Physician payments are gray area for UGA Solicitation Policy

  By John Hammel, Amy Libby, Chelsey Shirley and Killian Wyatt Doctors at the University of Georgia Health Center (UHC) accepted $2,228 in payments from pharmaceutical companies between 2013 and 2015, creating a potential conflict with the university’s solicitation and ethics policies. The majority of these payments were for food and beverages. Payments to UHC […]

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Sidebar: Lawsuits and pharmaceutical companies

A number of the pharmaceutical companies who have made payments to University of Georgia Health Center physicians have settled multi-million dollar lawsuits with the Justice Department in recent years for crimes involving illegal drug marketing and payments to physicians. 
The University Heath Center was not involved in any of the lawsuits and there is no evidence of any wrongdoing on the part of UHC employees. 
These criminal cases are relevant, however, because they reveal a pattern of deliberate efforts on the part of many pharmaceutical companies to either bribe or mislead physicians into prescribing their medications. 
In 2008, Otsuka American Pharmaceutical Inc. agreed to an over four million dollar settlement with the United States Justice Department to resolve allegations they marketed their drug Ambilify for off-label uses. Between 2005-2008, the Justice Department cited Otsuka for knowingly promoting Ambilify for pediatric use and dementia-related psychosis. Otsuka allegedly directed its sales force to specifically target child psychiatrists, pediatric specialists, and physicians and encouraged providers to prescribe Ambilify for pediatric patients. According to the Justice Department, because of the potential market benefit, the long term care sales force promoted Ambilify off-label for the treatment of dementia-related psychosis.” 
In 2015, Warner Chilcott LLC agreed to plead guilty to a felony charge of health care fraud. The $109 million settlement was part of a larger global settlement totaling $125 million for its illegal marketing of seven drugs, including the birth control Loestrin. Warner Chilcott admitted to the felony act of paying kickbacks to physicians throughout the United States to encourage them to prescribe their drugs. The government reported that the company’s management- including the former President W. Carl Reichel who plead guilty to one count of conspiracy to provide kickbacks to physicians directed its sales teams to pay remunerations” to physicians who would prescribe Warner Chilcott drugs.  
The Justice Department cited the company for hosting fake Medical Education Events” that proved to only be opportunities to pay physicians in the form of meals, dinners, and lunches at expensive restaurants in order to induce prescribing practices and gain competitive advantage.
The case did not outlaw payments for food and beverage”, the most common payment to UHC physicians, within the industry all together. Rather, the courts have affirmed that meals, like many other forms of non-cash remunerations, could be considered illegal kickbacks depending on the circumstances. 
In 2010, the company Allergan Inc. was forced to pay a $600 million dollar settlement for off-label marketing of their drug Botox. They doubled the size of [their] reimbursement team
to assist doctors in obtaining payment for off-label Botox® injections,” according to the Justice Department. They engaged in other illegal marketing practices such pressuring doctors to make diagnosis for cervical dystonia (a diagnosis they focused their off-label scheming on) despite the absence of any clinical signs of cervical dystonia. Allergan held professional workshops and dinners for physicians to encourage off-label prescribing, paid doctors to be on advisory boards” that focused on off-label uses, and enacted hotlines and reimbursement offices to help physicians get reimbursement from insurance for off-label prescriptions in order to encourage the practice.  
Sanofi US agreed to a $109 million settlement with the Justice Department in 2012 over violations of the Anti-Kickback Statue of the False Claims Act. Sanofi allegedly gave physicians free units of the drug Hyalgan to persuade them to prescribe the drug to patients. 
These court cases, and others like it, should give physicians pause even when they’re receiving legal payments from pharmaceutical companies, according to Dr. Banja. 
“Let’s face it, that [pharmaceutical representative] is profoundly conflicted,” said Dr. Banja, for the obvious reason, that they want to sell their drugs as much as possible.” 
By: Amy Libby
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Physician Payment Sunshine Act

A provision of the Affordable Care Act introduced an online transparency tool called Open Payments, but many patients are unaware the tool exists.

This provision is called the Pharmaceutical Payments Sunshine Act and it requires medical product manufacturers to report certain payments they make to physicians. These payments are recorded annually by the Centers for Medicare & Medicaid Services and posted publicly on the Open Payments website. The program took effect in April, 2013.

“This is all about doctors being influenced,” said Dr. Barbara Schuster, the former dean of the University of Georgia Health Sciences Campus.

Payments have the potential to impact a doctors decision making. Meals, plane tickets and even ads in medical journals are subtle influencers on a doctor, she said. “Well, why would they put an ad in if they didn’t think it would be influential?”

Dr. Molly Candon, a health economics researcher at the University of Pennsylvania, said the Open Payments website is a useful consumer tool. Payments to doctors can influence their decision making, she said, and the Open Payments website makes these relationships transparent to the public.

“Unfortunately patients aren’t using it,” said Candon.

Schuster said most patients do not care about pharmaceutical payments to their doctor.

“Mr. Joe out there, he’s never going to look that up and find out what his orthopedist is getting,” said Schuster. “He doesn’t care.”

The Physician Payment Sunshine Act was not the first transparency program of its kind. Some states introduced sunshine laws before the federal law passed, said Candon.

Massachusetts has had a physician sunshine law on the books since 2009. Research in the state has shown that simply having a policy on pharmaceutical gifts reduces the likelihood of marketing, said Candon.

How Does the Open Payments Program Work?

