You’ve got mail: a defense of data mining, in letters
On Wed., Nov. 20, as many readied their turkey dinners and packed the car, one Joseph Conn, staff writer for Modern Healthcare, wrote an article detailing the first week of hearings in the Maine prescriber data-mining case. Little could Mr. Conn know what he had started.
On Wed. Nov. 26, one Mr. Terry Nugent, Vice President of Marketing at Medical Marketing Services, which buys physicians’ data from the AMA and pairs it with pharmacy records to make primo detailing food for pharmaceutical companies, wrote a letter. This letter.
Today, Mon., Dec. 3, not wanting to bring the French Revolution to the pages of Modern Healthcare any more than was necessary, we write back to Mr. Nugent here.
In response to Joseph Conn’s “Data-miners unite in Maine to block ‘opt-out’ Rx law”, Mr. Terry Nugent (Letters, Nov. 26) writes that the “law of unintended consequences” is reason to continue to allow prescription data-mining, or the sale of physicians’ data to pharmaceutical marketers.
But the pharmaceutical industry’s invasive sales scheme operates instead on the law of intended consequences; the industry spent $7.2 B in marketing to physicians last year alone because they know it changes prescribing patterns. Mr. Nugent threatens that ending prescriber data-mining would cause marketing costs to “increase and inevitably be passed on to the patients and taxpayers of America,” but it’s a hollow threat because it’s already here. That $7.2B and the $18B more spent in samples is exactly why brand-name drugs are priced radically higher than their generic equivalents, and consumers and payers are the ones stuck with the bill.
Mr. Nugent calls laws such as Maine and Vermont’s prescriber privacy acts “a waste of taxpayer dollars.” On the contrary, laws restricting the sale of prescriber data to pharmaceutical marketers bring down health care costs by ensuring that doctors base prescribing decisions on science, not biased marketing, and by making more room in their schedules for patient care and continuing education.
Though he calls legislators seeking to protect this patient-physician relationship “liars”and “leftist politicians,” Mr. Nugent’s strangest name calling comes just words later, when he likens the opponents of this invasive marketing tactic to Marie Antoinette. It’s an odd analogy, as the mythology of the French queen—a spendthrift leader whose excesses came at the expense of her subjects—calls more readily to mind the pharmaceutical industry, which lavishly gifts doctors, even as it violates their most important obligation to care for patients by buying their prescribing data and raising drug costs for the public.
Update: Dr. Narayanachar Murali, a gastroenterologist from South Carolina writes to Modern Healthcare, thanking Mr. Nugent for educating him on the AMA’s sale of doctors’ data for marketing, and intimating that if more doctors knew about this practice, the professional medical association might have a suit on their hands.
Second update: Mr. Nugent writes back. This time he brings Adam Smith and fall of the T-model Ford to the defense of his middle-man industry.
His middle-man industry: The MMS homepage trumpets that as “the first company franchised to manage the AMA Physician list,” it has “developed a proprietary, multidimensional, identification process to convert data into perfect prospects. Translation? When it comes to selling out doctors to pharma, we’ve got it down to a science. Check out the company website here, including the montage of doctor portraits across the top. Did they all agree to their data being sold to Big Pharma? [And is that Dr. House on the right?]
Excerpt: “Murali prescribes ‘iron-fist’ regulation of the pharmaceutical market; my second opinion is the ’invisible hand’ of the market, which has guided our nation to worldwide economic pre-eminence.”
We still have unanswered questions: Where are the Modern Healthcare referees? When Dr. Murali wrote about the iron-fist, was he alluding to despotic regulatory tactics, the Marvel superhero, or the heavy metal album? We may never know.
And so, unable to channel either Adam Smith or Joseph Stalin, PostScript has declined to respond to Mr. Nugent’s second letter.
But we’ll be sure to keep watching the data-mining hearings in Maine and the pages of Modern Healthcare for more on this issue.
December 15th, 2007 at 1:07 pm
very interesting, but I don’t agree with you
Idetrorce
December 17th, 2007 at 1:58 pm
I am “one Mr. Terry Nugent”. Those who criticize “the pharmaceutical industry’s invasive sales scheme” have a point, one that the industry is recognizing by laying off pharmaceutical representatives in droves. However, it is not “because they know it changes prescribing patterns”. It’s because it doesn’t anymore. There are too many reps chasing no-see docs. Change is in the air. Read the papers, specifically the Wall Street Journal, which recently outlined the radical changes the industry is implementing to cut marketing costs, particularly sales.
