Skip to Content

Drug and Device Makers Shelled Out $8 Billion to Doctors and Hospitals Last Year

View of stethoscope on table in laboratoryView of stethoscope on table in laboratory
More than $8 billion transferred from pharma to hospitals and docs in 2016Photograph by Chris Cross via Getty Images/Caiaimage

One of Obamacare’s biggest transparency provisions is the Sunshine Act, which requires medical device and drug makers to disclose how much money they pony up to doctors and teaching hospitals. And for the third consecutive year, the figure has risen—to the tune of $8.18 billion in total 2016 payments, according to the Centers for Medicare and Medicaid Services (CMS). That’s up from $7.52 billion in 2015 and $7.49 billion in 2014.

Click here to subscribe to Brainstorm Health Daily, our brand new newsletter about health innovations.

The figure includes payments from 1,481 companies to 631,000 physicians and 1,146 teaching hospitals. This money can serve a variety of purposes, such as research funding (approximately half of the 2016 payments) and ownership and investment interests. But it can also be used to pay for doctors’ speeches, continuing medical education, meals, and travel.

So who were some of the biggest spenders? Pharmaceutical giant Allergan took the number one spot with $66 million in payments while biotech Celgene rang in at number two with $54 million.

Watchdog groups and transparency advocates say that it’s important to have this information in hand to analyze whether or not the payments are linked to clinical decision-making. And at least some previous research suggests a correlation. For instance, a ProPublica analysis from last year found that doctors who receive a higher share of payments from drug and device makers are also more likely to prescribe pricier brand name drugs.