UNITED STATES DISTRICT COURT 

DISTRICT OF NEW HAMPSHIRE 

 

IMS HEALTH INCORPORATED, a Delaware ) 

corporation; VERISPAN, LLC, a Delaware ) 

limited liability company, ) 

 ) 

Plaintiffs, ) Case No. 06-CV-280-PB 

 ) 

vs. ) 

 ) 

KELLY A. AYOTTE, as Attorney General of ) 

the State of New Hampshire, ) 

 ) 

 Defendant. ) 

 ) 

______________________________________________________ 

Plaintiffs’ Statement of Facts in Support of Trial Memorandum 

______________________________________________________ 

Thomas R. Julin & Patricia Acosta 

Hunton & Williams LLP 

Fla. Bar Nos. 325376 & 614599 

1111 Brickell Avenue - Suite 2500 

Miami, FL 33131 

305.810.2516 Fax 2460 

tjulin or pacosta@hunton.com 

James P. Bassett & Jeffrey C. Spear 

Orr & Reno, P.A. 

N.H. Bar Nos. 358 & 14938 

One Eagle Square 

P.O. Box 3550 

Concord, NH 03302-3550 

603.223.9100 Fax 9000 

jbassett or jspear@orr-reno.com 

Attorneys for IMS Health Incorporated & Verispan, LLC 

HUNTON & WILLIAMS LLP / ORR & RENO, P.A. 
Case No. 06-CV-280-PB 

TABLE OF CONTENTS

The Health Information Companies.................................................................................................1 

The Information at Issue: Prescriber Identifiable Data....................................................................3 

How the Prescription Information is Used.......................................................................................5 

The Legislative History of the Prescription Restraint ...................................................................10 

The Prescription Restraint Law is Enacted ...................................................................................14

The Prescription Restraint Law Imposes Serious Criminal & Civil Penalties ..............................14 

The Damage Inflicted by the Prescription 

Restraint Law on the Plaintiffs and Others...................................................................................15 

The Plaintiffs Seek Guidance as to Their Rights Under the Law..................................................23 

The Health Information Companies Challenge the Prescriptions Restraint Law..........................23 

The State’s Experts........................................................................................................................24 

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Statement of Facts Expected to be Proved

Based on the declarations filed in the case and the depositions taken in the case following 

approval of the parties’ discovery plan,1

 the plaintiffs expect to prove the following facts at trial.

Citations are to the declarations, depositions, or other evidence that will be offered at trial. The 

parties have stipulated that declarations are not objectionable as hearsay as long as the witnesses 

have been made available for deposition and that depositions also are not objectionable on 

hearsay grounds. 

The Health Information Companies

 1. IMS Health Incorporated and Verispan LLC (the “health information companies”) 

are the world’s leading provider of information, research and analysis to the pharmaceutical and 

healthcare industries, with data collection and reporting activities in over 100 countries. The 

health information companies collect health care information from thousands of sources: 

pharmaceutical wholesalers, pharmacies, physicians, hospitals, and clinics, and process millions 

of records each week. The information collected is then aggregated with other information,

analyzed and made available to customers through dozens of services designed to help them 

drive decisions and shape strategies. None of the proprietary databases owned by the health 

information companies contain patient-identifiable data. This means that the health information 

companies do not collect, process, use or transfer information that contains the identity of 

 1 On September 22, 2006, the Court approved the parties’ discovery plan and thereafter 

the State identified five witnesses whom it intends to call at trial. As of the filing of this 

statement of facts, the State has made available only four of those witnesses for depositions. One 

of the witnesses, Dr. Gary Sobelson was deposed on November 16, 2006. The other three were 

not made available for deposition until November 27 and 28, 2006 -- less than two days before 

the plaintiffs’ trial memorandum was due. Therefore, the plaintiffs contemplate supplementing 

their facts beyond those contained in this statement of facts either with their reply to the trial 

memorandum or at trial. 

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patients in any of their subscription services. (Sadek ¶ 2; Fisher ¶ 3). 

2. The health information companies provide services to pharmaceutical and 

biotechnology firms, pharmaceutical distributors, government agencies, consulting 

organizations, the financial community and others. In addition, the health information 

companies frequently make information available without charge to academic researchers

(researchers at universities throughout the United States), medical researchers (researchers at the 

Centers for Disease Control, the Institutes of Medicine of the National Academy of Science, the 

Mayo Clinic and Memorial Sloan-Kettering), humanitarian organizations (American Red Cross),

law enforcement authorities (state attorney generals, U.S. Department of Justice, the U.S. Federal 

Trade Commission, and the U.S. Drug Enforcement Administration). With the aid of the 

information obtained from the health information companies, these individuals and organizations 

are able to track patterns of disease and treatment, conduct outcomes research, implement best 

practices, and apply health economic analyses. The companies’ databases are essential to 

effective implementation of prescription drug recall programs, performance of pharmaceutical 

market studies, efficient pharmaceutical sales and marketing resource allocation, and assessment 

of drug utilization patterns (e.g., on-and-off label uses and regional variations in physician 

prescribing behavior). (Sadek ¶ 4; Fisher ¶ 4). 

3. The health information companies’ prescriber-level databases are also essential to 

support research, analysis, development and implementation of practice guidelines and public 

health policy for the advancement of patient health. (Sadek ¶ 6; Fisher ¶ 4). 

