NH data case has implications for DTC foes

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A federal judge’s rationale for overturning New Hampshire’s ban on the commercial use of physician data parallels industry arguments against restrictions on other forms of marketing.

US district judge Paul Barbadoro agreed with the arguments of IMS Health and Verispan, which sued to block the law, dubbed the Prescription Privacy Protection Act. The law, which took effect last August, was aimed at keeping prescription data out of the hands of pharma manufacturers and crippling their detailing efforts.  

Summarizing his 54-page decision, Barbadoro said: “Because the Prescription Information Law restricts constitutionally protected speech without directly serving the state’s substantial interests and because alternatives exist that would achieve the state’s interests as well or better without restricting speech, the law cannot be enforced to the extent that it purports to restrict the transfer or use of prescriber-identifiable data.”

Barbadoro based his decision largely on a 1980 Supreme Court decision, Central Hudson Gas & Electric Corp. v. Public Service Commission. Central Hudson Gas & Electric Corp. had sued over a law banning advertising by electric utilities. The court found the law violated the First and Fourteenth Amendments.

In his decision, Barbadoro noted, the court said truthful commercial speech that does not promote unlawful activity can be limited only if it “is in support of a substantial government interest,” “directly advances the government interest asserted” and “is not more extensive than is necessary to serve that interest.” For example, Barbadoro said, the state could have: sought to limit samples, gifts, meals and other inducements to docs; offered best practice guidelines on both the health and cost implications of their prescribing decisions; developed “counter-detailing” programs emphasizing drug costs; required physicians to take CME courses comparing generics with prescription drugs; or implemented a Medicaid Pharmacy Program to encourage use of generics.

Richard Samp, counsel at the Washington Legal Foundation, called Barbadoro’s decision “tremendous.”

“The judge said exactly what we’ve been saying all along,” said Samp, “that under the First Amendment, if the government wants to achieve some important regulatory objective, restrictions on commercial speech must be the last methods resorted to after all other nonspeech alternatives have failed—not the first. Any effort to impose a ban on DTC advertising is sure to be struck down for precisely this reason.”

If the precedent holds, it could deter politicians from trying to impose limits on advertising and other forms of promotion—or at least provide assurance that any ill-conceived laws would quickly be thrown out on First Amendment grounds.

But it’s not over yet. The state’s attorney general, Kelly Ayotte, has vowed to appeal the decision, saying the law protects the state’s interests and the interests of New Hampshire’s physicians and citizens, which strongly outweigh the pharmaceutical industry’s interest in increased profits.”
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