A Prescription for Caution: Senators Release Investigative Report on Direct-To-Consumer Telehealth Models

Newsletter

On July 17, the offices of Senators Durbin (D. IL.), Warren (D. MA.), Sanders (I. VT.), and Welch (D. VT.) (collectively, “Senators”) released a report summarizing the results of a nine month investigation into direct-to-consumer (“DTC”) models with telehealth integrations utilized by the pharmaceutical companies (“Report”). The report, titled “Big Pharma’s New Sales Scheme: Expanding Patient Access or a Virtual Pill Mill? A Direct-to-Consumer Telehealth Platform Investigation,” focuses on arrangements where pharmaceutical manufacturers enter into arrangements with telehealth platforms to facilitate access to certain of the pharmaceutical manufacturer’s drugs and “boost sales” of these medications (“Programs”). The Report was limited in scope to examination of existing Pfizer and Eli Lilly Programs, but per Senator Durbin, the findings noted in the Report are intended to highlight concerns related to Programs globally and serve as a call to action for additional protections related to these models. Senator Durbin commented “[o]ur findings shine a light on potential conflicts of interest and inappropriate prescribing that can balloon health care spending and lead to inferior care for patients” and noted a need to “crack down” on Programs that “promote and sell expensive medications at the expense of patients and taxpayers.”  

Background: DTC Adverting of Prescription Drugs

DTC advertising of prescription drugs is generally recognized as a meaningful way to market prescription drugs. Drug companies spent $5.15 billion on TV advertisements in 2024 and investment in this DTC advertising appears to be on the rise with the top ten historical spenders investing 30% more in TV commercials in the first quarter of 2025 than they did in 2024. Some analysts estimate a return on investment for DTC drug advertisements “ranging as high as 100%-500%”. In tandem, legislators have expressed concerns about the impact of DTC advertising. For example, Senators Bernie Sanders (I-VT) and Angus King (I-MN) introduced the End Prescription Drug Ads Now Act (“Act”) that would prohibit pharmaceutical companies from conducting DTC advertising of prescription drug products on June 12. The Act follows the Protecting Patients from Deceptive Drug Ads Online Act introduced in September 2024 that sought to impose restrictions on DTC advertising of prescription drugs by social influencers and telehealth providers. The Trump administration and the Department of Health and Human Services (“HHS”) appear aligned with greater regulation of DTC marketing of prescription drugs to consumers. HHS spokesperson Andrew Nixon stated “‘[a]s [HHS] Secretary Kennedy has consistently emphasized, direct-to-consumer pharmaceutical advertising must prioritize accuracy, patient safety, and the public interest — not profit margins’”, noting HHS is “‘exploring ways to restore more rigorous oversight and improve the quality of information presented to American consumers.’”

Report Methodology

The findings in the Report were based on information obtained via written responses from Pfizer and Eli Lilly, telehealth companies, telephone/video calls with stakeholder representatives, reviews of opensource sites (including company websites, LinkedIn, and HealthGrades), and an examination of the federal Open Payments Database and the Medicare Part D Prescriber Look-Up Tool.

Report Findings

While the Report acknowledged the role that telehealth can play in addressing barriers to care, the Report findings focused on potential concerns with Program models. Key findings noted in the Report are summarized below.  

  • A High Rate of Prescriptions Are Written. The Report examined the number of prescriptions that resulted from patient participation in a Program, concluding that the rate was “high”. In one case, the Report noted that 100% of the patients that had a virtual telehealth appointment received a prescription for the drug.  
  • Inappropriate Prescriptions. The Report suggests that, in some cases, visits with telehealth may be “cursory”, the implication being that such visits may not be sufficient to justify a prescription. For example, the Report noted that not all examined telehealth providers required video capabilities to conduct patient visits or require synchronous video or had access to patient medical histories. Per the Report, this could provide the patients with an opportunity to misrepresent information in order to obtain the drug sought. The Report also highlighted a patient’s ability to pre-select which medication they sought to obtain prior to consultation with a prescriber as creating the impression that patients—and not prescribers—were driving decision-making related to prescriptions.
  • Prescribing Data May Result in More Opportunities to Influence Prescribers. Despite the fact that there were no overt incentives to prescribers to induce prescribing, the Report expressed concern that Programs provided manufacturers with prescribing data that enabled them to better target prescribers and influence future prescribing practices.
  • Pharmaceutical Manufacturers Have Access to Extensive Amounts of Patient Data. The extensive amount and types of data that were collected by pharmaceutical manufacturers as part of Programs was noted in the Report. No specific concerns were identified as a result of the collection of this data.
Key Takeaways for Industry

The Report did not conclude any aspects of the Programs examined are unlawful or include any specific calls to action for legislators or regulators as a result of the Report’s findings. Further, the Report did not discuss whether safeguards already exist in the Programs that address or mitigate the concerns identified in the Report. We are aware of a number of Programs that operate in the marketplace that have relevant safeguards. However, it seems clear that at least one purpose of the Report was to warn industry that without appropriate safeguards, Programs could run afoul of the Federal Anti-Kickback Statute (“AKS”). The Report references a HHS OIG 2022 Special Fraud Alert (“Alert”) that urged prescribers to exercise caution when entering into arrangements with telehealth platforms. The Alert limited interactions with the purported patient, limited opportunity to review the patient’s medical records, and/or a directive to prescribe a preselected item regardless of clinical appropriateness as elements of problematic arrangements. While the Report stopped short of applying these elements to findings, the overlap between these problematic elements and the Report findings are apparent. Further, the Report concluded by clarifying that just because a telehealth consultation is not covered under a Federal Health Care program, this did not mean that the AKS was not implicated.

In the wake of the Report and with continuing Federal interest in DTC advertising of prescription drugs, we expect to see additional scrutiny related to Programs from the public, media, legislators, and regulators. Accordingly, stakeholders participating in Programs should consider whether implementation of additional safeguards are merited to address the concerns raised in the Report and part guidance regarding similar programs.

We will continue to closely monitor activity in this area and provide additional updates as needed. If you have additional questions related to the Report, reach out to your Quarles attorney or:

Follow Quarles

Subscribe Media Contact
Back to Main Content

We use cookies to provide you with the best user experience on our website and to analyze statistics related to our website. To understand more about how we use cookies, or for instructions to change your preference and browser settings, please see our Privacy Notice. Please note that if you choose to reject cookies, doing so may impair some of our website's functionality.