Medical companies making payments to doctors must report the payments to the Centers for Medicare & Medicaid Services on an annual basis or face fines for noncompliance. Doctors who receive payments are not required to report anything.

The Centers for Medicare & Medicaid Services aggregates the data and posts it publicly on the Open Payments website.

Medical companies must categorize all the payments they report. Among other categories, payments can take the form of consulting fees, compensation for services, gifts, food and beverage, travel and lodging, education, or research.

Candon said the two largest payment categories are food and beverage and compensation for services. Food and beverage payments are the most frequently reported category, she said, but compensation for services accounts for the largest dollar amount.

Once the data is posted publicly, visitors can enter a physician’s name, address, and specialty and search the website for a match. If a physician has accepted a payment, their name will appear along with a summary of the dollar amount they accepted and the name of the company that made the payment.

Currently, the website has data available for payments made between 2013 and 2015.

Limits to the Open Payments Program

The Open Payments website is a valuable tool, but it has limitations said Candon.

Payment summaries on the website do not take into account how many patients a doctor sees. Naturally, the more patients a doctor sees, the more likely that doctor is to prescribe medication, said Candon.

The existence of financial ties alone does not signify an inappropriate relationship between doctors and medical companies, said Candon. When discussing payments to physicians, many people think, “this is bad. It’s someone’s fault,” said Candon. “Not necessarily. There’s also a transfer of information.”

Doctors can learn new medical techniques at a conference sponsored by a medical company, she said.

It is very difficult to measure the prescribing habits of physicians, said Candon. Researchers face a fundamental question: do physicians become better or worse prescribers after accepting a payment from a pharmaceutical company?

“That’s impossible” to answer, said Candon, “unless there’s a fly on the wall.”

By: Killian Wyatt

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What is a formulary?

When University of Georgia students pick up a bottle of cough syrup for bronchitis or some mucinex during allergy season they may not be aware of just how extensive the pharmacy at the University Health Center is.

The formulary at the University of Georgia Health Center includes items ranging from Icy Hot vapor gel to the rabies vaccine. In fact, the University Health Center formulary has approximately 2,600 items including syringes, pharmaceutical drugs, medicated shampoos and sprays.

What is a formulary?

According to the website Medicare Made Clear, “A formulary is the official name for a list of drugs that are covered by a plan. The goal in creating a formulary is to identify drugs that are both medically appropriate and cost-effective to serve the interests of the members of that plan.”

When choosing a formulary for a pharmacy, the pharmacy benefit manager has the final say in what drugs make it onto the list, said John Norton, director of public relations at the National Community Pharmacists Association.

Norton said that pharmacy benefit managers are third party companies which use their size to act as middlemen between pharmaceutical companies and pharmacies.

“When it comes to the formulary, the pharmacy benefit manager a lot of times will go forward with a drug because the manufacturer will give the PBM a rebate … there’s not much accountability,” Norton said. “PBM’s are not very transparent.”

PBM’s are supposed to pass the saving of this rebate on to the pharmacy but this doesn’t always happen Norton said.

Executive Director of the University Health Center Jean Chin said that at the University of Georgia UHC the decision of what goes on the formulary is decided by a committee.

“There is a deliberate process which involves the Pharmacy and Therapeutics Committee and ultimately requires approval by the medical staff,” Chin said.

What is on the University of Georgia’s formulary?

According to, between the years 2013 and 2015, over $2,200 in food and beverages as well as speaking and education payments were reported by various pharmaceutical companies to be given to doctors at the University Health Center. These numbers are reported by the pharmaceutical companies themselves by law and often list the names of various drugs or products in the account of payment.

Many of the brand name drugs which are mentioned in these accounts of payment also appear on the University of Georgia’s health center formulary, including Fluzone, a leading influenza vaccine which gave out over $100 to University Health Center employees in the form of food and beverages. Adacel, a diphtheria and tetanus vaccine was also mentioned in the account of these payments.

Other drugs mentioned in payment accounts from pharmaceutical companies to University Health Center employees include Latuda, a drug which treats schizophrenia, Brintellix, which treats depression, and Cialis which treats erectile disfunction.

Out of the 13 name brand drugs which are mentioned by name in payment accounts to University Health Center employees, 9 are stocked in the pharmacy according to the formulary. The four drugs not listed in the formulary are Ambilify, Axiron, Teflaro and Tanzeum.

According to the website SafeMedication by the American Society of Health System Pharmacists, hospitals and pharmacies often only stock a few of the same type of drug as stocking every drug approved by the FDA would be impractical.

“You may know about the cholesterol-lowering medications known as “statins” (brand names include Zocor®, Lipitor®, Mevacor®, Crestor®, Pravachol®, and Lescol®). Your hospital may choose to keep just one or two of these on the formulary and in stock,” wrote Marlaine Mance, a pharmacy clinical coordinator for Memorial Hospital, in an article on SafeMedication.

A few of the competitors of the drug companies which reported payments to University Health Center employees are also represented in the formulary. For example the antidepressant Brintellix shares the list with the similar antidepressant Vilazodone. Likewise the competitors Fluzone, which is listed in payments, and Flumist, which is not, are both on the formulary. However, the University of Georgia did not report the rate at which each drug is prescribed from the formulary so it is unknown if certain brands are prescribed over others.


Note: Multiple drugs could have been mentioned in multiple accounts of payment in which case the value is represented in the totals of both drugs. Note: Contact lenses and other medical devices listed were mentioned in accounts of payment and are distributed by the UGA UHC but are not present in the formulary provided by the University of Georgia.

By: John Hammel

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