MedPAC Weighs Pros, Cons of Industry-Physician Database

Establishing a national database on financial relationships between physicians and drug and device manufacturers could discourage inappropriate arrangements, but it also could curtail beneficial arrangements. That was one of the messages delivered by Ariel Winter, M.P.P., a senior analyst with the Medicare Payment Advisory Commission, or MedPAC, who spoke during the commission's last meeting here in early September.

In its June report to Congress, (288-page PDF; About PDFs) MedPAC discussed establishing a national database on physician and industry relationships and laid out the potential benefits and risks of such a repository. For example, the report noted that a national database could shed light on physician and industry relationships and, thus, discourage or perhaps even eliminate conflicts of interest.

"Payers and plans could examine whether physician practice patterns are influenced by their relationships with the industry," Winter said, citing the report during a Sept. 4 presentation.

The report also said, however, that a national database could result in compliance costs for manufacturers, as well as administrative costs for the federal government, which would need to implement and enforce any reporting laws. In addition, a national database could "discourage beneficial arrangements," Winter said. And there is no guarantee that a national database would eliminate conflicts of interest.

Winter described relationships between physicians and drug and device manufacturers as "pervasive," saying that a recent study found that pharmaceutical companies spent $7 billion on physician detailing in 2005, and they provided free samples worth $18 million in the same year. Seventy-eight percent of physicians received free drug samples during the past year, said Winter.

"Relationships between physicians and manufacturers have both benefits and risks," he noted, echoing points made in the June MedPAC report. "Physicians play an important role in developing new drugs and devices by providing clinical trials and providing expert advice."

But the relationships also can undermine physician independence, leading physicians to prescribe more expensive medications and resulting in a greater push to add certain drugs to hospital formularies.

"In addition, there is evidence that clinical research funded by manufacturers is not always objective and publicly available," said Winter.

MedPAC is trying to determine how it should address physician/industry relationships and the recommendations it should make to Congress in an upcoming report to be released in March. Most of the commission members support the concept of transparency, saying that they endorse disclosure.

"I think transparency is a good thing, but even good things can have unintended consequences," said MedPAC Chair Glenn Hackbarth, J.D., M.A., during the September meeting. "I think as we go through the individual issues and subsequent conversations, we need to take due care that we try and minimize unintended consequences."

Only five states and the District of Columbia require manufacturers to publicly report payments to physicians. Those laws have different thresholds for reporting gifts, ranging from $25 to $100 per gift. Perks typically include gifts; meals; entertainment; honoraria for consulting, education, and speaking; research; investment interest; and product royalties.

"We propose that the lower end of ($25) be the threshold for reporting under a federal system," said Winter. "This would enable collection of data on smaller gifts and meals."

However, FP Thomas Dean, M.D., of Wessington Springs, S.D., the only family physician on MedPAC, said during the question-and-answer period that the $25 threshold is too low. "We should not lose sight as to why we are concerned about this in the first place," he said. "There is bad behavior out there, but hopefully, it is limited to a small proportion of the professions. We need to get to that rather than making it difficult for everybody."

"That argues for raising the amount of the value of the relationship we are going to try and look at," he added.

Dean also said drug samples should not be included in any proposed database. "For the most part, physicians don't benefit from the availability of samples," he said. "In fact, it might complicate our lives."

Winter proposed including large and small drug and device manufacturers in any national data system to "achieve a level playing field." He also recommended reporting grants made to medical centers, CME organizations, patient advocacy groups, and physician membership organizations, which receive significant financial support from manufacturers.

In addition, Winter noted that there is some question about whether companies should be allowed to withhold proprietary information, creating a "tradeoff between allowing manufacturers to protect sensitive information about product development and the public's legitimate interest in learning about the industry's financial relationships."

"One option for navigating this issue is to allow companies to delay reporting of payments to physicians that are related to the development of new products, consulting agreements and the funding of clinical trials," Winter said. "This delay could be tied to the point at which the development effort becomes publicly known."