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Spending By Drug, Device, And Biologic Companies On The Rise

CONTACT: William H. Sorrell, Attorney General, (802) 828-3171

April 2, 2012

In the twelve months before July 1, 2011, 154 manufacturers of pharmaceuticals, biologics, and medical devices spent approximately $5.6 million in direct payments to Vermont doctors, hospitals, universities and others. That figure represents an overall spending increase of 17% from the $4.8 million reported the previous fiscal year. In particular, the amount spent on pharmaceutical marketing ($2.2 million) is about 22% higher than the $1.8 million reported in the previous fiscal year. “Vermonters have a right to know about the financial relationships between their doctors and drug companies,” said Attorney General William H. Sorrell. “The public can view the disclosure data that sheds light on those relationships on my office’s website.”

Vermont’s Prescribed Products Gift Ban and Disclosure law bans most gifts to Vermont health care providers and requires manufacturers of prescribed products - including pharmaceuticals, biological products and medical devices - to disclose expenditures deemed appropriate by the legislature. The report released Friday is based on disclosures for the fiscal year July 1, 2010, through June 30, 2011 (FY11). Starting in April, 2012, the law also requires manufacturers to disclose the distribution of free samples and of vouchers and co-pay cards that enable an individual to receive a prescription product for free or at a discount. A report on those expenditures will be published in the fall.

In FY11, approximately 42% of the $5.6 million in expenditures were for clinical trials and research. Doctors received 23% of the expenditures, 12% went to professional, educational, or patient organizations and 5% to academic institutions; 12% of the expenditures went to all health care providers combined for educational materials.

Of the 50 products with the greatest expenditures, drugs for treating Type 2 or Type 1 & 2 diabetes garnered the greatest amount of expenditures, as they had in FY10. Multiple sclerosis was the second highest indication. Expenditures for both indications were up significantly from last year.

Of the 50 products associated with over $28,000 in expenditures in FY11, 74% were pharmaceutical products, 24% were medical devices, and 2% were biologics. The ten products with the highest expenditures were all pharmaceutical products, and accounted for about one-third of overall spending.

For a copy of the report and the data upon which it is based, check the Attorney General’s website at: under “prescribed products.”

  Website consulting provided by The National Association of Attorneys General.