Thursday, February 10, 2011

Cutting the Gordian Knot: Legal Ban on Gifts/Bribes?

Some time in the past I declared that for purposes of this blog, I was going to stop using the word "gifts" for things that drug and device companies give to physicians and others as part of their marketing campaigns and revert to the more truthful descriptor, "bribes." For this post I'll go back to "gifts" since the sources I'll be citing use that term.

A quick review--first we decided the way to deal with these gifts was to have professional organizations develop codes of ethics, or for Pharma to self-police. Some victories occurred, such as when Pharma felt really under pressure and feared serious federal laws in 2008-9 and decided to throw all the "reminder items" (coffee mugs, pens, etc with drug logos) under the bus. Pharma showed us what they think really is essential for successful marketing by refusing to consider giving up free meals. Mostly this general strategy has been a flop. Codes of ethics either cannot get past the organization's members (such as the AMA House of Delegates) or else make useless distinctions such as how much is the gift worth, is it directly related to patient care, etc. During the era of mostly relying on codes of ethics and self-policing, physicians in the thrall of the drug industry fell from a high of 94% all the way down to a measly 87%-- a drop many of us would consider not quite equal to the actual need for reform.

Then we decided that sunshine laws were the way to go, just disclose all gifts and the amounts and docs will be ashamed of themselves and stop. So several states passed disclosure laws, generating (as in the case of MN) a lot of paperwork that sat in boxes in a warehouse because there was no budget to process it or put it on the web in searchable form. Not until ProPublica got on this just recently ( was there a really user friendly way to access this info. Too soon to see, therefore, if this approach can work.

So, if these past approaches seem to have little effectiveness, what would be better? Two recent works cut the Gordian knot and propose simply outlawing all these gifts and meals.

First I'll mention Marc A. Rodwin's just-out book, Conflicts of Interest and the Future of Medicine: The United States, France, and Japan. Law prof Rodwin (Suffolk U.) has written an interesting volume that I'll be blogging more about in a little while. The point here is that he views these bribes as against the public interest and therefore suitable for legal action, both in defense of prescribing quality and to control costs.

Next is a paper by a law student who reviews all the arguments for saying that these marketing practices are contrary to public interests, and then proposes a model statute to ban gifts and free meals. Joshua Weiss's main concern in this review is the usual defense used by corporations when restrictions on their marketing are proposed, that this is a violation of free commercial speech. Weiss in lawyerly fashion studies all the legal precedents and shows how he's crafted his model statute to resist the various free speech objections, given that the courts have ruled that you can restrict commercial speech if certain conditions are met. A key condition he addresses is how narrowly the restriction is crafted, so as to eliminate only the specific behaviors that are offensive.

Two comments. I am of course not a lawyer. I note that Rodwin apparently sees no problem in suggesting a legal ban on gifts and free meals. Weiss is worried about free commercial speech objections. What seems possible from a non-lawyer's view is to ban gifts and free meals and still permit as much interaction between drug reps and medical folks as the companies want. That way there is clearly no interference with free speech. The drug industry seems to be betting that if these bribes were totally eliminated, drug reps could hardly get a foot in the door. Let's see.

Next comment--don't expect any of this to be easy. Weiss goes after his fears of legal objections to a model statute by defining at some length exactly what relations between Pharma and docs would be still allowed, vs. what would be prohibited. We can expect that the drug companies would make every effort to find the loophole that would allow them to still shovel something into the docs' pockets that would make them feel indebted to the giver, but it will be speakers' fees or consulting fees or whatever seemed the new line of least resistance. Consider again the example of the device industry--paying docs million-dollar royalties, but insisting that the device on which they get the royalty is a different device from the one they do research on or implant into patients (

So an interesting question is: legal commentators are quite ready to contemplate laws that simply ban gifts and free meals. Is any legislature ready to undertake this step? It would be at least interesting to see how the Pharma lobbyists would fight against such a bill. Would they go on saying "it's not marketing, it's education," their usual mantra to defend detailing, when the only thing being banned is freebies and not any "education"?

