December 10, 2010 · Leave a comment
Industry Insights from Paul Meade, M.Sc, MPH
For decades, the pharmaceutical industry has had a good working relationship with the medical profession. Of course, pharmaceutical companies have always been dependent on physicians writing prescriptions for their products, and for pharmacists filling these prescriptions, so ultimately the patients could return to health. This has been a true symbiotic relationship where pharmaceutical companies needed doctors to prescribe their drugs, and physicians had effective medicines to offer their patients.
Occasionally, there were a few bad apples on both sides of the equation that overstepped the boundaries of this relationship, but for the most part, it worked well. So what happened? Why the Sunshine Act? And why the apparent “witch-hunt” to expose every Thought Leader that engages with someone from a pharmaceutical company? Is it time for a course correction? Don’t we have bigger problems to deal with in the financial and economic arenas than to worry about how much money a Thought Leader made from conducting clinical studies or speaking at a conference on behalf of a pharmaceutical company?
Where did it all go wrong? How do we fix it? And what does the future hold for this pharma-medical relationship? Healthcare costs have been steadily rising in most countries across the globe. And while there have been increases in these costs, almost no other country has a high a cost for healthcare delivery than the United States. Healthcare reform has been on the political agenda of Presidents for over 20 years, prompted by the desire to do something about these rising costs. And despite the fact that drugs represent about 10-12% of the total healthcare bill, the public seems to hold negative sentiments about the industry. So when a respected Thought Leader in healthcare has been shown to have received several thousands of dollars from a drug company for a variety of consulting services, the public reacts with contempt and disdain for both parties. There are two burning questions concerning the issue of this pharma-medical relationship: what is a reasonable amount of compensation for services rendered by a Thought Leader, and what is a reasonable amount of absolute money a Thought Leader should receive from one or several pharmaceutical companies?
There have been numerous independent studies exploring the issue of fair and reasonable compensation for the types of consultative services provided by Thought Leaders, so I will forego discussing that topic. Suffice it to say that I believe fair and reasonable compensation has now been established and adopted by most in the industry. So how much should a Thought Leader make from drug companies? And that is like trying to answer the question, how long is a piece of string? Well, it depends! What are the activities being performed by the Thought Leader? How often is a Thought Leader consulted on medical issues? What is the value of the advice given to a company by a Thought Leader?
While it is true that some top global Thought Leaders can earn several hundred thousand dollars in consulting fees and clinical research compensation, it is also true that some make next to nothing from drug companies. Should academic medical centers or medical associations set the limits on what a Thought Leader can earn from consulting with the pharmaceutical industry? Many are attempting to do just that, place a capitation on what a physician can make from a company. Even some politicians are trying to limit compensation from drug companies. Is this an optimal solution to the issue? Not likely! Part of the problem was that some Thought Leaders were not disclosing what they received from drug companies, and when investigative reporters discovered some of the higher amounts received by physicians, they felt it was their journalistic duty to plaster it all over the front pages of local and national newspapers. Is this an optimal solution to the issue? Not likely!
So where do we go to fix this tarnished working relationship? The answer lies in the simple word, transparency. Companies become transparent in what amount of compensation they provide Thought Leaders, and Thought Leaders become transparent in what they receive from drug companies. Then there are no surprises when investigative reporters go snooping for a story. Will the pharmaceutical industry and the medical profession come to some agreement as to fair and reasonable limits to compensatory remuneration for appropriate services rendered? Yes, they will, if for no other reason than to appease the “witch-hunters.” Will the working relationship be restored to somewhat normal levels? Yes, it will, because neither party is going to disappear any time soon, and this symbiosis has worked well in the past. Of course, there will be changes to the rules of engagement, but in the end it will be for the better. So with the spirit of cooperation and transparency acting as guiding ethical principles, the future of Thought Leaders in healthcare will continue to play a vital role in the system of healthcare delivery.