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The U.S. Supreme Court heard arguments today in a case testing the limits of data mining. At issue is whether states can bar the buying, selling and profiling of doctors' prescription records without a doctor's consent.

NPR legal affairs correspondent Nina Totenberg reports.

NINA TOTENBERG: Government regulations require pharmacies to keep records of all doctors' prescriptions. And in most states, pharmacies can and do sell these records to data mining companies - companies that in turn sell the information to drug makers for use in targeted sales pitches to doctors.

When doctors in Vermont found out their prescription records were being sold this way, they went to the state legislature and the state enacted a law barring the practice. The data miners and pharmaceutical companies contend the law is unconstitutional.

On the steps of the Supreme Court today, PhRMA general counsel Diane Bieri said it discriminates against the speech of drug makers, while allowing insurers and the state to push lower-cost generics.

Ms. DIANE BIERI (General Counsel, Pharmaceutical Research and Manufacturers of America): The statute is designed to make it more difficult for the pharmaceutical companies to identify doctors who will be most interested in learning about the medicines that they market.

TOTENBERG: But Vermont assistant attorney general Bridget Asay replied that nothing in the law prevents drug reps from talking to doctors.

Ms. BRIDGET ASAY (Assistant Attorney General, Vermont): All of the control is left with the doctor. The doctor gets to decide whether or not his private information about his or her prescribing practices is used for marketing. And that should be permissible under the First Amendment.

TOTENBERG: Inside the Supreme Court chamber, Asay told the justices that insurers and Medicaid managers have information about prescriptions because they pay the bills. Pharmacies sell the information only one place, to data miners for marketing.

But she took quite a pummeling from the court's conservative justices.

Justice Scalia: Let's not quibble. The purpose here is to make the drug companies' marketing less effective.

Nor did Scully have by the argument that the law is aimed at protecting doctor privacy. All the doctor has to do is refuse to talk to the drug rep, he said.

Justice Sotomayor: Assuming there is some right not to be harassed, wouldn't it be better if the doctor were required to opt-out of having his information sold? Wouldn't that be less restrictive?

Answer from lawyer Asay: That's exactly what the state does now. The doctor makes a decision one way or the other on the form that he fills out every two years for relicensing.

When Justice Ginsburg noted that the state does seek to promote the sale of less expensive generic drugs in place of more expensive brand names, Chief Justice Roberts piled on.

You want to lower your healthcare costs, not by direct regulation but by restricting the flow of information to doctors, censoring what they can hear.

I disagree, replied Asay, the statute does not limit any of the information that doctors receive. The issue is whether the drug company's right trumps the right of the doctor.

The federal government's lawyer, deputy solicitor general Edwin Kneedler, picked up that thread in support of the state. The patient's privacy is protected by federal law, he observed, and what this law does is put the doctor on an equal footing with the pharmacy in determining how the doctors' information is used. The law, said Kneedler, is not an all-or-nothing statute. Rather, it's much like the Do Not Call or Do Not Mail statute, except that the Vermont law is more limited.

Making the argument for the data mining and drug industry, lawyer Tom Goldstein told the Court that the Vermont law unconstitutionally singles out pharmaceutical marketing.

Justice Sotomayor: Today, with the Internet and computers, there's virtually no privacy individuals have. Any transaction you do could be spread across the world instantaneously. So if the state legitimately has an interest in protecting that part of the public who says I really don't want to sell my name, why can't the state allow you to opt-out to protect your individual information?

It can, replied lawyer Goldstein. But, he said, this statute was not intended to protect privacy and it denies doctors important and truthful information about drugs. What Vermont did here, he said, is have a rule where one side has a much harder time getting its message out.

Chief Justice Roberts: If you were truly concerned about physician privacy, how would you write this statute?

Answer: Then you would bar the pharmacy from giving the information to anybody.

Justice Kagan: How about the pharmacy can't sell it to anybody?

Goldstein said that would not be okay. It protects against commercialization but not privacy. And we, he said, have a capitalist economy.

Chief Justice Roberts noted that pharmacy records wouldn't exist without government regulation and the government frequently controls the use of information it requires. So how is Vermont's law any different from barring a tax accountant from selling the information he's acquired to prepare a tax return?

Answer: The government can bar tax preparers from giving out information to anyone, but not just to certain people and that's what Vermont did here.

If today's argument looked at first like a blowout victory for the industry, by the end of the argument, the justices seemed to find the issues a bit more difficult to resolve.

Nina Totenberg, NPR News, Washington.

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