As we noted last year, the United States Court of Appeals for the First Circuit concluded that a Vermont law, which banned data mining companies from selling prescription information to pharmaceutical companies, was unconstitutional. The decision was significant because another federal appellate court had previously upheld two similar laws in Maine and New Hampshire.
Consequently, the Wall Street Journal reported last week that the Supreme Court agreed to take the case to “decide whether states can bar the sale of doctors’ prescription data to drug companies, setting the stage for a ruling likely to affect one of the pharmaceutical industry’s most powerful marketing tools.”
Presently, “data companies such as IMS Health Inc. gather information from pharmacies on which medicines doctors are prescribing and how often. Drug makers buy the data, using it to refine their marketing pitches and measure which salespeople are the most effective.”
Vermont Attorney General William Sorrell who argued and lost the case in the Second Circuit said he looks forward to the Supreme Court arguments, which could come in April. He told WSJ that “Vermont doctors pressed for this law because of their concerns about privacy and because they view this data mining practice as an intrusion into the way doctors practice medicine.”
IMS Health and the other data-mining companies said the laws in Vermont and elsewhere “harm patients by making it more difficult to communicate timely and often vital information about new medicine and safety updates on existing medicine.”
It will be interesting to see how the Supreme Court handles this case given its conservative balance presently. The First Circuit found the Vermont Law particularly problematic because it sought “to alter the marketplace of ideas by taking out some truthful information that the state thinks could be used too effectively.” The court further explained that Vermont’s approach to regulating the interaction between detailers and doctors was premised on limiting the information available to physicians as a means of affecting their conduct. The First Circuit reasoned that “This approach is antithetical to a long line of Supreme Court cases stressing that courts must be very skeptical of government efforts to prevent the dissemination of information in order to affect conduct.”
In particular, the court noted that “The First Amendment directs us to be especially skeptical of regulations that seek to keep people in the dark for what the government perceives to be their own good.” Should the Supreme Court choose to adopt this reasoning, it is likely that the First Circuit ruling will be upheld and the laws in Maine and New Hampshire will be overturned.