Phil Marino for The New York Times
A lunch order arrives at North Shore Diabetes in New Hyde Park, N.Y. A pharmaceutical company paid for the food.
July 28, 2006
Drug Makers Pay for Lunch as They Pitch
By STEPHANIE SAUL
Anyone who thinks there is no such thing as a free lunch has never visited 3003 New Hyde Park Road, a four-story medical building on Long Island, where they are delivered almost every day.
On a recent Tuesday, they began arriving around noon. Steaming containers of Chinese food were destined for the 20 or so doctors and employees of Nassau Queens Pulmonary Associates. The drug maker Merck paid the $258 bill.
A deliveryman carrying trays of gourmet sandwiches sashayed past patients at Advanced Internal Medicine. The bill showed that Takeda Pharmaceuticals was picking up the bill. The doctors in the group must have liked the sandwiches. The next day, the exact same delivery came in, paid for by Cephalon.
Free lunches like those at the medical building in New Hyde Park, N.Y., occur regularly at doctors’ offices nationwide, where delivery people arrive with lunch for the whole office, ordered and paid for by drug makers to the tune of hundreds of millions of dollars a year.
Like the “free” vacation that comes with a time-share pitch attached, the lunches go down along with a pitch from pharmaceutical representatives hoping to bolster prescription sales. The cost of the lunches is ultimately factored in to drug company marketing expenses, working its way into the price of prescription drugs.
Doing business over lunch is a common practice in many fields, but drug makers have honed it to perfection, particularly since 2002, when the drug industry adopted a new code banning many other free enticements — golf outings, athletic tickets, trips and lavish dinners for doctors. The code gives approval to modest meals in the course of business. And conventional wisdom in both the pharmaceutical industry and the medical profession is that a lunch is too small to pose an ethical problem. But a growing number of critics say that even those small lunches should be banned.
A former pharmaceutical representative, Kathleen Slattery-Moschkau, called lunch “incredibly effective” in lifting pharmaceutical sales for the companies where she worked, Bristol-Myers Squibb and Johnson & Johnson.
“We got the numbers of what the physicians were prescribing. If I brought in lunch one week, I could see the following week if that lunch had an impact,” Ms. Slattery-Moschkau said.
Dr. John G. Scott, assistant professor of family medicine at the University of Medicine and Dentistry of New Jersey-Robert Wood Johnson Medical School in New Brunswick, N.J., is examining the interaction between medical practices and pharmaceutical representatives.
“We found that some offices get breakfast and lunch every day,” said Dr. Scott, who calls lunch the “currency” that buys access to doctors’ offices for drug representatives. He also noted that some doctors were hard pressed to meet payrolls and that the lunches provided an added benefit for their employees.
“Essentially, we feel that most of what the pharmaceutical reps do works at an unconscious level,” Dr. Scott said. He said most doctors said they were not influenced by the food deliveries and other small gifts. But, he added, “They do influence prescribing.”
The $258 Merck lunch, for example, cost the company only $10.75 a person and fell clearly within industry guidelines allowing modest meals. But it could easily return thousands of dollars for the drug maker in prescriptions for the osteoporosis medication Fosamax and the asthma treatment Singulair, the two drugs discussed during lunch with two Merck representatives.
An official of Merck’s sales and marketing division, Patrick T. Davish, says his company views lunch meetings as appropriate and “a good time to sit around and talk about the clinical properties of your drug and the disease categories you deal with.” Spokesmen for both Takeda and Cephalon emphasize that the lunches they pay for are modest.
Dr. Scott cited several studies that show that the lunches — plus small gifts like pens and sticky notepads, along with drug samples — can lead doctors to prescribe the more expensive brand names when cheaper generic drugs would be as effective.
Such concerns have spurred the effort to ban lunches. The movement is making headway nationwide, as opponents of the practice cite ethics questions. The hospital at the University of Pennsylvania became the latest large institution barring industry-paid lunches, effective July 1, according to its medical director, Dr. Patrick J. Brennan.
“It curries favor and it creates influence, and it introduces influences into decision-making processes that we think ought not to be there,” Dr. Brennan said.
Similar rules have been adopted recently at several other academic medical centers. When the University of Michigan Health System banned industry lunches last year, officials calculated that they had been worth $2.5 million annually.
In Madras, Ore., meanwhile, a group of internists earlier this year banned not only lunch but also visits by drug representatives. Even in Madras, a rural town of about 5,000, the group got visits from more than 30 drug representatives a month, including two or three lunches.