Rodwin MA. Conflicts of interest and the future of medicine: the United States, France, and Japan. New York: Oxford U. Press, 2011.

Weiss J. Note: medical marketing in the United States: a prescription for reform. George Washington University Law Review 79:260-292, November, 2010.


Michael S. Altus, PhD, ELS said...

What are the policies that gift-giving pharmaceutical companies have about their employees’ receiving gifts? Here’s an update of my comment (July 16, 2010 4:22 PM) on The Carlat Psychiatry Blog entry, “Food Stamps for Doctors: Mass Legislature Votes Today” Wednesday, July 7, 2010 (

Effective July 1, 2010, Vermont law banned giving gifts, with some exceptions, to healthcare providers. Before then, Vermont law required pharmaceutical manufacturers to disclose gifts to physicians and other health care professionals. The most recent data, for fiscal year 2009 (July 1, 2008 to June 30, 2009), show that the manufacturers spent about $2.6 million. Physicians and nurses received about $2.1 million of these gifts. Gifts worth less than $25 were exempt from disclosure. The top five spenders for marketing in Vermont during FY 2009 were Pfizer, Lilly, Forest, Merck, and GSK. These data, which do not reveal the actual amount spent by each company, are at

Here are the policies of these top five spenders about their own employees receiving gifts.

The Blue Book: Summary of Pfizer Policies on Business Conduct (, p. 27
Giving and Accepting Gifts, Entertainment, Loans, or Other Favors
The Company prohibits you...from giving and receiving gifts, services, perks, entertainment, or other items of more than token or nominal monetary value to or from the Company’s suppliers, customers, or other third parties. Moreover, gifts of nominal value are permitted only if they are not given or received on a regular or frequent basis.

The Red Book: Code of Business Conduct 2010 (, p. 34
Certain types of dealings with suppliers or potential suppliers also present conflicts or the appearance of conflicts. Employees must not accept gifts, entertainment, payments, or personal services from parties who conduct or seek to conduct business with Lilly.

Forest Laboratories
Code of Business Conduct & Ethics (
4. Conflicts of Interest
All employees, officers and directors of the Company must be scrupulous in avoiding any conflict of interest.... Conflicts of interest may also include...situations where an employee...receives improper personal benefits as a result of his or her position in the Company.... Conflicts of interest are prohibited as a matter of Company policy, except under guidelines approved by the Board of Directors or committees of the Board.

Merck & Co: Our Values and Standards: The Basis of Our Success
Edition II Code of Conduct (, p. 10
Receiving Gifts
(While the receipt of gifts may be more common in the context of supplier relationships, these guidelines are included here for ease of reference and convenience.)
As a common business courtesy, we may receive occasional gifts, provided that:
• The gift is of nominal value (e.g., pens, notepads, calendars, etc.);...
•The gift is neither intended nor likely to be perceived by others to improperly influence our business decisions. Occasionally, there may be times when refusing a gift would be impractical or embarrassing. In those rare instances where the gift is of substantial value, accept the gift on behalf of the Company, report it to your manager, and turn the gift over to your local/regional finance director, who will handle its disposition.

GSK Code of Conduct (, p. 3
4.3. Acceptance of Entertainment and Gifts
GSK Staff may accept gifts or entertainment that are lawful and ethical, supports GSK’s business, (e.g., not just for staff well being or use), are infrequent, low in value, and are customary in a business relationship (e.g., pens, coffee mugs or calendars). If any Staff is uncertain about whether a gift is permitted or not, he or she must seek guidance from their supervisor, or a Compliance Officer.

The unblinking hypocrisy is galling.

Howard Brody said...

Michael's comment above is a very telling point. If the pharmaceutical companies would only apply to their relationshiop with phyysicians the same ethical rules they expect their own employees to follow, gifts/bribes would be out the window tomorrow.

Pharmacy Feedback said...

Giving gifts to doctors sounds like bribery to me. I know for a fact that Pharmaceutical companies practice this habit of gift giving in order to gain a doctor's approval in promoting and using their medicines at the hospitals where they work.