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Supreme Court to hear dispute over data from prescriptions

Can states bar companies from buying and selling nonpublic details about drug prescriptions?

January 08, 2011|By David G. Savage, Washington Bureau

Reporting from Washington — As states try to limit the marketing of costly new drugs, the Supreme Court agreed Friday to decide whether they can bar companies from buying and selling data on the prescriptions written by doctors.

The case presents the justices with a novel and potentially far-reaching question on whether nonpublic data can be protected by the government and shielded from release, or instead whether such data deserves to be freely bought and sold on the market.

When a patient takes a prescription from a doctor to a pharmacy, the information is not entirely private. Pharmacies sometimes sell the prescription data to drug makers without disclosing the names of the patients.

This data mining is a multibillion-dollar business, and drug makers say it is invaluable in helping them promote new drugs to physicians. Last year, the Pharmaceutical Research and Manufacturers of America said this data helps the industry "properly educate doctors about prescription drugs and their characteristics … in a more targeted and expedited manner."

But lawmakers in three New England states moved to halt the practice. They said the tracking of prescriptions "really interferes with the doctor-patient relationship and leads to more spending on expensive drugs," according to Maine state Rep. Sharon Treat, a Democrat, who is executive director of the National Legislative Assn. on Prescription Drug Prices.

Maine, New Hampshire and Vermont adopted laws that barred companies from selling prescription data to drug makers. They were sued by several data-mining companies that contended the sales ban violated the 1st Amendment by restricting the free trade of truthful information.

Lower courts split on the issue. The U.S. court of appeals in Boston upheld the laws from Maine and New Hampshire, but the U.S. court of appeals in New York struck down the Vermont law. The state may not "put [its] thumb on the scales of the marketplace of ideas," the New York court said.

The Supreme Court announced it would hear Vermont's appeal in Sorrell vs. IMS Health Inc. in April.

The data-mining companies say their information is useful to medical researchers and helps encourage the introduction of new drugs. Their lawyers note that in 1976, the Supreme Court struck down state laws that prohibited pharmacies from advertising their prices for drugs.

But Vermont's lawyers argue that the state's ban does not involve information that is communicated to the public. Instead, it is only marketing data, they said.

Beyond New England, about half the states, including California, have recently considered but not adopted similar measures, according to Vermont's lawyers.

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