industry executives, as long as they don't pass it on to their sales reps.
Stafford notes that it's impossible to tell where physicians stand on the measures, but that there has been a trend toward more transparency in healthcare, not less.