MELISSA BLOCK, HOST:
Today, one of the biggest drug companies in the world announced changes to its marketing practices. GlaxoSmithKline says the idea is to be more transparent about how it sells its drugs. Among the changes, the company will stop paying doctors to tout its products to other doctors.
As NPR's Yuki Noguchi reports, the public interest community says this is a step in the right direction for an industry that's faced many legal problems.
YUKI NOGUCHI, BYLINE: Jerry Avorn is a professor at Harvard Medical School who writes about the medical community's conflict of interest problems, which, he makes clear, is not something he gets sponsored to discuss.
JERRY AVORN: I don't get paid anything for any of this, so there's no conflict of interest on my end.
NOGUCHI: But plenty of doctors attend lectures that Avorn calls gourmet infomercials. Doctors get paid to speak to their peers and tout the merits of a new drug. And even with disclosures, the line between marketing and education gets blurred.
AVORN: So the disclosure is required but it's often not noticed by the doctors who are participating.
NOGUCHI: Avorn says there are consequences to this industry practice.
AVORN: It does drive up costs. It does influence prescribing. And also, if the advertising or lecturing is promoting a drug that has safety problems, that also exposes patients to risks because the old standby drugs are often neglected in favor the highly promoted drugs. And that can cause problems since the old standbys often have a better track record for safety and effectiveness than the new drugs that are being promoted.
NOGUCHI: The pharmaceutical industry and GlaxoSmithKline have run into many legal problems around their marketing practices in recent years. That is part of what is driving Glaxo's changes. The company said it will no longer sponsor doctors as speakers, which it still does in the U.S. It will also stop sponsoring doctors to attend conferences and will no longer compensate its sales representatives based on sales targets, practices it has stopped in America but which continue in other countries.
Glaxo is the first in the industry to implement such plans on a global basis. The company declined to be interviewed but said in a statement it is doing so to protect patients' safety and enhance transparency. The move met with some halfhearted applause from Sidney Wolfe, a long-time industry critic and a founder of advocacy group Public Citizen.
SIDNEY WOLFE: I do not deny it's a step forward.
NOGUCHI: But Wolfe notes, just last year, Glaxo paid $3 billion and pled guilty to illegal marketing and admitted it withheld safety data in a justice department case. And Wolfe says the company has paid a $1 billion more in penalties in the last decade involving other fraud charges.
WOLFE: If you look at what they have been caught doing in 2003, 2005, 2010, 2012, a number of the things that they were caught with are not part of their new set of promises.
NOGUCHI: Pratap Khedkar is a bit less harsh. He heads the pharmaceutical division of ZS Associates, a marketing consulting firm. He says Glaxo and the rest of the industry face a shifting regulatory and business environment. As a result...
PRATAP KHEDKAR: Pharma is gradually changing the way it does promotion.
NOGUCHI: He says the new health care law is also driving the change. Next year, the U.S. government will launch a public database detailing how much every doctor receives in compensation from drug companies.
KHEDKAR: I think some doctors may pull back because if they are perceived as getting too much money from the industry, they make get concerned about it and they may basically scale back their engagement.
NOGUCHI: Khedkar says new drug promotion is also less necessary because the industry is simply launching fewer drugs. And doctors can get more information on demand online, which is why he expects other companies to follow in Glaxo's footsteps. Glaxo says all the changes will be implemented in all the countries it operates in by early 2016. Yuki Noguchi, NPR News, Washington.
BLOCK: This is NPR News. Transcript provided by NPR, Copyright NPR.