The Information at Issue: Prescriber-Identifiable Data

4. In the United States, approximately 1.4 million prescribers are licensed to write 

prescriptions. Prescriptions are written for approximately 8,000 different pharmaceutical 

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products and many of these products are dispensed in various forms, strengths, and doses. 

Prescriptions are dispensed by approximately 54,000 retail pharmacies throughout the United 

States, as well as other medical facilities licensed to fill prescriptions. Retail pharmacies in the 

United States are primarily composed of chain pharmacies, independent pharmacies, mass 

merchandisers and food stores with in-store pharmacies, mail order pharmacies, and long term

care pharmacies. (Sadek ¶ 7-9) 

5. Retail pharmacies acquire prescription data during the regular course of business. 

They then license, sell, or transfer the data (without disclosing the patient’s identity) to health 

information companies for two distinct purposes. First, in order to make a profit. Second, they 

license, sell, or transfer the information to the health information companies because those

companies have developed sophisticated methods of aggregating and analyzing the information 

in order to make the information useful to entities that devote substantial resources to improve 

the health and welfare of consumers. (Sadek ¶ 14; Fisher ¶ 10). 

6. For many years, the health information companies have been purchasing patientde-identified prescription information from retail pharmacies, pharmacy benefits managers, 

prescription clearinghouses, payers and software vendors throughout the United States by 

entering into contracts with these entities directly or through intermediaries. (Sadek ¶ 11; Fisher 

¶ 7). The prescription information that the health information companies purchase from New 

Hampshire pharmacies and these other entities include: the name of the pharmaceutical product,

the form, strength and dosage of the product, the quantity dispensed, and the name and address 

of the prescriber. The health information companies do not purchase or acquire patientidentifiable information from pharmacies or these other entities. (Sadek ¶ 12; Fisher ¶ 7). 

7. Currently, health information companies collectively acquire, aggregate and 

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analyze prescription data relating to billions of prescription transactions per year throughout the

United States. They acquire, license, sell, use, or transfer the prescription data for two distinct

purposes. First, to make a profit. Second, to improve public health and welfare by licensing, 

selling, and transferring the data to pharmaceutical companies, and to other persons and entities 

that devote substantial resources to using the information to improve the health and welfare of 

consumers. (Sadek ¶ 13-14; Fisher ¶ 9-10). 

8. Some of the entities to which the health information companies license, sell, or 

transfer the information use the information for advertising, marketing, and promotional 

purposes. These entities and others also use the information for other purposes that are not 

associated in any way with advertising, marketing, and promotional purposes. (Sadek ¶ 15; 

Fisher ¶ 11). 

How the Prescription Information Is Used

9. Upon receipt of the patient de-identified prescription data, plaintiffs’ associates 

combine the prescription data with prescriber reference files for various purposes, including: (a) 

to match each prescription to the correct prescriber, (b) to identify and use the correct name of 

the prescriber, and (c) to add address, specialty and other professional information about the 

prescriber to the prescription data. These reference files are created using information obtained

from various sources. The American Medical Association’s Physician Masterfile, for example, 

is a source of such information for prescribers. The AMA’s Masterfile contains demographic, 

educational, certification, licensure, and specialty information for more than 800,000 active U.S. 

medical doctors (MDs) and over 90% of the doctors of osteopathy (DOs), including members

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and nonmembers alike.2

 (Sadek ¶ 18; Fisher ¶ 14). 

10. The health information companies use the patient de-identified prescription data, 

together with the reference file data, to produce a variety of databases. The health information 

companies use these databases to create a number of different reports and services regarding 

prescribed pharmaceutical products, some of which include prescriber-identifiable information 

and some of which is aggregated and reported at a broader geographic level. They then license

the information to third parties for many different uses. (Sadek ¶ 19; Fisher ¶ 15). Prescriberlevel data, for example, is used by pharmaceutical and biotech clients to: 

a. Prioritize the release of public safety news alerts based on physician 

prescribing details; 

b. Accelerate innovation through insight into the needs and habits of those

whose health the new drugs are designed to improve; 

c. Determine which products to develop and license and what acquisitions to 

consider; 

d. Disseminate effectively and quickly vital, life-prolonging information to 

those prescribers for whom the information is relevant and most useful; 

e. Allocate effectively valuable, life-prolonging sample medications to those

prescribers whose patients need them most and are more likely to use 

them; 

f. Determine whether a particular prescriber is prescribing products the 

pharmaceutical companies have determined to be inappropriate in light of 

the development of new products that may be more effective, safer, or less 

expensive; 

g. Implement prescription drug recall programs; 

h. Evaluate, segment, target, size, compensate and deploy its sales force; 

i. Allocate limited marketing resources to individual prescribers in a manner

 2 As of July 1, 2006, the AMA has made it possible for all physicians, including those 

located in New Hampshire, to choose whether to prevent the release of prescriber-identifiable 

information about them to pharmaceutical sales representatives by participating in the 

Prescribing Data Restriction Program (“PDRP”). See www.ama-assn.org/go/prescribingdata . 

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that reduces cost and saves time; and 

j. Understand managed care’s effect on the U.S. pharmaceutical 

marketplace. 

 (Sadek ¶ 20; Fisher ¶ 16; Ando ¶¶ 16-24). 

11. One key component of pharmaceutical company marketing efforts is the 

distribution of free samples of new drugs to prescribers. Published reports estimate the value of

the drugs distributed annually to be more than $11 billion.3

 These programs allow prescribers 

and their patients to test the efficacy of new drugs for themselves without a financial barrier. 

