Doctors on the Take: Aligning Tort Law to Address Drug Company Payments to Prescribers

Abstract

The pharmaceutical and medical device industries aggressively market their wares to health care professionals, and the giving of gifts has become a central feature of this process. Most observers regard financial incentives tied to the use of specific therapeutic products as ethically impermissible, and various institutions have tried combating inappropriate gifts and payments to physicians: medical and industry groups adopted voluntary codes, federal agencies published advisory guidelines, and, most recently, state and federal legislatures enacted reporting laws. Self-regulation, threats of prosecution, and transparency initiatives have tempered the practice, but manufacturers continue to find clever ways of purchasing the loyalty of prescribers. Fairly minor modifications in tort doctrine might help to discourage such payments. Courts could include potential conflicts of interest as material information that health care professionals must reveal when securing consent from their patients, but expanding the duties of drug and device manufacturers to convey warnings directly to patients offers a more promising way to curb gift giving. The prospect of having to communicate complex risk information to laypersons might make companies think twice before lavishing gifts and payments on physicians, which in turn would help to ensure that those “learned intermediaries” continue to serve the best interests of their patients.

JEL Classification: K13, I18, M38