Glaxo to stop paying doctors to pump its drugs

British drug company GlaxoSmithKline said Tuesday it is to scrap individual sales targets, just months after being embroiled in a bribery scandal allegedly conducted by some of its employees in China.

The pharmaceutical group also said it would stop paying doctors to promote its products at speaking engagements and providing direct financial support to health care professionals to attend medical conferences. However, it left open the possibility of funding through grants.

"It is patients' interests that always come first," Andrew Witty, the company's chief executive, insisted. "We recognize that we have an important role to play in providing doctors with information about our medicines, but this must be done clearly, transparently and without any perception of conflict of interest."

Chinese scandal

The changes come as GlaxoSmithKline PLC distances itself from the scandal engulfing its operations in China, which Witty has said was conducted by people "acting outside of our processes." In July, he insisted that "99.9 per cent" of company employees play by the rules.

Chinese police allege that four employees paid bribes to doctors to encourage them to prescribe medications.

The company says that under its new program, individual sales targets will be replaced by a new system in which GSK employees will be rewarded for their technical knowledge, their quality of service and overall performance. The goal is for the new system to be in place by early 2015.

It added that these changes were influenced by a similar program introduced in the United States in 2011.

"The 'Patient First' program bases compensation for sales professionals who work directly with prescribing health care professionals on a blend of qualitative measures and the overall performance of their business, rather than the number of prescriptions generated," the company said.

The company has also faced issues in the United States. It has paid $3 billion and pleaded guilty to promoting two drugs for unapproved uses and failing to disclose important safety information on a third. The criminal case was accompanied by a civil settlement in which the government said the company's improper marketing included providing doctors with European hunting trips, high-paid speaking tours and even tickets to a Madonna concert.

At the time, the company said it had learned from its mistakes.

Health care advocates welcomed the change in GSK's position, but some, like Tim Reed of Health Action International, said self-regulation remains a big problem in the industry.

"It is like marking your own homework," said Reed, who favours strong state regulation.

New policies

Though he did not expect huge changes, Reed said Glaxo's decision may reflect a change of thinking in the industry away from targeting doctors and toward those who pay the bills, like agencies that make recommendations on which drugs to buy.

"It is possible that the role of health care professionals, responsible for writing prescriptions for medicines are becoming of less value to the pharmaceutical industry, in terms of the promotion of products," he said.

"Rather, it may be those with the ultimate responsibility for paying the bill for medicines, for example insurance companies and governments, so the focus of attention for sales reps may well switch to those making the therapeutic and cost-effectiveness decisions on medicines availability," he added.