Rewarding doctors to promote drugs

Drug companies recruit physicians to promote their drugs by paying them to participate in speaker’s bureaus. Here’s an example, as recounted in Sandeep Jauhar’s book, Doctored: The Disillusionment of an American Physician: “…a sales representative of the pharmaceutical company Scios…invited me to join Scios’s speakers’ bureau and start giving paid talks using company slides to promote the drug Natrecor….Though the talks were obviously for marketing purposes, I didn’t think giving them would be sleazy or unethical, especially since Natrecor was a drug I prescribed and believed in. Moreover, and just as important, I needed the money….This started a series of talks I gave over the next two years. At first, I asked to use my own slides to maintain some semblance of objectivity, but the company wouldn’t allow it. I asked if I could modify the standard company slides with some of my own interpretations, but it wouldn’t allow that either. Typically, the talks took place at a fancy restaurant on Long Island or in Manhattan once or twice every couple of months. I’d get paid a thousand dollars or more for each talk.” After about two years, Jauhar quit the speakers’ bureau, noting that Natrecor was safe but “no more effective than existing, cheaper therapies.”

The pharmaceutical industry calls doctors like Juahar “Key Opinion Leaders” (KOLs). Juahar may have been in the KOL minor leagues, but some doctors are big league, as one pharmaceutical sales representative described a KOL by the name of Von Hoff: “He was a big KOL-kahuna physician on steroids who conducted more clinical trials for drug firms than nearly any other KOL. He collected advisory fees and perks from more than thirty pharmaceutical firms and sat on several companies’ boards. When I saw how many shares he owned in biotech and drug firms, my jaw dropped. A good word from Von Hoff could catapult a drug’s sales.”

In a story about doctors prescribing anti-psychotic drugs to foster children, the San Jose Mercury News reported: “One Sacramento doctor raked in more than $310,000 in four years to give promotional speeches.” But it’s not just the money that draws physicians into the ranks of KOLs, it’s the feeling of importance that comes from associating with other academic luminaries who've been recruited by drug companies. It’s like being admitted to a selective fraternity. As one KOL reported, "You get to hobnob with these mega-thought leaders and these aspiring thought leaders. They make you feel like you're special."

The pharmaceutical industry spends a third of its marketing budget on KOLs, a fact that adds to the cost of drugs. In 2001 consumers paid the 30% markup for sales promotion. The markup is probably higher now.

Next week: Rewarding doctors to prescribe drugs

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