Healthy Skepticism Library item: 19221

Warning: This library includes all items relevant to health product marketing that we are aware of regardless of quality. Often we do not agree with all or part of the contents.

Publication type: news

Kendall B
Court Takes Up Drug-Data Case
The Wall Street Journal 2011 Jan 7
http://online.wsj.com/article/SB10001424052748704055204576068260177082914.html

Full text:

The Supreme Court agreed to decide whether states can bar the sale of doctors’ prescription data to drug companies, setting the stage for a ruling likely to affect one of the pharmaceutical industry’s most powerful marketing tools.

Currently, data companies such as IMS Health Inc. gather information from pharmacies on which medicines doctors are prescribing and how often. Drug makers buy the data, using it to refine their marketing pitches and measure which salespeople are the most effective.

A 2007 Vermont law effectively banned the practice in the state. It says data-mining companies can’t sell the prescription information for marketing purposes, and drug makers can’t use it, unless the prescribing doctor consents.

Vermont lawmakers said the measure would protect the privacy of doctors and patients and help to control health-care costs on expensive brand-name drugs. The state said the pharmaceutical industry spends nearly $8 billion a year on marketing efforts directed at doctors.

IMS Health and two other data-mining companies, along with a leading drug-industry trade group, challenged the law on First Amendment grounds and won a key ruing in November. A federal appeals court in New York found the Vermont law an unconstitutional restriction on the commercial free-speech rights of the plaintiffs.

That ruling conflicted with a ruling by a different federal appeals court upholding similar laws in Maine and New Hampshire. Now the Supreme Court will settle the issue.

Vermont Attorney General William Sorrell said he looks forward to the Supreme Court arguments, which could come in April. “Vermont doctors pressed for this law because of their concerns about privacy and because they view this data mining practice as an intrusion into the way doctors practice medicine,” he said.

IMS Health and the other data-mining companies said the laws in Vermont and elsewhere “harm patients by making it more difficult to communicate timely and often vital information about new medicine and safety updates on existing medicine.”

Separately, the Supreme Court said it will consider whether investors can proceed with a securities-fraud lawsuit against Halliburton Co.

A federal appeals court in New Orleans blocked the class-action lawsuit last year, saying plaintiffs failed to show that the company’s alleged misstatements inflated its share price.

In their petition the Supreme Court, the investors said the lower-court ruling erected a new, higher standard that could make it more difficult for some securities lawsuits to move forward. The investors said the appeals court wrongly required them to prove essential pieces of their case at early stages of the litigation. The Obama administration, siding with the investors, filed a brief that urged the high court to hear the case.

Halliburton said there was nothing unusual about the legal approach the lower court used to reject the shareholder lawsuit, which alleges that Halliburton misled investors about its asbestos liabilities and other matters roughly a decade ago.