Vermont Law Blocking Prescription Data Mining Overturned

June 27, 2011
Michael Fitzhugh

Drug companies are allowed use your prescription records to tailor their drug pitches to you. The U.S. Supreme Court just overturned a Vermont law that made that sort of data mining illegal.

This article published with permission from The Burrill Report.

Under Vermont’s law, prescriber-identifying information cannot be sold by pharmacies, disclosed for marketing purposes, or used for marketing by pharmaceutical manufacturers unless doctors give their approval. The court’s 6-3 decision to overturn the law removes a barrier to collecting doctors’ prescribing data in the state, making it easier to collect comprehensive data to support drug marketing efforts.

Detailed prescribing data, stripped of patient names but not the names of doctors, is sold to data miners by pharmacies nationwide. IMS Health sued Vermont on behalf of itself and other data collectors to block Vermont’s Prescription Confidentiality Law. It uses prescribing data to create detailed pictures of which doctors prescribe what products. Such analysis is then leased to pharmaceutical companies, which use it to optimize their marketing strategies and increase sales to doctors.

SDI, Source Healthcare Analytics, and the Pharmaceutical Research and Manufacturers of America joined IMS in challenging the law.

Vermont argued that the law safeguards medical privacy and makes it harder for doctors to be steered toward prescribing practices that are not in the best interest of patients or the state. “It can be assumed that these interests are significant,” wrote Justice Anthony Kennedy. “Speech in aid of pharmaceutical marketing, however, is a form of expression protected by the Free Speech Clause of the First Amendment.”

Justices Stephen Breyer, Ruth Bader Ginsburg, and Elena Kagan dissented in the case. Breyer, writing for the minority, said that the Vermont statute affects expression in just one way, preventing pharmaceutical companies and data miners from using data to create better sales messages, a prohibition he views as “a lawful governmental effort to regulate a commercial enterprise.”

The ruling is “clear and unmistakable,” says Harvey Ashman, IMS Health’s senior vice president and general counsel. “The availability of information on the prescribing practices of physicians enables communications about new medicines, best practices and safety updates.”

In addition to supporting marketing efforts, IMS says its data is used to study prescribing trends, monitor the safety of new medicines, prevent prescription drug abuse, recruit patients for clinical trials, and assess treatment variability.

IMS says that it believes that laws in Maine and New Hampshire that are similar to the Vermont law are now likely to be declared unconstitutional or repealed following the decision.

The U.S. Supreme Court has ruled that a Vermont law blocking pharmaceutical data mining companies from using doctors’ prescription records to tailor drug sale pitches without their consent violates the First Amendment.

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