It's not that there is no free lunch for doctors, there are just fewer of them.
Some members of Big Pharma are significantly cutting their budgets for spending on docs as lost sales and resulting downsizing lead to fewer pharmaceutical sales reps to pick up lunch, The Wall Street Journal reports. Eli Lilly ($LLY), which Thursday said it would cut 30% of its sales staff in the U.S. is the most recent example of that. The cuts in payments by some drugmakers also comes ahead of a new transparency requirement next year for how much they pay to physicians for everything from speaker fees to research.
The final rules came out in March but only after 15 months of delay and following an outpouring of criticism from groups who said patients deserved to know if their docs were on a drug company's payroll.
Pfizer ($PFE) last year cut payments to U.S. doctors by 11%, down to $173.2 million in 2012, including spending 40% less on meals for docs, WSJ said. Dr. Soumitra R. Eachempati, a frequent speaker for Pfizer on antibiotics received only about $6,000 in fees last year, down from more than $32,000 the year before. "Drug companies are going in a different direction from a marketing standpoint," Dr. Eachempati told the newspaper, noting that drug reps are showing up less often with lunch at his office.
GlaxoSmithKline ($GSK) cut payments to U.S. physicians by 20% last year, to $97.1 million, but AstraZeneca ($AZN) and Johnson & Johnson ($JNJ) both upped the amount they spent. The publication found some comparisons difficult to make. Much of the money companies spend is for R&D. For example, Merck ($MRK) said that 80% of the $225 million it spent in the U.S. on health-care professionals last year was for clinical research.
Even so, there are many critics of the potential for drug company to influence what drugs physicians prescribe their patients who are cheering a move to more public disclosure. "It is possible the trend we've seen for a few years toward increasing focus on payments will continue, and both providers and companies" will think again about the financial tie-ups, Allan Coukell, of the Pew Charitable Trusts, told the WSJ.
- read the Wall Street Journal story (sub. req.)