Pharmaceutical Companies Shell Out For Doctor's Prescribing Data
It is no secret that pharmaceutical firms spend endless amounts of money to get prescribing data from physicians. IMS Health Holdings Inc, the leading pharma data company, released a new document detailing just how much they spend.
IMS reports it made close to $2 billion in the first three quarters of 2013 as a result of collecting data from pharmacies and selling it to its pharmaceutical and biotech clients. In 2012, IMS had total revenues of $2.4 billion from the collection and sale of the same information.
These figures have been made public for the first time because privately owned IMS has filed its intent to make an initial public offering (IPO) of its stock. These numbers give insight into a little known and lightly regulated industry.
IMS is a company known as a prescription drug information intermediary. Their product, data, is used by pharmaceutical sales representatives for insight into their specific customers’ prescribing habits. The industry is controversial, with some doctors and patient groups saying it threatens the privacy of private medical information.
The data gathered and maintained by IMS and other industry firms is immense. IMS claims it has data that covers “over 85 percent of the world’s prescriptions by sales revenue,” in addition to de-identified, or anonymous medical records for 400 million individuals. The company reports in its prospectus that all of the top one hundred global biotechnology and pharmaceutical companies are among their clients.
In recent years, IMS has grown through acquisitions, swallowing up smaller competitors in the same space. The expansion in the area of patient records has been particularly strong, making their information more valuable to clients as they match anonymous records and diagnoses with prescriptions and prescribing behavior.
IMS and other similar data companies have been sued over privacy issues, but won when the U.S. Supreme Court ruled that the right to collect and sell information is protected under the First Amendment.
IMS Health did not comment on this story due to the regulatory quiet period required before the IPO.