Fact Sheet

Regulating Industry Payments to Physicians

Identifying & Minimizing Conflicts of Interest

Physicians write more than 2 billion prescriptions a year, an average of 7 for every American. Intensifying competition to capture these sales has doubled pharmaceutical industry marketing expenditures directed at physicians from $3.5 billion in 1996 to $7.2 billion in 2005 (excluding pharmaceutical samples). An undisclosed portion of that budget is spent on direct payments to physicians in the form of gifts, food, continuing medical education, travel, and consultancy fees. It is estimated that industry spending for lunches may alone total as much as $1 billion a year. A recent survey published in the New England Journal of Medicine indicates that 94% of physicians have received food, drug samples or other reimbursements and payments from the industry.

Several states and the District of Columbia have enacted so-called “sunshine laws” setting limits on industry payments to physicians and/or requiring disclosure of the payments. Existing laws are important first steps toward developing policies not
only to detect existing conflicts of interests, but ultimately to prevent them and end inappropriate industry influence on prescribing.

Proposed federal legislation: the Physician Payments Sunshine Act

Proposed legislation in both the U.S House and Senate would require industry to disclose “transfers of value” to physicians. Transparency laws highlight the need for change, but unlike actual marketing restrictions, disclosure itself is unlikely to completely mitigate the influence of industry marketing on prescribing. In this regard, existing laws are important first steps toward developing policies to not only detect conflicts of interests, but ultimately to prevent them.

The elimination of conflicts of interest in prescribing will:
• increase the quality and safety of prescribing
• lower prescription drug costs
• repair the damaged credibility of the medical profession
• restore patient confidence

Download the full PDF for more information.

Media Contact

Tami Holzman

Officer, Communications