Okay, maybe GlaxoSmith Kline did not phrase it exactly that way, but that is the end result as the company will no longer pay doctors to promote its drugs. Each year, GlaxoSmith Kline alone pays tens of millions of dollars to physicians in exchange for them promoting certain drugs to other doctors and medical professionals.
Why is this important? When Peyton Manning does a commercial for Papa John’s or Buick, we all know that he is being paid to endorse those products and we take what he has to say with that grain of salt. But, the same transparency does not exist in the doctor-patient context. Most doctors do not disclose to their patients that they have been paid by a particular pharmaceutical company to give speeches to other doctors at professional conferences and meetings. And since these pharmaceutical companies are paying huge amounts of money to doctors, it is not hard to see how their independent judgment about the best drug for the ailment might be affected.
In addition to stopping these types of payments, GlaxoSmith Kline will also restructure how it pays its sales representatives. Currently, drug company sales representatives get paid by how many scripts are written. To convince doctors to use their products, sales representatives are given huge expense accounts to wine and dine doctors with expensive dinners, catered lunches, golf outings, etc. Again, all of this activity tends to influence a doctor’s choice in which drug to prescribe a patient.
Many believe GlaxoSmithKline has decided to change its practices in the wake of a $3 billion dollar settlement last year involving qui tam or whistleblower actions.