07222017Headline:

Denver, Colorado

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Linda Chalat
Linda Chalat
Attorney • (866) 735-1102 Ext 366

Supreme Court Sides with Drug Companies

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The Supreme Court has struck down a Vermont law that prevented pharmacies from selling prescription information for drug marketing purposes, by a 6-3 vote. This case was a closely watched data-mining conflict pitting drug companies against consumers.

The case centered on prescription records purchased by data collectors from pharmacists, then sold to drug manufacturers. The data, collected according to federal rules and regulation, do not include patient names but cover information such as the physician’s name and address and strength of drugs prescribed, sufficient to allow pharmaceutical companies to track the illnesses physicians treat and their prescribing patterns. Vermont enacted its prescription confidentiality law on the premise that drug makers do not have an inherent right to a doctor’s identifiable prescription information for use in marketing because the data originated in highly government-regulated, nonpublic health care transactions.

Vermont argued that drug company sales representatives use the information to target physicians for new and expensive brand-name drugs that are not in the interests of patients or the state.

The 2007 Vermont law, similar to measures in Maine and New Hampshire, grew out of an effort by the Vermont Medical Society. Its members urged the Legislature to pass it after they became aware that prescription data mining was used by drug company sales reps in their pitches to physicians. Thirty-five states, along with the Justice Department , joined Vermont’s defense of the law.

But the justices said the law violated the First Amendment by targeting certain information and particular speakers, specifically pharmaceutical manufacturers and so-called detailers who visit physicians’ offices and engage in marketing on behalf of drug companies. In an opinion by Justice Anthony Kennedy, the court said such pharmaceutical marketing deserved heightened free speech protection that could not be overcome by Vermont’s arguments about medical privacy or marketing that may lead to more costly prescription choices.

The three dissenting justices said the majority put too high a regard on commercial speech and denied legitimate state concerns regarding public health and escalating medical costs.

It is quite evident from the recent USC opinions that the majority on this court will only trump state rights when in conflict with Big Business.