Don’t carry on, doctor!

The Hindu Business Line, January 17, 2014

By Pradeep S Mehta

The nexus between the pharma industry and doctors needs to be broken

A doctor friend and his wife said that a pharma company had paid for their recent trip to to Bali. This was standard practice, the doctor said, rather nonchalantly. The idea, he explained, was to feel sufficiently incentivised to prescribe their medicines.

I did not ask for the name of the company. But in future GlaxoSmithKline (GSK) will probably stop paying for his and his wife’s holidays.

Britain’s largest pharmaceutical company, GSK, has just said it will stop offering allurements to doctors to promote their drugs. It will also stop linking the bonuses of sales staff to the number of drugs they sell. This is a much appreciated initiative from a leading player in an industry that has for long been accused of unethical sales and marketing practices by governments and regulators.

Perhaps GSK adopted such a policy because it was hammered by Chinese authorities for bribing doctors, hospitals and government officers. GSK was accused of paying $490 million to various travel agencies, using them as intermediaries to facilitate bribes to doctors and officials.

Last year, GSK paid the US government $3 billion to settle charges of illegal drug promotion, failure to report safety data and false price reporting. It was the biggest fine paid by a drug firm in US history.

In the past five years, leading pharma companies, including GSK, Pfizer, Johnson & Johnson, AstraZeneca, Merck, Abbot, Eli Lilly and Allergen, have paid about $13 billion in fines to settle charges of misleading marketing and bribery of doctors to get their drugs prescribed

Indian Scenario

This unholy nexus between the pharma industry and medical professionals has been debated in India for several years. In a survey carried out by CUTS International in 1995, over 2,000 prescriptions were collected by consumer groups of West Bengal, Rajasthan, Gujarat, Maharashtra, Tamil Nadu and Andhra Pradesh.

The survey revealed that there was a gross tendency to prescribe useless medicines, like tonics, restoratives, vitalisers and vitamin formulations. Sixty per cent of the prescriptions were considered to be irrational in various ways. In another CUTS study in select districts of Assam and Chhattisgarh in 2010, it was found that a mere 20 per cent of consumers surveyed obtained medicines from public hospitals, as doctors in these hospitals prescribed expensive drugs of certain companies which were available only in private chemist shops.

Promotional practices are mainly of three types: information and brand reminders, incentives and inducements to prescribe, and cash payment and bribes to increase sales.

While it is illegal for doctors in India to accept cash gifts, enforcement of the law is rare. Further, there is no direct regulation of the pharmaceutical companies which offer bribes to healthcare providers. Last year, the Department of Pharmaceuticals introduced a code for pharmaceutical marketing practices, but it is voluntary in nature.


According to the Parliamentary Standing Committee on Health and Family Welfare, India’s top drug regulatory agency, the Central Drugs Standard Control Organisation (CDSCO), indulged in serious irregularities in the drug approval process. CDSCO, which oversees clinical trials, was accused of approving medicines from companies without requisite clinical trials and without seeking expert medical opinion. This appears to be a classic case of regulatory capture.

Self-regulatory measures are crucial for an industry battling scandals over its sales marketing practices. In Saudi Arabia, when a policy on prescription audit was announced in late 1980s, irrational prescriptions fell by 40 per cent.

(The author is Secretary-General, CUTS International. Vikash Batham of CUTS contributed to this article.)

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