State Senate Passes Bill Banning Drug Company Gifts to Doctors

The California Senate just passed a bill that would ban pharmaceutical companies from giving gifts to doctors. The bill, SB 790, is modeled on a Vermont law enacted in 2009 banning pharmaceutical companies from giving perks to doctors.

If the bill is signed into law, doctors would no longer be able to receive perks from drug companies. According to the sponsor of the bill Senator Mike McGuire, the bill would lower healthcare costs, in part because doctors who receive gifts are more likely to prescribe costly drugs.

A recent UCSF study showed that doctors who receive industry gifts such as meals, travel, speaking fees and royalties were two to three times more likely to prescribe costly name-brand drugs than equivalent lower priced generic drugs in their specialty.

Similarly, a Harvard Medical School study found that Massachusetts physicians prescribed a larger proportion of brand-name statins — the category of drugs that treat high cholesterol — the more industry money they received.

At least eight other states and the District of Columbia, join California’s largest hospitals such as Kaiser, the University of California Medical Centers, and Stanford which have already implemented policies restricting or outright banning pharma company gifts to doctors. But, data shows that California physicians, in 2014, received the highest number of gifts and payments from pharmaceutical companies of any state – at $1.44 billion.

State Sen. Ed Hernandez (D-Los Angeles), an optometrist, said the bill is a simple measure that will curb drug costs.

“As a provider myself, I have no problem not accepting any gifts from any pharmaceutical company that comes trying peddle their drugs in my office,” the Democrat said.

Others spoke against the bill, saying drug companies need to market their products to be successful and ensure new treatments reach patients.

“Successful products provide the funding for the research, for cures,” said Sen. Ted Gaines (R-El Dorado). “Why would we do anything to diminish the ability of pharma companies to be successful in providing these new products?”

McGuire said it is about making the patient the priority.

“There’s a reason why doctors answer the call to practice medicine — to help people in their time of need,” McGuire said. “But growing evidence reveals that financial relationships between some physicians and pharmaceutical companies confirm what has been suspected – financial incentives change minds.”

We informally polled a number of our physician clients who seemed to be unconcerned about the bill, saying that it would not “make any difference” in their prescribing practice, and that “gifts are never the driving factor.”

The bill now proceeds to the full Assembly for further debate and a vote. If it passes the Assembly, it goes to the Governor for signature.

We will update this post with any further legislative developments.