March 24, 2005
The Ethics of Kickbacks
Recently, Doctor Andy addressed the idea of pharmaceutical reps entertaining doctors, giving them freebies, etc to reward the doctors prescribing their drugs. He specifically mentioned that if the freebies are given as a quid pro quo for prescribing those medications, it would therefore be unethical:
Consider a similar scenario. Dr. Morrow sees a patient and appropriately prescribes a course of expensive medication. Dr. Morrow acts of pure intention, prescribing what he believes to be the most appropriate treatment. Two days later, a drug rep from the pharmaceutical company who makes the expensive treatment calls to offer an expensive gift, say dinner for two at a fancy restaurant, as a “thanks” for prescribing the treatment. Can Dr. Morrow accept?
I think not. Doing so would call into question his motives and could be seen as a sort of bribe. The drug company is rewarding him not for doing the right thing, but to encourage use, appropriate or not, of its product.
This article wouldn’t have piqued my interest, but I saw a similar idea put forth at TF Stern’s site. TF is a retired police officer, who now works as a locksmith. In order to keep his name in front of the people who are in a position to recommend locksmiths, he keeps a somewhat similar practice:
I get quite a few of my retail customers as referrals from many different sources. I have folks who work in service departments and parts departments of various car dealerships all over town. They give my name and phone number out when a locksmith is needed. Hopefully it’s because they know that I will do my level best to satisfy their customer’s locksmith need, based on the quality of work I have done in the past. There is another reason why they remember my name; I make sure to say, “Thank you for the referralâ€.
Saying, “Thank youâ€, doesn’t cost me anything. It does require a conscious effort on my part to remember that these calls could just as easily been given to some other locksmith. Every once in a while I will take them a berry or apple pie that Lucy has set aside, or take them a half gallon of Blue Bell Ice Cream as a way of putting an exclamation mark on the meaning of “Thank Youâ€. I know who likes blue berry pie, Oreo cookies, chocolate ice cream and make it a point to drop off that confectionary delight when the time is right. During Baseball season I will often hand out some tickets to an Astros game; mind you, these will be in the “nose bleed†section; I’m not rich. The interesting thing is that none of these people expect these extra tokens of appreciation; they would have done the same thing without them.
The question is, what is the difference between what a pharmaceutical rep is doing, and what TF is doing? I submit that there is no difference in reality.
Those who consider the first situation unethical have made an additional assumption. They are assuming that the doctor is choosing that medication, to the detriment of the patient, or as a substitute to a better medication. I don’t believe that an ethical doctor will choose a medication for a patient that is unsuitable to treat their disease, he is only choosing the specific medication that he is most familiar with. A doctor is not there to push expensive medications on patients who don’t need them, and to assume that doctors are willing to sacrafice their own patients needs out of a sense of “duty” to a pharmaceutical rep is ludicrous. As Alan Alda said last night on The West Wing, “If you can’t drink their booze, take their money, and then vote against them, you don’t belong in this business.” Doctors understand that their responsibility is to patients, and an expensive dinner here or there doesn’t make them forget this.
For locksmiths like TF, there are a lot of good locksmiths out there. TF may believe that he has certain competitive advantages, a more professional personality, or even more technical skill than others in his profession, but many other locksmiths could also complete the jobs he is offered. But TF is in a business that is heavily based upon referrals. Rewarding those who refer you (sometimes in advance), and doing everything you can to keep your face in front of them is key to getting more work. To the automotive servicemen, one random locksmith is as good as another, but personal relationships with someone like TF are going to make him the first name offered to a customer.
Of course, the argument against this is that medicine is different. To that I say, how? Typically there are several medications available for any given malady. For example, cholesterol medications like Lipitor and Vytorin will both lower your cholesterol. For an average patient, they’ll work equally well. Small subsets of people will have problems with Lipitor, and small subsets will have problems with Vytorin, and usually a doctor cannot tell which is which. When the Lipitor rep comes to visit your doctor, with free samples and maybe a free lunch or dinner, all they’re doing is giving the doctor the impetus to choose Lipitor instead of Vytorin, next time he is faced with a patient who needs medication for high cholesterol. He won’t start prescribing Lipitor to people who don’t need it, and if there is a generic substitute available for Lipitor, he likely won’t tell the pharmacy not to substitute the generic. For this patient, he would choose between prescribing Lipitor or Vytorin anyway. So where is the ethical problem here?
What TF is doing, and what the pharmaceutical companies are doing, is advertising and marketing. They do this because to do so alerts customers to their existence, and bringing in customers allow them to continue to operate. For TF, that means that he can take a vacation with his wife, buy the sports car, etc. For a pharmaceutical company, that means that they can continue the R&D efforts to design new drugs that will save us from countless other maladies down the road. To those on the left, whose modus operandi is to ascribe the worst motives to anyone associated with business or commerce, calling this “unethical” is par for the course. To those of us who understand that capitalism and competition will end up enriching us all, we understand a simple fact: Creating a product doesn’t mean squat unless people who need the product know about it. Free giveaways are nothing more than a means to that end.
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Interesting comparison, locksmiths, drug companies and the West Wing. Most of what I wanted to say in my own blog was that it doesn’t cost anything to be polite, to say thank you or even throw in a small trinket such as a pie. I suppose that the pie could be considered “payolaâ€; but that would be a pretty good stretch. I would agree that keeping my name out there is important to success, as would any self promotion; however, that was not the purpose of saying, “Thank Youâ€, even if it does serve that end. Being Civil has everything to do with, “Thank Youâ€. So, Thanks for linking to my blog. ( and you can forget any chance of getting a pie)
A few poins.
IMHO, there is one big difference between the two scenarios. A doctor is well compensated to provide his services to patients and they rightly expect him/her not to have other incentives, like expensive dinners. The folks recommending the locksmith have no particular duty to the potential customers. If I hired someone to choose a locksmith and then found out that person was taking kickbacks from the locksmith they chose, I’d be mad as hell.
I also don’t share your benign view of doctor’s motives. A number of studies have shown that doctor’s are quite sensitive to economic incentives.
I do agree that small tokens of appreciation (a thank you, a pie, etc.) are probably okay in either situation, but once we start talking cruises and vacations I get a bit worried.
I’m thinking that malpractice ought to be grounds for suit, but not gift exchange. This is akin to drug use, in that opponents fear acts that are already criminal…beyond the act of self abuse.
My thoughts exactly, Robert.
Hi all,
) Thanks.
it was really interesting to read your comments. First af all, I´d like to react (very shortly) on this issue; Brad, Robert you´re right!
I found this “blog site” browsing the Internet in order to find a topic for my research paper. Finally, I have found it
By the way, I am from the Slovak Republic and your issue seems to be the same in our republic.
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