[Congressional Record Volume 155, Number 13 (Thursday, January 22, 2009)]
[Senate]
[Pages S787-S789]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. GRASSLEY (for himself, Mr. Kohl, and Ms. Klobuchar):
  S. 301. A bill to amend title XI of the Social Security Act to 
provide for transparency in the relationship between physicians and 
manufacturers of drugs, devices, biologicals, or medical supplies for 
which payment is made under Medicare, Medicaid, or SCHIP; to the 
Committee on Finance.
  Mr. GRASSLEY. Mr. President, I rise to introduce a bill today. Over 
the past several years, I have worked to establish greater transparency 
in the financial relationships and financial disclosure requirements 
between physicians and manufacturers of drugs, of biologics, and 
medical devices.
  In the last Congress, the 110th, Senator Herb Kohl of Wisconsin and I 
introduced what is entitled the Physician Payments Sunshine Act, which 
is intended to bring some much-needed transparency to these 
relationships between physicians and manufacturers.
  To explain why this bill is so important, let me point to a number of 
investigations I have conducted in the depth and scope of these 
relationships between physicians on the one hand, and manufacturers of 
drugs, biologics, and medical devices on the other hand.
  My findings to date are troubling and reveal significant undisclosed 
financial ties between physicians and industry. Some examples: These 
relationships, at times, resulted in annual incomes of over $1 million 
to individual physicians from just one company.

[[Page S788]]

  Another example. My investigations determined that several prominent 
physicians at major universities had failed to disclose large sums of 
money to their research institutions. That was despite institutional as 
well as Federal requirements that these reportings take place.
  This was also despite these physicians' involvement with Federal 
research study products made by the various drugmakers with whom they 
have financial relationships.
  This Federal research has involved billions of dollars in taxpayers' 
money to fund this research.
  My oversight has confirmed the need for a consistent, easy-to-
understand national system of disclosure, as opposed to a patchwork of 
disclosure requirements at State and institutional levels, although I 
compliment States that have such laws on the books.
  Today I am here to introduce, along with Senator Kohl, the Physician 
Payment Sunshine Act of 2009. The Physician Payment Sunshine Act would 
require that manufacturers of drugs, biologics, and medical devices 
disclose, on an annual basis, any financial relationships that they 
have with physicians. That information would be posted online by the 
Secretary of Health and Human Services in a format that is searchable, 
that would be clear and easy for the public to understand.
  Whether the relationship is as simple as buying a doctor's dinner or 
as complex as a multimillion-dollar consulting arrangement, these 
relationships may affect prescribing practices and may influence 
research.
  More importantly, they can obscure the most important issue existing 
between doctors and patients, and that is a question every doctor and 
patient has to consider: What is best for the patient?
  This legislation Senator Kohl and I are introducing today closely 
parallels the version I circulated last year and follows some recent 
MedPAC recommendations.
  MedPAC recommended a lower annual reporting threshold of $100--in the 
previous bill, it was higher--no de minimis exceptions for payments and 
a tighter preemption provision.
  MedPAC will publish their final recommendations in their March report 
to Congress. I will take those recommendations into consideration and 
intend to continue pursuing policies that go beyond the transparency in 
health care than even the existing bill does.
  There is a greater need for this legislation, and that greater need 
is demonstrated by a witness testifying at the Finance Committee 
hearing on health reform last year that industry and physician 
relationships are pervasive.
  Drug and device companies spend billions and billions every year on 
marketing, product development, and research, and much of this money 
goes directly to doctors.
  Last year, the Des Moines Register wrote:

       Your doctor's hand may be in the till of a drug company. So 
     how can you know whether the prescription he or she writes is 
     in your interest or the best interest of a drug company?