The pharmaceutical companies use prescriber-identifiable data to try to ensure that they do not 

waste sample products on prescribers who are not engaged in practices to which the samples are 

directly relevant and beneficial. (Frankel ¶ 27). The State’s own medial experts who visit with 

patients on a regular basis in the state of New Hampshire have stated that they interact with 

pharmaceutical sales representatives and accept the free samples that these sales representatives

provide. (Sobelson ¶ 6; Sadowsky 5, 9). 

12. Many doctors find it useful that pharmaceutical sales representatives can access 

data regarding their individual prescribing practices because this (1) helps to ensure that the sales

representatives are providing doctors only with information about products that are relevant to 

their practices, and (2) helps point out to doctors if they may be prescribing products that are not 

as useful to patient health or as economical or as consistent with the latest Practice Guidelines as 

other products. (Wharton ¶ 16). 

13. Doctors recognize that pharmaceutical sales representatives are attempting to 

make a profit for their employers, but also find that they often have excellent information about 

 3 Natalie Mizik & Robert Jacobson, Are Physicians ‘Easy Marks’? Quantifying the 

Effects of Detailing and Sampling on New Prescriptions, 50 Management Science No. 12 at 1704 

(Dec. 2004) (hereafter “Mizik & Jacobson”). 

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the products they are selling, including specific testing information they might not otherwise 

learn about, including recent reports of scientific studies in peer-reviewed medical journals and

recent updates of national guidelines. (Wharton ¶ 13). Sales representatives provide FDAmandated prescribing information for all drugs they discuss (Wharton ¶ 13) and can be a 

valuable source of information about new drugs that supplements the knowledge of a particular 

prescriber (Wharton ¶13). Doctors have available to them a myriad of sources of information 

about new pharmaceutical products, but the information provided by sales representatives can 

help a prescriber stay on top of the information and answer questions that a prescriber may have

after consulting journals, other prescribers, and other sources of information. (Wharton ¶ 13). 

One prominent New Hampshire cardiologist supporting this lawsuit, Dr. Thomas Wharton, a 

former Governor of the New Hampshire Chapter of the American College of Cardiology, 

expressed his view as follows: 

In my opinion, the patient always wins when I make decisions about their health 

based on multiple sources of the most up-to-date published scientific information 

and the latest information on drug cost and formulary status rather than based on 

limited or absent information. 

(Wharton ¶ 13). Dr. Wharton also observed “that many of the physicians that refuse to interact 

with sales representatives may be generally less-informed about current advances in 

pharmacology and slower to adopt the newest best practices.” (Wharton ¶ 15). 

14. The State’s own experts in this case have recognized that marketing efforts by 

pharmaceutical companies can be useful to the medical profession. (Avorn Dep. at 47-48).

15. Pharmaceutical sales representatives’ access to information about an individual 

doctors’ prescribing practices does not result in undue influence to doctors. because doctors are 

professionally, ethically and legally obligated to make decisions that are in the best interest of the 

patient based on the most up-to-date scientific and economic information. Doctors are likewise

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obligated to do everything they can to stay abreast of this most current information. (Wharton ¶ 

16). 

16. It is worth noting that when a generic drug first becomes available on the market, 

pharmaceutical companies very quickly lose most of the market share to the generic drug due to 

the lower price at which the generic drug may be marketed. As a consequence, pharmaceutical 

companies do not devote any substantial marketing resources to promoting branded drugs for 

which generics are available. Such promotion would be a waste of valuable resources that could 

be used to promote the sales of branded drugs for which generics are not available. (Frankel ¶ 

25). 

17. Prescriber-level data compiled and analyzed by the plaintiffs for profit is not, of 

course, used solely in connection with pharmaceutical company marketing efforts. The plaintiffs 

also license the information free of charge to academic researchers, medical researchers,

government agencies, industry observers and others who use the data for a variety of purposes 

that are unrelated to the sale of a particular product (e.g. to support research, analysis, 

development and implementation of practice guidelines and public health policy for the purpose

of advancing patient health. (Hunkler ¶ 9). 

18. Because of the extensive uses of prescriber-identifiable data, doctors do not

expect that information in their prescriptions about their prescribing practices will be kept private 

from the public. Rather, they expect that their patients will share the information with the 

patients’ other physicians, insurers and with friends, family, and others; that pharmacies and 

other similar entities will make the information available to health information companies that

aggregate, analyze, and sell the data for research purposes, and that the data will be made widely 

available to academic researchers, government agencies, pharmaceutical companies and other 

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entities interested in understanding and improving public health. Doctors who do not share these 

expectations, in the opinion of Dr. Wharton, are not fulfilling their professional obligation to put 

their patients’ and the public’s interest in better healthcare above their own putative interests in 

maintaining the privacy of their prescription decisions. (Wharton ¶ 16). 

19. Still, some doctors believe that the ideal way for doctors to make prescribing 

decisions is based on peer-reviewed data rather than from information received from 

pharmaceutical sales representatives. (Avorn Dep. at 45). In order to accommodate these 

prescribers without entirely destroying the public health value that is gained through the ready 

availability of prescriber-identifiable data, the American Medical Association recently adopted a 

program which uses health information companies’ dependence on the AMA Masterfile to allow 

any physician to “opt out” of having his or her prescribing information released to 

pharmaceutical company sales representatives. The program is called Prescribing Data 

Restriction Program (“PDRP”) (Hunkler ¶ 1). Under the PDRP, if a physician advises the AMA 

that she does not want prescribing information regarding her prescribing practices made 

available to pharmaceutical company sales representatives, the AMA license of its Masterfile 

requires that such prescribing information be shielded from pharmaceutical company sales 

representatives. (Hunkler ¶ 12). 

