Drug Companies Paid Doctors More Than $200 Million Last Year

Firms with the highest U.S. sales last year didn’t spend the most on physician marketers. Industry leader Pfizer, with sales of $26.2 billion, spent $34.4 million on speakers, ranking third among the eight companies. By comparison, Eli Lilly and Co. spent the most on speakers, $61.5 million, even though its sales were about half of Pfizer’s.

“We continue to believe in the benefits and value that educational programs led by physicians provide to patient care,” Lilly spokesman J. Scott MacGregor said in an email.

The data provide a preview of what the public can expect to see in 2013, when all drug and medical-device companies — potentially hundreds — must report such figures to the federal government.

Until 2009, pharmaceutical company payments to health professionals were closely held trade secrets. But several companies began reporting the information publicly under pressure from lawmakers or as a condition of settling federal whistle-blower lawsuits.

Company	2010 Speaker Payments	2010 U.S. Sales
Lilly	$61,477,547	$14.3 billion
GlaxoSmithKline	$52,755,793	$13.6 billion
Pfizer	$34,382,574	$26.2 billion
AstraZeneca	$31,647,101	$18.3 billion
Merck	$20,365,446	$18.8 billion
Johnson & Johnson	$11,712,900	$12.9 billion
Cephalon	$4,241,080	$2.1 billion
ViiV Healthcare	$3,975,102	Unavailable

In October, ProPublica published a database called Dollars for Docs that included information from those companies. It allows the public to search for individual physicians to see whether they’ve been on pharma’s payroll.

Today, ProPublica is updating that tool to include payments made to health professionals by 12 companies. Eight of those published data for all of 2010: Lilly, GlaxoSmithKline, Pfizer, Merck, Cephalon, Johnson & Johnson, ViiV Healthcare and AstraZeneca.

In addition to the payments made to speakers, some of the companies also disclosed how much they’ve spent on consulting, travel, meals and research.

In all, payments to doctors and other health-care providers in ProPublica’s database total more than $760 million and cover reports from drug companies between 2009 and the second quarter of 2011.

Some Docs Pull Out

The new data offer a glimpse of how the firms have adapted their strategies over time, both to changes in the marketplace and to increased scrutiny of their sales techniques.

Many experts predict physicians will back away from working for the companies once their names and pay are publicly revealed.

It’s too early to know if this is true, but ProPublica’s analysis shows that the payouts to dozens of doctors and other health professionals took a steep dive last year.

Pulmonologist Veena Antony, for example, was paid at least $88,000 to give promotional talks for GlaxoSmithKline in 2009. But last year, the Birmingham, Ala., doctor gave them up out of concern that patients might think her advice was tainted.

“You don’t even want the appearance that I might be influenced by anything that a company gave,” she said.

Cancer specialist Nam Dang was a regular on Cephalon’s speaking circuit, pulling in $131,250 in 2009. But those promotional gigs stopped, he said, after he took a job at the University of Florida in Gainesville, which bans such talks. In 2010, he received $10,000 for consulting for Cephalon and Pfizer.

Nurse practitioner Terri Warren, who runs a Portland, Ore., health clinic, earned at least $113,000 from Glaxo in 2009, mostly talking about its herpes drug Valtrex. In 2010, that dropped to $300 after the drug went off patent and Glaxo no longer had a financial incentive to promote it.

“It’s a business decision, clearly,” said Warren, who felt her talks helped educate other health professionals about treating a taboo illness. “My money [from Glaxo] went into keeping this little clinic alive, and now we have to figure out some other way to do that.”

Another group of physicians has ramped up speaking engagements and consulting.

Buffalo hematologist Zale Bernstein earned $49,250 from Cephalon in 2009. The following year, his pay jumped to $177,800 (plus an additional $35,500 for travel). Bernstein did not return calls for comment.

Pain specialist Gerald M. Sacks spoke and consulted for four companies in the database and was among the highest paid. The Santa Monica, Calif., doctor earned $270,825 from Pfizer, Johnson & Johnson, Lilly and Cephalon in 2010, up from $225,575 in 2009. Those figures do not include travel costs and meals.

