Legal Briefing: Will Drugmakers' Prescription Data Mining Be Undermined?

A daily look at legal news and the business of law:

Prescription Data-Mining Case Goes to the First Circuit

One of drug marketers' key tools in targeting physicians for increased sales is doctors' prescribing history. Using that data, marketers can see who's prescribing the competition's products and tailor pitches to convert them; who isn't prescribing much of anything and try to change that; and who are big prescribers and reward them, cultivating even more business.

Research has shown that drug marketers are successful at influencing physicians' prescribing habits, for example, inducing prescriptions for expensive brand-name drugs when effective generics are available. As a result, some states are trying to curb marketers' effectiveness, including limiting access to physician prescribing history.

The First Circuit has already upheld one such law, from New Hampshire, and now is set to hear a case involving a similar law from Maine. If such laws are routinely upheld and spread across the land, drugmakers could see profits take a hit.

Two More Convictions From Massive Medicare Fraud Bust

Last June, the Justice Dept. indicted 53 medical providers in the Detroit area for defrauding the government out of $50 million in false Medicare billings and has been methodically convicting them. Yesterday, two more defendants, a doctor and a patient recruiter, were convicted for billing nearly $1 million in false claims in just four months.

The clinic was designed to defraud from the outset. Its owners moved from Miami, where such schemes were difficult to perpetrate because of intensive enforcement, to Detroit to set up shop. Then the clinic got patients by paying them kickbacks, while giving them no treatment or treatment that was medically unnecessary or even potentially harmful.

The Detroit enforcement effort was phase three of a (so far) seven-phase effort launched in March, 2007. Total indictments to date cover $1 billion in fraudulent charges.

Whistleblower News

Earlier this week, a jury ordered Pfizer (PFE) to pay $1.4 million to a former employee, molecular biologist Becky McClain, who claimed she was sickened by a virus engineered at the plant she worked in -- and then fired for raising concerns about safety at the location, reports The New York Times. While the trial didn't address McClain's claims of exposure to the virus or that her illness resulted from it, the jury found Pfizer illegally retaliated against her. The drugmaker denies the claim, saying McClain was fired for refusing to return to work for 11 months and is considering appealing.

BB&T (BBT) also just lost a whistleblower case, reports The New York Times. Amy Stroupe was fired after she exposed a $100 million development scam -- a ponzi scheme -- in North Carolina that the company was helping to finance. Now BB&T must hire her back.

Speaking of Ponzi Schemes...

Victims of R. Allen Stanford's $7 billion fraud picked up a few more crumbs of restitution -- $14.2 million -- when authorities completed the sale of his Panamanian assets, reports Bloomberg.