GlaxoSmithKline loosens restrictions on doctor payments
Years ago, pharmaceutical giant GlaxoSmithKline (GSK) decided to stop offering “doctor payments”. Officially completing this structural change in 2016, it meant that the company ceased to offer $85 million in funding a year to doctors for clinical trials and speaking fees. The decision was taken in an effort to clean up the sector, as there were increasing worries that ‘Big Pharma’ was buying research and opinions – GSK wanted a more transparent, more trustworthy, healthcare market. However, that did not come to pass, and now the company says it’s putting fees back on the table.
GSK’s share price has risen by 13% so far this year
Source: Yahoo Finance
When GSK stopped making payments to doctors and researchers, it was expecting other big players to follow suit. That didn’t happen, and despite the reappearance of concerns over doctor payments, it doesn’t look like it’s going to happen any time soon. This potentially puts GSK at a disadvantage with “key opinion leaders and HCP influencers.” Nonetheless, its reversal of policy won’t be all encompassing. As a company spokesperson said: “the total payments under the new arrangements are expected to be significantly below pre-2013 levels.”
At time of writing, it is not entirely clear how doctor payments will be reintroduced – however, we do know that they will apply to GSK’s pharmaceuticals and vaccines businesses, in addition to ViiV Healthcare (its HIV-focussed joint venture with Pfizer and Shionogi). At present, GSK says that doctor payments will be limited to certain products, countries and time periods.
In announcing the changes, GSK wrote that the: “policy update is being made to ensure we continue to operate responsibly and improve how we help prescribers to understand new data and clinical experience with our innovative products, so they can deliver better outcomes for patients.”
Dominion holds GlaxoSmithKline in its Global Trends Managed Fund.
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