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Brand-Name Rx Rise After Docs Get Drug Company Perks: Study

HealthDay News
by -- Robert Preidt
Updated: Feb 21st 2020

new article illustration

FRIDAY, Feb. 21, 2020 (HealthDay News) -- American doctors prescribe more brand-name medications after they get a free lunch or other incentives from drug company marketers, a new study finds.

Researchers analyzed drug prescribing between 2013 and 2015 for a large sample of enrollees in Medicare Part D. The federal program, which subsidizes prescriptions for 37 million seniors and disabled people, accounts for nearly one-third of U.S. retail prescription drug sales.

That data was compared with a database in which drug companies report incentives provided to doctors, including meals, travel or continuing education expenses.

While those incentives tended to be modest -- 95% were meals, of which 80% were valued at less than $20 -- they were common and had an impact, according to the study.

More than 20% of Medicare Part D expenses on brand-name medications came from doctors who received an incentive related to a drug they prescribed. Nearly 30% of physicians got an incentive for at least one drug they prescribed during the study period.

"The prevalence of the practice implies that the financial impacts are economically large," the authors wrote in the working paper released Feb. 17 by the National Bureau of Economic Research.

Colleen Carey, an assistant professor of policy analysis and management at Cornell University, is the study's first author.

She and her colleagues estimated that for every additional dollar that drug companies spent on marketing visits, they could expect $2.64 more in drug revenue over the next year. That's a 164% return on investment.

That wasn't as high as previous estimates, which ranged from 200% to 1,700%, the researchers noted.

They also found that marketing visits by drug company reps don't lead doctors to prescribe higher-quality drugs, as the drug industry claims.

"We took seriously the claim that there is educational value to these marketing encounters," Carey said in a Cornell news release. "We just don't find any evidence for it."

More information

Santa Clara University has more on drug company gifts to doctors.




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