“The complaints that I would get from my patients were, ‘You’re 15 minutes late to see me.’ ” said Dr. David V. Evans, a member of the group. “ ‘O.K., I was back there talking to a drug rep.’ That wasn’t such a good thing.”
Dr. Evans added, “It’s an issue of professionalism and integrity, really.”
The pharmaceutical industry employs about 90,000 representatives. While some patients grumble about their ubiquitous presence in medical office waiting rooms — and many are aware of lunch deliveries — others say the intrusion is worthwhile in exchange for the free drug samples.
“The doctors I go to only see them at certain times,” said Arnold Dimond of Glen Oaks, N.Y., who was leaving the New Hyde Park building recently, carrying a plastic bag of drug samples. “The samples save you quite a bit of money, too.”
One of the most vocal opponents of free lunch is Dr. Bob Goodman, a Manhattan internist who formed an organization called No Free Lunch.
“I’d say that lunches are going to be one of the last things to go,” Dr. Goodman said. “The interesting thing is that it’s generally not something doctors are ashamed about. That’s why I find this thing so fascinating. They don’t think they’re doing anything wrong.”
At 3003 New Hyde Park Road most of the doctors contacted declined to be interviewed for this article. But one, Dr. Javier Morales, said the samples that representatives bring to his office are helpful for low-income patients.
And Scott M. Lassman, senior assistant general counsel for the Pharmaceutical Research and Manufacturers of America, said: “It’s our feeling that a modest meal is not the type of thing that is going to interfere with the independence of a health care practitioner. It’s really a recognition that these folks are extremely busy. They don’t have time to talk. Perhaps the only time they do have time to talk is over lunch or dinner. So we thought it was appropriate for the sales rep to pay for that.”
Not every doctor’s office gets free lunches at 3003 New Hyde Park Road, though many do. The deliveries often start even before lunchtime, with representatives bringing in pastries and large containers of coffee from Starbucks or Dunkin’ Donuts.
Ms. Slattery-Moschkau, the former pharmaceutical representative, said that nurses and staff members in some offices were quite demanding about lunch.
“It was almost a game, and it was unbelievable the animosity they would show if you did not bring the right kind of food, or if it was the third time they had pizza that week,” said Ms. Slattery-Moschkau, who left the industry in 2002 and recently wrote and directed the documentary “Money Talks,” in which the practice of lunch is discussed.
Midweek lunches, when all the doctors are sure to be in the office, are considered prime time.
“Wednesdays are big,” said Larry Plompen of West Islip, N.Y., who peddles lunch and coffee out of a refrigerated truck at 3003 New Hyde Park Road. Several years ago, Mr. Plompen said, a drug company purchased lunch from his truck for the entire staff of a large practice in the building.
Other entrepreneurs have also capitalized on the business — a segment of the restaurant industry that one national lunch-ordering company, Lunch and Earn, estimates is worth $4 million a day, or as much as $1 billion a year. A founder of that company, Amy Kristjanson, a former pharmaceutical representative, said her numbers were based on a calculation of lunch spending by representatives for the top 10 pharmaceutical companies.
Mr. Lassman said he was not aware of any industrywide figure for the cost of such lunches. But various sales representatives, pharmaceutical companies and the lunch delivery industry supplied estimates of how much is spent for lunch. Judy Kay Moore, spokeswoman for Eli Lilly, for instance, said that company’s representatives spend $500 to $750 a month for lunches. Joseph R. Carolan, an owner of Casa Mia’s in Nottingham, Md., which does a large pharmaceutical lunch delivery business in the Baltimore area, said the average representative he deals with has a monthly lunch budget of close to $2,000.
Mr. Carolan said his lunch business — about 30 to 40 orders a day — exploded after the new industry marketing code was adopted in 2002.
“I got into this because the feds cracked down on the more extravagant things they were doing: the dinners, courtside N.B.A. games, flying them to the islands.” Mr. Carolan said.
He is also on the forefront of another marketing trend: rewards programs for pharmaceutical representatives.
One who spends $5,000 at Casa Mia’s, for example, can get a $100 gift certificate to Nordstrom, one month of tanning, or a Swedish massage with a manicure and pedicure.
Ms. Kristjanson, the former representative who founded Lunch and Earn, said that lunch represented a fundamental shift in the business.
“Reps used to have more freedom,” Ms. Kristjanson said. “Lunch is sort of what it’s come down to.”
Copyright 2006 The New York Times Company
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