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Legal News
‘Data Mining’ Ban Violates Free Speech, Court Rules
Psychiatric News
Volume 46 Number 1 page 1-25

A Vermont law that limited third-party access to physicians' prescribing data was struck down by a federal appeals court as unconstitutional last November. However, the issue will likely move to the U.S. Supreme Court because that ruling conflicts with earlier rulings by a different federal appeals court that upheld similar laws in two other states.

The U.S. Court of Appeals for the Second Circuit Court, located in New York City, ruled that the Vermont law, which required physicians to consent before their prescribing data could be sold, licensed, or exchanged as a tool for promoting or marketing medications, was "an improper restriction on commercial free speech."

The Vermont law limits the sale or use of prescriber information to certain specified activities, including for pharmacy reimbursement, patient care management, and health care research. The law was challenged by three companies that compile physician prescribing data and sell the information to pharmaceutical manufacturers.

The state's lawyers argued that the law restricts conduct—not speech—and that the data miners are buying and selling a commodity, which can be regulated under powers the U.S. Constitution gives to the states. The three appellants in the case, IMS Health, Verispan (now SDI), and Source Healthcare Analytics, which refer to themselves as "publishers" of health information and not "data miners," maintained that information on who's prescribing what drugs to whom is speech that is protected by the First Amendment. The appeals-court's three-judge panel backed this argument.

Judge Debra Ann Livingston dissented from the majority opinion, however, maintaining that the Vermont law has "very limited, if any, effects on First Amendment activity."

The ruling was criticized by Vermont physicians, many of whom supported the 2007 law because it controlled use of the prescribing information collected by pharmacies.

"The medical community was very involved with the passage of this legislation," said David Fassler, M.D., APA treasurer and legislative representative of the Vermont Psychiatric Association (VPA), in comments to Psychiatric News. "The general sense was that data regarding prescriptions written by individual physicians should not be aggregated, sold, and used for marketing purposes."

Although the VPA has not taken a formal position on the law, Jonathan Weker, M.D., the VPA representative to the Vermont Medical Society (VMS), told Psychiatric News that many—but not all—Vermont psychiatrists oppose such data collection over concerns that it could violate their privacy and that of their patients. "As an individual physician, I was astounded to discover that all of the data on my prescribing patterns were being collected and disseminated without my knowledge," Weker said.

That information includes the name and address of the prescribing physician, the quantity of the medication prescribed, where the prescription was filled, and the patient's age and gender.

"The doctor-patient relationship requires privacy to work effectively," emphasized Madeleine Mongan, deputy executive vice president of the VMS, in comments to Psychiatric News. The VMS was one of the leading supporters of the measure as it moved through the state legislature, but it does not plan any action in response to the recent court decision, according to Mongan.

The "VMS believes that the use of physician-prescription information by drug sales representatives is an intrusion into the way physicians practice medicine."

Ultimately, the Supreme Court is expected to decide the fate of the Vermont law, according to physician advocates like Mongan, because the November appeals court ruling appears to conflict with earlier rulings by the First Circuit Court of Appeals—in November 2008 and August 2010—that upheld similar laws in New Hampshire and Maine, respectively, limiting use of prescriber information by marketing firms (Psychiatric News, September 3, 2010). The U.S. Supreme Court declined last year to review the decision in the New Hampshire case, but as of early last month, it had not been asked to review the appeals court decision regarding the Maine law (Psychiatric News, August 7, 2009).

Mongan said that the Vermont attorney general's office has already decided to appeal the ruling on that state's law.

Although the two federal appeals courts applied varying constitutional standards to arrive at their decisions on the data-mining laws, it may be significant that the Vermont law is most similar to the Maine law, Mongan said. That law also requires physicians to "opt in" before their prescribing data may be mined, while the New Hampshire law—which the Supreme Court left standing—is an outright ban on data mining.

Vermont, Maine, and New Hampshire are the only states to enact restrictions on marketers' use of physician prescribing information.

The appellate court's decision in IMS Health Inc., et al., v. William Sorrel, et al., is posted at <www.imshealth.com/deployedfiles/imshealth/Global/Content/StaticFile/Legislative%20Content/IMS_v_Sorrell_Vermont_Second_Circuit_Slip_Opinion.pdf>.blacksquare

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