The Legislative History 

of the Prescription Restraint Law

20. On April 19, 2006, New Hampshire Representative Cindy Rosenwald introduced 

House Bill 1346 in the New Hampshire Senate as a law that was meant to protect patient

privacy, by preventing pharmacies from using information about patients to send them

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advertising.4

 She explained that the law would close loopholes in the federal law that protects 

patient privacy.5

 She also claimed that the proposed law should be enacted to protect New 

Hampshire doctors from “an unwarranted intrusion into professional privacy and, more to the 

point, adds to the financial burden of New Hampshire’s health care system by increased 

pharmaceutical costs for the state, our consumers, and our business.”6

 She explained that in her 

view, the ability of pharmaceutical companies to identify the drugs being prescribed by 

individual prescribers allowed them to focus their marketing efforts and that this led to

prescribers writing more prescriptions for the marketed drugs.7

21. House Rep. Pamela Price, a co-sponsor, speculated that preventing 

pharmaceutical companies from accessing prescriber-identifiable data might reduce the state’s 

payment for prescription drugs through the Medicaid program. She noted that the Medicaid 

program had developed a list of drugs by category that “would be acceptable within their range 

based upon the prescribing physician’s interest or . . . belief that one product better suits the 

needs for an individual patient or another.”8

 She briefly noted that some of the drugs within a 

category were more expensive than others and expressed support for the proposed legislation on 

 4 Requiring Certain Persons to Keep the Contents of Prescription Confidential: Hearing

on H.B. 1346 Before the S. Comm. on Exec. Dep’ts & Admin. (N.H. Apr. 19, 2006) (statement 

of Rep. Cindy Rosenwald, Member, House Comm. Health, Human Servs. & Elderly Affairs) at 

10. A transcript of the hearing has been filed as exhibit 3 to the Plaintiffs’ Request for Judicial 

Notice (hereinafter “Senate Hearing”). See also Declaration of Jeremy Eggleton regarding the 

method by which the plaintiffs compiled the legislative history. Page citations in the legislative 

history are to the consecutive page numbers at the lower right-hand corner of the pages, rather 

than to the page numbers of individual documents within the history. 

5

 Id. at 9. 

6

 Id. at 10. 

7

 Id. at 11. 

8

 Id. at 14 (statement of Rep. Pamela Price, Member, House Comm. Health, Human 

Servs. & Elderly Affairs). 

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the strength of her conjecture that if pharmaceutical companies could not obtain prescriberidentifiable data, prescribers would prescribe the cheaper drugs.9

 Rep. Price did not explain how

the proposed restriction on the disclosure of prescriber identifiable information would persuade 

doctors to prescribe the cheaper drugs, she presented no studies that prescription of the cheaper

drugs would lower overall healthcare costs, and she offered no evidence that the cheaper drugs 

were in fact as effective as the more expensive drugs. 

22. Stuart Trachy of the New Hampshire Association of Chain Drug Stores testified 

against the law explaining that it is not needed to protect patient privacy in light of existing

federal legislation.10 He also urged the legislators to consider the fact that the AMA’s PDRP opt 

out program “should take care of any concerns that we have heard in terms of specific doctors 

being concerned that their prescribing data is out there.”11 He also submitted into the record the 

AMA’s written statement in which the AMA emphasized that prescribing data is “critical to

improving quality, safety and efficacy of pharmaceutical prescribing through evidence-based

research.”12

23. Dr. Seddon Savage, president elect of the New Hampshire Medical Society 

testified in support of the bill,13 but acknowledged that physician interaction with pharmaceutical 

representatives is “often very helpful.”14 She explained that she nevertheless supported the law;

that while “most health care providers are highly educated people,” that “studies have shown that

 9

 Id. at 14. 

10 Id. at 18-19 (statement of Stuart Trachy, N.H. Assoc. of Chain Drug Stores). 

11 Id. at 20. 

12 Id. at 20 & 76. 

13 Id. (statement of Seddon Savage, Pres. Elect N.H. Medical Society) at 23. 

14 Id. at 24. 

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in fact our decision making can be and sometimes is shaped by marketing efforts.”15 She

expressed her view that it is “generally better to start from the position of more restrictive access

to information and to really specify what can be released rather than to work backwards as we 

are doing now.”16 

24. Dr. Marc Sadowsky, president of the New Hampshire Medical Society also 

testified in support of the proposed law.17 Like the others at the hearing, he introduced no 

evidence or studies supporting the view that the use of prescriber-identifiable data causes doctors 

to prescribe one drug versus another. Yet, speculated that “doctors switch people from generic 

medicine to a trade name medicine for no apparent reason except presumably that they have been

marketed to effectively.”18 He cited to the Legislature as supposed evidence of this one hearsay 

example of a patient who claimed that another physician had recommended to him that he switch 

from a generic drug to a trade name medicine.19 Sadowsky said he told the patient that it “‘was 

not entirely clear’” to him why the other physician had recommended the change and he then 

speculated from this incident that the other physician had recommended the change in response 

to marketing efforts.20

25. Sadowsky acknowledged that the sample drugs he receives from pharmaceutical 

sales representatives are “an important thing because these medicines cost people thousands of

dollars a year and I have a good number of citizens in New Hampshire that I am giving free 

samples to and I know this is due to the largess for the drug companies, but it is through the 

