Supreme Court Strikes Data Mining Prohibition

In a victory for pharmaceutical and data-mining companies, the U.S. Supreme Court has struck down a Vermont statute that sought to outlaw the practice of pharmacies selling information to drug-makers about doctors’ prescribing habits.

In a 6-3 decision (PDF) Thursday, the high court ruled that Vermont’s law violated constitutional protections on free speech even though lawmakers drafted it with the goal of preventing pharmaceutical companies from using direct marketing to convince doctors to prescribe more-costly drugs to patients.

“While Vermont’s goals of lowering the costs of medical services and promoting public health may be proper, (the contested law) does not advance them in a permissible way,” Justice Anthony Kennedy wrote for the majority.

Across the country, pharmacies sell so-called prescriber-identifying information to drug companies, who then hire data-mining firms to scour the data for the names of physicians who should be targeted for direct sales pitches.

Vermont’s law sought to prohibit pharmacies from selling the information to drug companies for marketing purposes and to prevent data “detailers” from using the information to sell more drugs. However, the law continued to let healthcare researchers buy information for research purposes.

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