MINNEAPOLIS, January 25, 2008—Pharmaceutical companies are crying foul about incentives being paid by some health plans to physicians to switch patients to generic drugs, according to a Wall Street Journal story

Some health plans are paying doctors $100 each time they switch a patient from a brand-name drug to a generic.

Pharmaceutical companies have spent hundreds of millions to get doctors to prescribe their brand-name medicines, the story said. But as the patents for top-selling medicines expire, some health insurers are offering bonuses or higher reimbursements for writing more generic prescriptions.

The idea, health plans say, is to save patients, employers and insurers money. And doctors say it's only fair to reimburse them for spending time deciding whether a generic is as good as a name-brand drug.

But pharmaceutical companies don't like offering cash incentives to undercut their marketing efforts, in what they say should be a medical, and not a financially-influenced opinion.

The incentive program that has drawn the most scrutiny is one initiated last year by Blue Care Network, a health-maintenance organization owned by Blue Cross Blue Shield of Michigan. Under the three-month program, primary-care physicians were asked to consider switching patients from a brand-name drug and received $100 for each plan member who filled a generic cholesterol-lowering statin prescription.

To assist doctors, the HMO mailed them a list of network patients who were taking Lipitor and Lescol.

Blue Cross Blue Shield of Michigan says the $2 million it spent on payments to doctors saved the network $5 million in drug costs and its individual members $1 million in co-payments.

In Michigan, a state Senate committee planned a hearing last fall on the incentives before being sidetracked by the state's budget crisis. Halfway across the country, reports of the Michigan program prompted legislation in Massachusetts to keep it from spreading.

The American Medical Association says doctors and medical societies have contacted them to learn whether the incentives exposed them ethically or legally.

The AMA's response: "Accepting payment for moving a patient from a brand name to a generic could be viewed as an antikickback statute violation."

Several medical associations say that Pfizer Inc., the maker of Lipitor, contacted them to drum up awareness about the incentive program. Pfizer confirms that it has pointed out to some medical societies the potential clinical and policy implications of those programs.

Complete Wall Street Journal article