US proposes ban on drug firms' gifts to doctors

The Bush administration is to put a stop to the age-old drugs company practice of showering doctors with expensive gifts and treats.

Cruise holidays, golf equipment, concert tickets, lavish dinners and other "soft" sales techniques are all set for the chop as part of a sweeping series of proposals aimed at changing the entire system of drugs sales in the US.

Under the new laws, presents would be restricted in value to the equivalent of something like a branded ballpoint pen or stress ball.

Still in draft form, the proposals would outlaw many practices regarded until now as a sacred part of the pharmaceuticals marketing game. With competition between drugs companies fiercer than ever – and particularly with makers of generic drugs – these firms have long regarded their entertainment budgets as an essential weapon in the sales arsenal.

The new laws, if passed, would affect drugs companies around the world, for whom the US market has always been the most lucrative. Although companies such as GlaxoSmithKline, AstraZeneca and Merck remain coy about the true value of their "soft" marketing budgets, it is already clear to analysts that the laws would have a big impact on business practices and market share.

One Wall Street drugs analyst said: "These companies are just going to have to learn to sell the drugs on their own merits. A lot of them will not like that at all."

The proposals do not stop with gifts. The draft document from the Office of the Inspector identifies a range of other "suspect" activities in line for outlaw status. These include drugs companies paying doctors to act as consultants or researchers in marketing drives, paying doctors to switch patients from one drug to another, and providing scholarships and research grants.

The proposals are part of the US government's general overhaul of the pharmaceutical industry – a year-long probe that has already exposed many serious abuses and underlying weaknesses in the current system. Among the most serious involve situations where doctors are given free samples of drugs by the pharmaceutical companies in exchange for prescribing that treatment to their patients. Some doctors have faced prosecution for then charging the Medicare system or health insurance companies for those free samples. The annual value of such fraud is estimated at more than $1bn (£650m).