Disclosure Pharma Money

This week, Senator Max Baucus and I detailed financial ties between a major pharmaceutical company and specialty medical groups that lobbied the Food and Drug Administration (FDA) against approving a generic drug.  The generic drug competes with a product of the pharmaceutical company that had sales totaling $2.9 billion in 2009.  The pharmaceutical company gave the specialty medical groups $5 million over several years, and those groups submitted letters to the FDA against the generic alternative through a citizen petition process.

Our report from the Senate Committee on Finance, and our follow-up letter to the FDA Commissioner, called for reforms.  These kinds of financial ties should be disclosed by medical groups who weigh in under the citizen petition process.  If the FDA isn’t requiring disclosure of financial relationships, it’s letting itself operate from an uninformed standpoint and failing to safeguard the credibility of its agency reviews.

Unnecessary delays in getting a generic alternative approved come at a high price.  A study by the nonpartisan Congressional Budget Office said that generic drugs reduced costs for consumers and the federal Treasury by approximately $33 billion in the Medicare Part D, or prescription drug program, in 2010 alone.

Achieving disclosure of payments from pharmaceutical companies to the medical community has been an effort of mine since 2007, when I discovered dramatic disparities between what some top federally funded research doctors reported they received from the drug industry and what the drug industry was actually paying them.

Since then, I’ve conducted oversight to hold individuals, organizations and even medical journals accountable for their ties to industry.  I’ve sought legislative reforms and support additional public reporting requirements.  Transparency is important for establishing accountability when input is gathered from experts.  Last year, a bipartisan bill I championed with Senator Herb Kohl of Wisconsin became law.  Starting next year, our reform will require pharmaceutical, medical device and biologic makers to report payments they make to physicians, and those reports will be made public by the Department of Health and Human Services starting in 2013.  Separately, the National Institutes of Health revamped its disclosure policies for those conducting $24 billion a year in taxpayer-funded medical research.  Many drug makers and advocacy groups have begun voluntarily reporting their financial ties in response to the scrutiny.