Today, the 1st Circuit Court of Appeals issued a decision in IMS v. Ayotte, the case challenging New Hampshire’s Prescription Confidentiality Act, which prohibits the commercial use of prescriber data, including for pharmaceutical detailing. The Court unanimously upheld the law, finding that it did not violate the First Amendment. The opinion weighed in at a hefty 148 pages.

The Act sought to prohibit the practice of “datamining” for the purpose of pharmaceutical marketing: pharmacies sell doctors’ individual prescribing data (what drugs the doctors prescribed, when, and how often) to companies that aggregate such data. Those companies then sell prescribing “profiles” of individual physicians to drug companies, whose salespeople can then use that information to tailor the “pitch” that they use in marketing their drugs to those doctors. For instance, if a doctor has been prescribing a competitor’s drug, they might tailor the sales pitch to talk about why their drug is allegedly superior.

IMS Health, a company that collects and sells pharmacy data on doctors’ prescribing practices, sued the state of New Hampshire before the ink was barely dry on the law. They alleged that it violated their First Amendment rights. In April 2007, the U.S. District Court for the District of New Hampshire agreed, and struck down the law. The State of New Hampshire appealed the decision to the 1st Circuit Court of Appeals, which heard the appeal in January 2008.

Sean Fiil-Flynn, who represented PAL’s parent organization Community Catalyst, as well as AARP, National Legislative Association on Prescription Drug Prices, National Physicians Alliance, New Hampshire Medical Society, and Prescription Policy Choices in filing an amicus brief before the 1st Circuit, gave an excellent analysis of the decision and its ramifications:

The court unanimously upheld the New Hampshire law. The majority found that the act does not regulate speech, but rather regulates only the conduct of health information companies that aggregate and sell prescription records. The concurrence concluded that the Act does affect speech of pharmaceutical marketers, but the regulation is nonetheless justified by the state’s overriding interest in promoting cost containment in the pharmaceutical sector.

This is an important decision for data privacy advocates. The ramifications of giving companies a First Amendment right to sell data on all of our purchases, travel and activities would be staggering. The First Circuit ruled on the side of consumer privacy, admonishing that the First Amendment does not protect every exchange of information from traditional social and economic regulation. It refused to apply the First Amendment to the trading of prescription records for marketing purposes where “information itself has become a commodity.” The court explained that applying the First Amendment to such trade in prescription data “stretches the fabric of the First Amendment beyond any rational measure.”

The 148 pages of analysis exhaustively analyses the voluminous evidence amassed by New Hampshire demonstrating the negative effects on our health care system of allowing pharmaceutical marketers to use prescription record tracking to target their marketing efforts.

The court affirmed that states have a valid interest in regulating the use of prescription records to target marketing to doctors. The court found that the use of such information to identify doctors who prescribe lower cost drugs and target marketing campaigns at them has a demonstrable impact on pharmaceutical spending that states are not disempowered to respond to. Access to individualized prescription data also allows companies to target gifts, consultancies and other perks to their most favored physicians, in effect incorporating prescribers into the commission structure of their sales forces. These practices debase the medical profession and, the more the practices become public, break the chain of trust between doctor and patient.

Other resources:

  • The 1st Circuit’s decision is here
  • An Associated Press article on the decision is here: NH prescription privacy law upheld
  • The 1st Circuit Amicus Curiae brief of Community Catalyst and others is here.
  • The District Court Amicus Curiae brief of Prescription Access Litigation and others is here.
  • See also what PostScript, the blog of our colleagues at The Prescription Project, had to say about the decision.