Over 18 months, Pfizer alone paid Sacks $318,250 for speaking. He did not return repeated calls for comment.

Pfizer’s new disclosure also revealed an unusual recipient. Its top-paid physician consultant last year, Dr. Christiana Goh Bardon, runs a hedge fund in Boston that bets on the rise and fall of health-care companies. She was paid nearly $308,000 to “provide input on our BioTherapeutics business development plan,” Pfizer spokeswoman Kristen Neese wrote in an email.

Bardon, who started her hedge fund after her Pfizer contract ended, was required to sign a confidentiality agreement and not allowed to invest in Pfizer or any of the biotech companies that Pfizer was looking at acquiring or partnering with for projects, Neese said.

Bardon said in a voice-mail message that she does not currently practice as a physician and her work was based on her business acumen.

Drug Companies Change Their Strategies

Some companies apparently have used fewer physician speakers and consultants since they began posting their data publicly.

Cephalon, a relatively small Pennsylvania company that specializes in pain, cancer and central nervous system drugs, paid physicians nearly $9.3 million in 2009 for speaking and consulting. That figure dropped to $5 million last year.

“There wasn’t one big thing that happened that shifted the focus,” said spokeswoman Jenifer Antonacci. Rather, the company’s marketing strategies for its brands changed.

AstraZeneca cut its spending on speakers from roughly $22.8 million in the first half of 2010 to about $9.2 million in the second half.

The company’s U.S. compliance officer, Marie Martino, said AstraZeneca typically holds most of its speaker events in the beginning of each year. But she acknowledged that the company’s spending on promotional talks has been decreasing.

“We’re in a period now where we don’t have a lot of new indications [approved uses] or new products that have been introduced in recent months, and that really is the fundamental explanation for what you’re seeing,” Martino said.

AstraZeneca, like other companies, is also replacing some in-person speaking events with teleconferences, webcasts and video conferences.

Glaxo’s spending on spea

kers also slowed in 2010, averaging about $13.2 million per quarter in 2010, down 15 percent from the last three quarters of 2009. (Glaxo did not report data in the first quarter of 2009.)

Company spokeswoman Mary Anne Rhyne said the company is working to reduce its speaker rolls by 50 percent. “We feel it is a better use of resources to use fewer speakers more often. This cuts down on training costs as well as lessens the number of contracts needed,” she wrote in an email.

And Lilly’s speaker payments dropped 10 percent from 2009 to 2010, which spokesman MacGregor said was likely due to “normal year-to-year fluctuation.”

ProPublica’s early analysis of the data is limited because so few companies report their spending and even then, disclose different information. Lilly, for example, reports every health professional it pays to speak, while Pfizer includes only those who can prescribe.

“It’s really unclear how much money is being spent in any one of these areas,” said Vincent DeChellis, a principal at NHHS Healthcare Consulting, which has studied the data. “As you get more and more companies participating and submitting this information, you’re going to get an initial look” at what may be a multibillion-dollar practice.

When Massachusetts required drug and device companies to report payments to doctors in that state last year, 286 companies did so.

Scrutiny of speaker programs has prompted changes.

After ProPublica reported last year that some drug-company speakers had been sanctioned by their state medical boards, the firms pledged to toughen their screening procedures and exclude physicians with disciplinary records.

Separately, ProPublica found that universities were not enforcing their own policies barring physicians from giving promotional speeches. In response, a number of schools said they would begin using the payment rosters to check for rule-breakers.

Pharma’s trade group said the focus of most companies right now is ensuring the accuracy of data that will be publicly released in 2013. But this transparency also must be put into context for patients, said Diane Bieri, executive vice president and general counsel for the Pharmaceutical Research and Manufacturers of America.

Doctors help develop new medicines, advise companies on marketing and help educate their peers about appropriate uses of new drugs, she said.

“If the only information that’s available is that company A paid doctor B $75,000 for a consulting arrangement,” she said, “that’s typically not enough information to really educate the patient about what was involved in that relationship.