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Pharma Companies Can Buy Prescription Data: S.Ct. Rules

By Cynthia Hsu, Esq. on June 28, 2011 | Last updated on March 21, 2019

The Supreme Court's prescription data decision in Sorrell v. IMS Health Inc. has invalidated Vermont's prescription data-mining law in a 6-3 decision.

The data-mining law, officially called Vermont's Prescription Confidentiality Law, made it so that without the patient's consent, doctors and other healthcare providers could not sell or give their information to pharmaceutical companies and other entities, according to the Court's opinion.

The data in question is prescription records that data collectors or data miners buy from pharmacists or other healthcare providers. They then re-sell the information to drug manufacturers.

The information in question does not include personal identifying information like names. But, it does include data that prescription drug companies use to market their products, like the physician's name, address, and the strength of drugs that are prescribed. Essentially, the data allows pharmaceutical companies to analyze what drugs are being prescribed and by who, and at what frequency, according to USA Today.

Vermont's anti-prescription data-mining law was meant to stop doctors from harassing marketing campaigns from prescription drug manufacturers, and as a way to suppress health care costs, according to the state legislature.

The Supreme Court, however, decided that the law was a violation of free speech. The statute in question was essentially a content and speaker-based restriction on sale and disclosure of information. The Court noted that while the law specifically forbade drug data miners from getting the information, it was still perfectly legal for others to get the same information.

As a result, the Court analyzed the statute under a heightened judicial scrutiny standard: the law must have been a statute that directly advances a substantial governmental interest, and the law must have been enacted and created to achieve that interest, according to the majority opinion.

The law did not pass under this heightened scrutiny standard, and it was found to be violating the companies' freedom of speech. The Court acknowledged Vermont's governmental interest in safeguarding patient information and keeping health care costs low, but due to the widespread availability of the drug information despite the anti-data mining ban, the Court acknowledged that Vermont could not justify the burden they had placed on speech.

The Supreme Court's prescription data case, while centered on a Vermont law, was defended by 35 other states as well as the Justice Department. The anti-prescription data mining law, enacted in 2007, is similar to other laws passed in Maine and New Hampshire, according to USA Today.

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