 15 Id. 

16 Id. at 26. 

17 Id. (statement of Marc Sadowsky, Pres. N.H. Medical Society) at 26. 

18 Id. at 27. 

19 Id. 

20 Id.

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instrument of me who is doing it.”21 

26. In sum, the legislative record reveals a general displeasure by the proponents of

the legislation and their supporters with the effectiveness with which pharmaceutical companies 

market their products using lawfully obtained information about prescribers’ historical

prescribing practices. The displeasure is borne out of the belief that “virtually any time that a 

physician switches to a promoted drug the price increases” because “pharmaceutical companies

focus their promotions on their newest, most expensive medicines.”22 Yet, there is no evidence

in the legislative record that the legislature found or even considered any study suggesting that 

restricting the flow of prescriber-identifiable information to pharmaceutical companies, without 

more, will help reduce the cost of prescriptions in New Hampshire. There is also no evidence in 

the legislative record showing that the legislature considered other alternative means for

achieving its goal of reducing the cost of prescription costs in the state that do not infringe on the 

speech rights of the health information companies. 

The Prescription Restraint Law is Enacted 

27. On May 11, 2006, the New Hampshire Legislature passed House Bill 1346 and 

the Governor signed the bill into law on June 30, 2006. The bill is now 2006 N.H. Laws 328, 

codified at N.H. Rev. Stat. Ann. §§ 318:47-f & 318:47-g & 318-B:12, IV (2006).23 

The Prescription Restraint Law Imposes Serious Criminal & Civil Penalties

28. Any person violating the provisions of N.H. Rev. Stat. Ann. § 318, except as 

otherwise provided, shall be guilty of a misdemeanor if a natural person, or guilty of a felony if 

 21 Id. at 27. 

22 Id. at 35 & 105. 

23 The text of the statute appears on the parties’ Joint Stipulation of Facts filed on

November 30, 2006. 

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any other person. N.H. Rev. Stat. Ann. § 318:55.24 A civil penalty not to exceed $5,000 also

may be imposed upon any person who willfully or repeatedly violates any provision of chapter 

318. N.H. Rev. Stat. Ann. § 318:55. 

Damage Inflicted by the Prescription 

Restraint Law on the Plaintiffs & Others

29. Following passage of the act and as a consequence of the severe criminal and civil 

penalties that it authorizes, sources of prescription data required restrictions placed on the 

prescription data in order to ensure compliance with the act. (Sadek ¶ 27). In order to continue 

acquiring prescription data while it challenges the constitutionality of the Prescription Restraint 

Law, IMS Health has entered into agreements with its sources of prescription data that state that

IMS Health will not use the prescription data for purposes that are prohibited under the act until 

such time as the act is declared unconstitutional or otherwise invalidated or enjoined. (Sadek 

¶28). Verispan also has modified its practices so that it may continue to acquire data and use it 

for purposes allowed by the law and will not use it for purposes that are not permitted by the law. 

Specifically, Verispan has decided to modify its databases so that it can identify and suppress the 

prescriber-identifiable data from New Hampshire prescriptions from its subscription services

before the prescription information can be released to pharmaceutical companies or other third 

parties. (Fischer ¶ 22). 

 24 N.H. Rev. Stat. Ann. § 318 does not specify a classification of the misdemeanor and 

therefore the misdemeanor is classified as class A. N.H. Rev. Stat. Ann. § 625:9, IV(a)(2). A 

natural person convicted of a class A misdemeanor may be imprisoned for up to one year and 

fined up to $2,000, and a corporation convicted of a felony may be fined up to $100,000, plus 

double the amount of any amount made by the commission of the felony. N.H. Rev. Stat. Ann. § 

651:2, II.(d), IV.(a) & IV.(b). Any person who violates any provision of N.H. Rev. Stat. Ann. § 

318-B for which a penalty is not provided by other paragraphs shall be guilty of a class B felony 

if a natural person, or guilty of a felony if any other person. N.H. Rev. Stat. Ann. § 318-B:26, XI. 

A natural person convicted of a class B felony may be imprisoned for up to seven years and fined 

$4,000. See N.H. Rev. Stat. Ann. § 651:2, II.(b) & IV. (a). 

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30. Thus, both IMS Health and Verispan have had to cease some of their regular 

business practices in buying and selling records containing prescriber-identifiable data because

pharmacies and other similar entities cannot continue providing prescriber-identifiable data to 

IMS Health for purposes restricted by the act. (Sadek ¶ 28; Fisher ¶ 23). 

31. The Prescription Restraint Law is inflicting damage on the New Hampshire 

pharmacies who are s a willing speakers in the possession of information that is of great public 

importance and wish to provide that information to others who would use the information for

important purposes. (Dobish ¶ 12). 

32. Moreover, because IMS Health is unable to provide customers with prescriberidentifiable data originating from New Hampshire, IMS is unable to continue licensing this 

information to customers for a fee. (Sadek ¶ 31; Fisher ¶ 24). As important, the plaintiffs are

being injured each day that the Prescription Restraint Law remains in force because they are

unable to communicate to pharmaceutical companies lawfully obtained, truthful information 

about matters of public importance and concern -- the prescribing practices of New Hampshire 

prescribers. While the information remains locked in the plaintiffs files, it cannot be used by

pharmaceutical companies and others for all of the socially useful purposes described above.