Prescriber data used wisely is an excellent tool to do just that. Those who wish to restrict data access really want to drive down the cost of marketing pharmaceuticals. So do I. However, the way to do that is not to make prescriber behavior less transparent. Used wisely, such data makes marketintg more efficient and effective for both marketers and prescribers.
The real flaw in the argument against evidence-based marketing with prescriber data is that it is responsible for increasing the cost of prescription drugs. There are many reasons for the increase, but prescriber data access is not among them. Demand is a primary driver of cost. Demographics, new product development, and direct-to-consumer (DTC) marketing are factors that have driven demand. But making prescriber data less available will increase, not decrease, costs, and that those costs will indeed be passed on to payers. I would think critics would be the first to acknowledge that companies will pass on increased costs.
As to costs, sample distribution is hardly a function of prescriber profile data. Samples abounded before such data was available. Samples costs are inflated anyway as they are measured at price not cost. Ironically, oversampling actually costs companies money as often the entire therapeutic dose is provided via samples to those who could werll afford to pay (case in point: me–this recently occurred with not one, but two Rxs on a personal visit to my own physician). Downsizing the salesforce will perhaps reduce such unintended consequences. However samples are a principal tool physicians use to treat the underinsured and uninsured–be careful what you wish for, oh advocates of the underpriveleged.
Brand name drugs are not priced higher than generics because of marketing costs. Rational profit maximizers wish marketing costs were zero. Companies price to optimize profit because they are for-profit entities, most publicly traded, with fiduciary responsibilities to shareholders. Companies market to maximize profit, as they price. But if drugs sold themselves there would be no sales forces and no samples.
You can debate whether it is unethical to profit from healthcare. But that is our system. Hospitals, doctors, medical device companies, all players in the healthcare market all make a profit, and they all market-because they have to. Great gains in quality of life and longevity have been attained through our system. Does anyone seriously believe that the innovation of the modern era would have occurred if profit from healthcare was illegal? Would government or academia achieve more? Perhaps the Hugo Chavez’s and Fidel Castros of the world would say si, but I and most Americans say no.
I do indeed call laws such as Maine and Vermont’s prescriber privacy acts “a waste of taxpayer dollars”, mainly becuase the authors know they are unconstitutional and pursue them for to pander for votes in my opinion more than to change the world. They will raise, not lower, health care costs. If anything, more physicians will receive more marketing information because companies will not be able to target physicians who might benefit from such information and will have to send it to every physician in the target specialty (see what I mean about unintended comsequences). Doctors have an excellent tool to insulate themselves from pharmaeutical representatives–it’s called the word no. Many physicians choose, for better or worse, not to see pharmaceutical representatives. Why is that freedom to choose not sufficient for those who seek to waste taxpayer dollars in a quixotic attempt to violate the First Amendment?
I have called those who say that prescriber profiling reveals patient specific data liars. They are. It doesn’t.
While I’m glad you enjoyed our Web site (and no that is not Doctor House, it is a generic doctor-you should be pleased), I beg to differ with your characterization. We facilitate communication from marketers to physicians. Some of these marketers are pharmaceutical, others are academic medical centers purveying continuing medical education opportunities (which I gather you support), job opportunities in underserved areas, and other offers you might find more socially beneficial. All of these marketers have a right to communicate with physicians. We merely facilitate that communication in an efficient manner, enabling communications germane to the recipient. Properly used, our services spare physicians and other health professionals irrelevant communications and reduce marketing costs. We believe those are good things, and we have since our founding in 1929. Marketing will be done, whether you like it or not–we seek to do it better for all parties involved.
Enemies of the pharmaceutical industry certainly can be fairly categorized as proponents of generics. The problem is that in a generic world there is no incentive other than altruism to launch new drugs. Call me a cynical capitalist, but I would rather depend onm the profit motive for pharmaceutical progress than the better angels of human nature. It costs over a billion dollars to develop a new drug. There is multi-billion dollar liability associated with product launches that go awry. This is a big league game requiring big league bats and balls–serious capital that by its very nature demands serious returns. As a patient, I hope enemies of the industry fail, because I yearn for new drugs that will conquer the remnant diseases that afflict us. Thus I think the Marie Antoinette analogy is more than apt. However, perhaps a better metaphor is the grey world of communism, in which evil capitalists were banished along with any whiff of innovation, where workers pretended to work and the state pretended to pay them, where everything was free but nothing was available, and where healthcare utilized drugs and devices as old as Marx. Those who fail to learn from the past are doomed to repeat it. Fortunately, I believe most of us have learned our lesson.
December 19th, 2007 at 11:07 am
[...] sales force via a nifty process called “data mining” (more on that here and here). The law is being challenged by industry and the middle men running the sale, who claim medical [...]