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Vermont Acts to Make Drug Makers’ Gifts Public

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Under a new Vermont law, drug and device manufacturers will have to publicly disclose all gifts (in direct payments, speaking and consulting fees, grants, food, lodging and transportation, and books) they make to healthcare providers. The law will require specific disclosure of doctors’ names, dollar amounts, and the medical products to which the spending is pegged. The state’s previous law required only general information. The law will also ban free meals for doctors, which currently make up 29% of the $2.9 million in payments made by medical product companies to doctors in Vermont.

The New York Times believes that the law, scheduled to take effect on July 1, is the most stringent state effort to regulate the marketing of medical products to doctors. It would also ban nearly all industry gifts to doctors, nurses, medical staff, pharmacists, health plan administrators and healthcare facilities.
In practice, the new law would let Vermonters learn each year which doctors have been paid, and how much, by the makers of the brand-name drugs for which they wrote prescriptions—or how much money certain surgeons have received from the makers of the stents, pacemakers, artificial knees, etc., that the doctors implanted.

National legislators and medical groups looking for links between industry marketing and health care costs are taking a careful look at Vermont’s action. In Congress, Sen. Charles Grassley (R-IA) and Sen. Herb Kohl (D-WI) have cosponsored a bill requiring disclosure of pharmaceutical industry payments to doctors.
But Vermont has gone further with its new law, which Gov. Jim Douglas, a Republican, is expected to sign by early next month. It will require public disclosure of all payments by companies to any health care provider with authority to write prescriptions for drugs, medical devices and biologics, drugs that are typically administered by injection or infusion.
The law also closes a loophole in previous regulations that had allowed companies to keep specific expenses private by claiming them as trade secrets. However, the required disclosure does not include payments for clinical research on products under review by FDA.
The Vermont law promises to provide a window into the considerable efforts and spending by device and drug makers to woo doctors even in a small state. “If the drug industry gives $3 million on average for three years now to physicians in a small state like Vermont, what is happening in California and New York?” said Ken Libertoff, director of the Vermont Association for Mental Health, an advocacy group that supported the law.
Peter Shumlin, president pro tem of the Vermont state senate, said he hoped his state would provide a model on marketing disclosures for the rest of the country. “Our goal is not to prohibit this practice, but to have the first system in this country where providers’ acceptance of this money is on full public record.”

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