The statute also inflicts irreparable injury on the pharmaceutical companies that wish to 

communicate with prescribers, and most importantly, it prevents important information from 

getting to prescribers to help them make the best decisions they can make about the drugs that 

they will prescribe for their patients. (Sadek ¶ 32). 

33. Ultimately, the plaintiffs succeed as companies only as long as they can continue 

to deliver valuable information that helps pharmaceutical companies and others efficiently

deliver effective, innovative and safe healthcare products to the public. The Prescription 

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Restraint Law directly impairs the ability of the plaintiffs to fulfill that mission in New 

Hampshire. (Sadek ¶ 33; Fischer ¶ 25). 

34. Dr. Göran Ando, who has served as the director of research and development for 

two of the world’s largest pharmaceutical companies -- Glaxo and Pharmacia -- explains in his

declaration that the decision of health information companies not to continue providing 

prescriber-level health information due to the risks created by the Prescription Restraint Law 

seriously impairs the ability of pharmaceutical companies to do basic medical research as well as

to carry out marketing functions that are necessary to obtain market adoption of drugs that 

improve public health. (Ando Dec. ¶¶ 13-24). 

35. Dr. Ando explained that the prescriber-level data is especially needed in phase 3 

human clinical trials of new drugs which now require a substantial number of patients. (Ando 

Dec. ¶ 13). Identifying suitable patients for phase 3 trial can be very difficult because each phase

3 clinical trial establishes a rigorous protocol for exclusion or inclusion of a patient in a trial to 

find a homogeneous population. (Ando Dec. ¶ 13). Prescriber-identifiable data from 

prescription records shows which prescribers are writing large numbers of prescriptions for drugs 

for patients who would be logical participants in phase 3 human clinical trials of the new drugs

and allows companies to contact those prescribers to ask that they ask their patients to consider

participation in the trials. (Ando Dec. ¶ 13). Use of the prescriber-level data reduces the time 

that is needed to locate patients for clinical trials from three to six months for many clinical

trials. (Ando Dec. ¶ 13). 

36. Dr. Ando also explained that prescriber-identifiable data is essential to carrying 

out Risk Minimization Action Plans or Risk MAPs required by the United States Food & Drug 

Administration. (Ando ¶ 14). Risk MAPs explain how a manufacturer intends to study the 

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health effects of a new drug on patients after the drug has been approved and is being prescribed. 

In order to execute Risk MAPs, pharmaceutical companies must be able to identify prescribers

who are prescribing a certain drug so that they can obtain information about health effects of a

new drug on patients. (Ando ¶ 15). Without prescriber-identifiable prescription data, 

pharmaceutical companies have a much more difficult time executing Risk MAPs and cannot 

execute them as quickly and efficiently as they now do. (Ando ¶ 15). 

 37. Prescriber-identifiable data also is useful in the development of new drugs 

because it provides researchers a means of identifying the prescribers who are most frequently 

prescribers of certain drugs or a class of drugs. (Ando ¶ 16). This allows researchers who are 

attempting to develop new drugs to contact prescribers who prescribe certain drugs directly to

learn about the uses to which the prescribed drugs are being put. (Ando ¶ 16). This, in turn, can 

help researchers ascertain whether new drugs can and should be developed for the same use. In 

some instances, new drugs can be far less costly for treating a particular health problem than 

existing drugs. (Ando ¶ 16). Moreover, knowledge about individual prescriber practices greatly 

facilitates research regarding the health outcomes of using drugs in combination. This is one of 

the most rapidly developing areas of drug research. (Ando ¶ 16). 

38. If pharmaceutical companies and their sales representatives are unable to obtain 

information about prescribing practices, they will not, of course, discontinue their sales efforts 

because the Prescription Restraint Law does not prohibit them from marketing directly to 

prescribers. Instead, sales representatives will continue to market their products, but they will be 

unable to focus those marketing efforts on the prescribers who are most likely to prescribe the 

drugs they are marketing. (Frankel ¶ 27). Marketing campaigns that are not focused by 

prescriber information typically are much more expensive than marketing campaigns that are not 

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focused by such information. Unfocused campaigns allocate inadequate samples to the doctors 

who need them and who will use them the most. Instead, samples are evenly distributed among 

all doctors according to specialty. As a result, waste of the samples occurs. This type of 

unfocused marketing drives up the cost of marketing products and may ultimately drive up the 

cost of the products themselves. This also slows adoption of drugs by the market. (Frankel ¶ 

27). 

39. Without information about prescribing practices, pharmaceutical companies are 

unable to identify those prescribers who are willing to adopt innovative drugs when the drugs 

first become available in the market. The benefits of rapid market adoption of new drugs is 

demonstrated by the innovations that the pharmaceutical industry has produced and the fact that 

at each stage of life -- from early infancy through old age -- innovative drug discoveries now 

help millions of patients lead longer, healthier, happier, and more productive lives. But modern 

drugs do even more than save lives and improve the well-being of patients. As they improve

health, they also save money by keeping people out of hospitals, emergency rooms, and nursing 

homes. A goal of pharmaceutical sales representatives is to identify opportunities to accelerate 

the adoption of highly valuable innovations that will benefit patients and help contain overall 

health costs. (Frankel ¶ 29). 