  That is a pretty good question that we all ought to be looking at.
  Many of these relationships are beneficial and appropriate. That is 
why we don't outlaw any of these relationships. What we do is make them 
be reported. And some of these should be reported on a more regular 
basis than they are even without this legislation.
  Physicians play important roles in inventing and refining new devices 
or in conducting medical research. They are hired to educate other 
doctors. We don't do anything in this legislation to end those 
professional relationships.
  But as is often the case, a few bad apples can spoil the whole 
barrel. It is clear Congress needs to act now to pass disclosure 
legislation.
  Currently, drug and device makers have to comply with a number of 
State requirements, each State giving its own definition and own rules.
  Patients as well as other doctors have no way to learn about these 
important relationships. This information should not only be available 
to those few Americans lucky enough to live in a State already 
requiring some level of disclosure.
  Even in the States currently requiring disclosure, most do not apply 
that law to medical device companies. Some States do not even make 
public the information they collect, which is of little value to 
patients who might want to know if their doctors have a relationship 
with a drug company or a medical device company about which they ought 
to know.
  Now, this bill isn't adding new burdens to the industry. By creating 
a central reporting system, the legislation actually relieves burdens. 
In addition, I am hopeful that this bill will enjoy the same wide-
ranging support as the prior legislation that Senator Kohl and I put in 
during the 110th Congress.
  I want to be clear--and this is the second time I am being clear on 
this point--this legislation does not regulate the business of drug and 
device companies. Let the people in industry do their business since 
they have the training and the skills to get the job done. But keep the 
American people apprised of the business you are doing and how you are 
doing it. After all, what is at risk isn't merely private interest but 
the health and well-being of all Americans who depend upon the drugs 
and medical devices to sustain and to improve their lives.
  In this process of what we call transparency, in this process that we 
call sunshine legislation, I often quote from an opinion of Justice 
Brandeis, I think in 1914, where he said: ``Sunlight is the best 
disinfectant.'' And that is what Senator Kohl and I are aiming to 
accomplish with this Physician Payment Sunshine Act, just a little 
sunlight so the public is better informed.
  Mr. KOHL. Mr. President, I rise today to reintroduce the Physician 
Payments Sunshine Act, along with my colleague Senator Grassley. This 
legislation will be a great step forward in increasing transparency of 
the relationships between pharmaceutical and medical device companies 
and our Nation's physicians, for the benefit of their patients.
  I want to begin by underscoring the fact that industry payments to 
physicians for research purposes or products they have helped develop 
are completely legitimate. Medical breakthroughs as a result of 
research have saved countless lives and could not have been achieved 
without the diligence of these me cal professionals. We must 
acknowledge, however, that conflicts of interest do exist in some 
cases. Transparency will help to illuminate the difference between 
legitimate and questionable relationships.
  It has been estimated that the drug industry spends $19 billion 
annually on marketing to physicians in the form of gifts, lunches, drug 
samples and sponsorship of education programs. Americans pay the price 
as through unnecessarily high drug costs and skyrocketing health 
insurance premiums. Rising drug prices hurt us all by undermining our 
private and public health systems, including Medicare and Medicaid.
  Even more alarming is the notion that these gifts and payments can 
compromise physicians' medical judgment by putting their financial 
interest ahead of the welfare of their patients. Recent studies show 
that the more doctors interact with drug marketers, the more likely 
doctors are to prescribe the expensive new drug that is being marketed 
to them.
  As a businessman, I understand that companies have the right to spend 
as much as they choose to promote their products. But as the largest 
payer of prescription drug costs, the Federal Government has an 
obligation to examine and take action when companies attempt to 
manipulate the market.
  I believe the Physician Payments Sunshine Act presents a long overdue 
solution to combat this potentially harmful influence. The legislation 
would require manufacturers of pharmaceutical drugs, devices and 
biologics to disclose the amount of money they give to doctors through 
payments, gifts, honoraria, travel and other means. These disclosures 
would be registered in a national, publicly accessible online database, 
managed by the U.S. Department of Health and Human Services. Those 
companies who fail to report will be subject to financial penalty.
  In the year and a half since the Sunshine bill was first introduced, 
several States have passed their own laws forcing disclosure, and 
several leading pharmaceutical companies have voluntarily implemented 
disclosure guidelines. A comprehensive national bill would create a 
one-stop information

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vault, here patients could easily gain access to data about these 
relationships. It is my hope that this online database will encourage 
patients to discuss any concerns they may have with their doctors.
  A great deal of money changes hands in the health care field, and a 
good percentage of it is helping Americans live healthier lives. The 
Physician Payments Sunshine Act will provide the transparency necessary 
to raise that percentage. We deserve nothing less.
                                 ______