Medtronic Inc., Medical Device Maker Once Accused of Paying Illegal Kickbacks, Agrees to Show How Much it Pays Physicians

Medtronic Inc., a leading maker of heart defibrillators and other medical devices, says it will start keeping track of how much money and other perks it gives to physicians for consulting and other work then make the numbers public.

The company is the largest medical-device maker and the latest in a string of medical-industry giants to announce so-called “transparency” measures, billed as efforts to throw open the doors to corporate boardrooms and show the public which doctors are on drug company payrolls and for how much.

The Minneapolis-based manufacturer said it will begin tracking all payments to doctors in excess of $5,000 in January 2010 and expects to release its first public report on the funding in March 2010.

Such moves should be applauded, but also closely monitored to ensure their accuracy and completeness. Only when drug consumers and physicians have all the facts, or at least more facts, can they make more informed, unbiased decisions about which drugs and medical devices are best.

Another Corporation Agrees to Open Its Books

Recently, some big-name drug companies – including Pfizer, Merck & Co., Eli Lilly & Co., and GlaxoSmithKline – have unveiled similar plans for public disclosures of doctor funding. Most of the companies have said they will begin releasing data on payments and perks provided to physicians and other company outsiders in 2010.

Just over two years ago, Medtronic paid $40 million to settle allegations it paid illegal kickbacks to doctors who used its products. The company admitted no wrongdoing in ending charges that it showered lavish luxury trips and maintained fraudulent consulting deals with doctors who used Medtronic devices. The U.S. Justice Department had been investigating Medtronic’s practices for years before the agreement was reached.

Support for Federal Legislation Builds

Support also is growing in Washington, D.C. for pending federal legislation which would require drug-industry firms to annually report to the U.S. Department of Health and Human Services all payments to physicians over $100. Failing to do so would violate the law and incur fines of up to $1 million.

One bill, the Physician Payments Sunshine Act of 2009 sponsored by Sen. Charles Grassley (R-Iowa) and Sen. Herb Kohl (D.-Wis.), is expected to be reintroduced soon after failing to garner enough support to be passed into law in 2007.

Despite the voluntary efforts by Medtronic and other drug-industry firms to offer to open their own books to the public, legislation to hold their feet to the fire on the issue is necessary. Grassley’s bill and other similar legislation should be passed into law in the best interests of millions of American medical consumers.

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