40. If so-called “early adopters” cannot be identified, then marketing must be directed

to all prescribers, including those who are least likely to adopt an innovative drug. This can 

drastically slow acceptance of a new drug in the market because some prescribers rely on early

adopters to prescribe a new drug so that additional information regarding the safety and 

effectiveness of the drug will be reported before the prescriber prescribes the drug. This not only

denies the late adopting prescriber’s patients the benefits of the new drug, but also deprives those 

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patients of information crucial to their decision on whether or not to use the new drug (i.e, that 

wide-scale early adopter market use of a drug will reveal side-effects not discovered in the drug 

testing and approval process). Neither early adoption nor later adoption of new drugs is 

necessarily the “best practice” -- both approaches can be defended -- but it is a reality of the drug 

marketplace that is important for pharmaceutical companies to be aware of so that they can 

market the new drugs to prescribers who will prescribe them. When new drugs that have been

tested and approved are not adopted or adopted very slowly this generally harms public health 

and increases the overall cost of public healthcare. (Frankel ¶ 28). 

41. The New Hampshire Legislature’s assumption that the marketing of new, branded 

drugs by pharmaceutical companies discourages physicians from writing prescriptions for 

equivalent generic drugs ignores the fact that manufacturers stop marketing branded drugs as 

soon a they lose patent protection or exclusivity rights for a particular drug. (Cole ¶¶ 9-10). 

Thus, prohibiting pharmacies and similar entities from communicating prescriber-identifiable 

data from prescription records will not, in Dr. Cole’s opinion, significantly reduce the number of 

prescriptions being written for branded drugs that are not protected by patents or other 

exclusivity rights. (Cole ¶ 21). 

42. In addition, the New Hampshire Legislature did not consider the fact that 

prescribers have good reasons unrelated to the messages they receive from pharmaceutical 

companies to continue to prescribe branded drugs for a significant number of patients. In 

prescribing medication for some illnesses, like epilepsy, physician prescribers pay close attention 

to the precise amount of medication that is absorbed by the patient and avoid switching patients 

from a branded drug to a generic drug to avoid the risk that the patient will absorb significantly

more or less of the medication than the patient was absorbing while taking the branded drug and 

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that the new level of absorption will place the patient outside of the range necessary to control 

the patient’s seizures. (Cole ¶ 13-15) . This is one reason that certain doctors, particularly those 

who treat epileptic patients, such as Dr. Cole, have been reluctant in their practice to switch a 

patient from a branded drug to a generic drug. Id. Thus, regardless of the marketing associated 

with a epilepsy drugs, some doctors realize that branded drugs are produced by a single

manufacturer while a generic drugs may be produced by many different manufacturers and each 

manufacturer may produce the generic drug in a manner that alters the bioavailability of the 

active ingredient in the drug. (Cole ¶ 16). This alteration in the absorption rate may result in the 

patient experiencing seizures that otherwise would have been avoided if the absorption rate had 

remained steady. (Cole ¶ 16). Moreover, Dr. Cole believes that the subtle differences in 

formulation of the filler, dye, and shape allowed for generic drugs as well as complaints from 

patients who do not believe that a generic drug will be as effective as a branded drug also may 

account for different reactions that patients have to a generic drug and to a doctor’s decision to 

prescribe a branded drug versus a generic drug. (Cole ¶ 15-18). 

43. By preventing companies from acquiring prescriber-identifiable data for the 

“commercial purpose” of influencing sales or market share of a pharmaceutical product and to

influence and evaluate the prescribing behavior of an individual health care professional, the

Prescription Restraint Law potentially affects organizations that are not in the business of 

manufacturing or selling pharmaceutical drugs but are nonetheless devoted to improve the 

quality, safety and efficiency of medical care. 

44. For example Dr. John Glaser, vice president and chief information officer of 

Partners HealthCare in Massachusetts, has expressed concern about the Prescription Restraint 

Law’s potential to affect activities of New Hampshire prescriber organizations that seek to use

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prescriber data to improve their practices. Partners HealthCare has implemented a variety of 

systems to monitor the prescribing practices of doctors to ensure that members of Partners are 

prescribing according to current practices. These systems attempt to improve collectively the 

prescribing practices of all doctors participating as members of Partners HealthCare. In order to 

determine whether patients are getting appropriate care, Partners HealthCare needs to know not 

just what is prescribed by the doctor, but also what prescriptions actually are filled by the 

pharmacist. (Glaser ¶ 10). Partners HealthCare’s systems therefore collects information about 

the drugs that member doctors are prescribing and about the prescriptions that are being filled. 

Partners HealthCare uses that information to help educate doctors about breakthrough drugs that 

have become available and that may offer their patients better alternatives to the drugs that are 

currently being prescribed, drugs that are more cost effective than the drugs that are being

prescribed and drugs that are safer than the drugs that are being prescribed. (Glaser ¶ 11). This 

information about the prescribing practices of its physicians is collected through managed care 

organizations and depicts the drugs prescribed and drugs that the patient takes. Partners 

HealthCare regularly analyzes that information and then communicates directly with its members 

about alternative prescribing practices that might improve the health of patients in order to 

attempt to improve the quality, safety and cost effectiveness of the care delivered by its doctors. 

(Glaser ¶12-13). The potential for increased doctor income is also a critical consideration in the 

acceptability of this oversight. Id. Partners HealthCare’s systems for analyzing the prescribing 

practices of individual members often are used to influence sales or market share of a 

pharmaceutical product and to influence and evaluate the prescribing behavior of an individual 

health care professional. (Glaser ¶15). Thus, the activities of Partners HealthCare and its use of 

prescriber identifiable data closely resemble the activities of pharmaceutical manufacturers, who 

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like physicians, are interested in improving the practice of medical care and increasing their 

profitability and do so with the use of prescriber identifiable data. Therefore, the Prescription 

Restraint Law’s restrictions on the flow of prescribe-identifiable data has the potential of

affecting a whole range of activities conducted by organizations other than pharmaceutical 

manufacturers. 

Plaintiffs Seek Guidance as to Their Rights Under the Law

45. After passage of Prescription Restraint Law, IMS Health sought guidance from 

the Attorney General both in writing and in person on how the State would seek to interpret and

enforce the law. Assistant Attorney General Richard Head tried to be helpful, but ultimately was

unable to provide any assurance that the health information companies or their sources could not 

or would not be prosecuted if they continued their existing business practices. Asst. Atty. Gen. 

Head confirmed that the Attorney General would enforce all provisions of the law and defend its 

constitutionality if it were challenged. (Mahon Dec. ¶ 7-15). 

46. The plaintiffs have concrete plans to engage immediately in activity which 

appears to be proscribed by the Prescription Restraint Law. Those concrete plans are to continue 

the purchasing and selling of patient-de-identified prescription information for commercial 

purposes that are ostensibly prohibited by the Prescription Restraint Law. The plaintiffs therefore

have a reasonable fear that they will be prosecuted criminally for executing their plans and that

an action for injunctive relief and damages will be brought against them by the Attorney General,

a County Attorney or by private citizens if they execute those concrete plans. (Mahon ¶¶ 8-9).

The Health Information Companies Challenge the Prescriptions Restraint Law

47. On July 28, 2006, the health information companies filed a complaint for

declaratory and injunctive relief and motion for preliminary injunction asking the Court to 

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invalidate the portions of the Prescription Restraint Law that criminalize the licensing, sale, 

transfer and use of prescriber-identifiable data for commercial purposes. The health information

companies emphasized that they were not challenging the portions of the Prescription Restraint 

Law that addressed patient-identifiable data. 

48. On August 7, 2006, the plaintiffs moved for an expedited status conference. At a 

status conference that took place on September 5, 2006, the plaintiffs asked the Court to schedule 

a an expedited hearing on the motion for preliminary injunction because the plaintiffs First 

Amendment rights were being affected with each day that the Prescription Law remained in 

effect. The Court decided to allow the State an opportunity to engage expert witnesses to 

defend the constitutionality of the statute and engage in discovery of the plaintiffs’ witnesses. 

49. On September 21, 2006, the Court approved the parties’ discovery plan and 

schedule the case for trial to commence on January 25, 2006. On October 13, 2006, the Court 

amended the trial period to commence on January 29, 2006. 

The State’s Experts

50. Pursuant to the parties’ discovery plan, the State identified five witnesses whom it

intends to call at trial. The depositions that have been completed of the State’s witnesses reveal 

the State’s intention to engage in post-hoc attempts to justify the Prescription Restraint Law 

through their experts. The State’s expert witnesses Drs. Jerry Avorn and Gary A. Sobelson 

testified that they were not consulted by the state of New Hampshire prior to the passage of the

law and had no input in the drafting of the legislation. (Avorn Dep. at 7; Sobelson Dep. 12-13). 

51. Notably, the testimony of the State’s experts showed that the Prescription 

Restraint Law will do little, if anything, to stop doctors from prescribing branded drugs when 

generic drugs become available because there are a number of factors, other than pharmaceutical 

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detailing, that affect a physician’s decision to prescribe a branded drug when a generic drug is 

available. Dr. Gary A. Sobelson, for example, acknowledged that he prescribes branded drugs

when generic drugs are available not necessarily because of pharmaceutical detailing but because

branded names are easier to remember, he is not always aware of the existence of generic 

equivalents or simply because he relies on pharmacies to dispense available generic drugs even

he prescribes branded drugs. (Sobelson Dep. 141-43). 

52. Moreover, none of the State’s experts were able to point to the existence of any 

studies showing that restricting the free flow of prescriber-identifiable data will result in an

increase of prescriptions of generic drugs in the state of New Hampshire. Dr. Jerry Avorn 

acknowledged that although he has 25 years of experience in the filed of pharmacoepidemiology 

and pharmacoeconomics, he had never previously advocated imposition of a restriction on the 

dissemination of prescriber-identifiable data as a means of increasing the likelihood that a 

prescriber would prescribe a generic drug in lieu of a branded drug. (Avorn Dep. at 21, 103). 

53. He testified that although he has advocated for many years the curb of excessive 

influence of pharmaceutical promotion, he never advocated the enactment of legislation of the 

type at issue in this case. (Avorn Dep. at 13-14). 

54. Dr. Avorn’s testimony brought to light the many different alternatives that the 

New Hampshire could have pursued to achieve its objectives that do not involve the restriction 

of speech. For example, Dr. Avorn acknowledged that any suboptimal prescribing practices that 

are caused by the effectiveness of the marketing conducted by detailers can be counteracted 

through the implementation of “academic detailing” whereby doctors are exposed to sciencebased information about drug performances. (Avorn Dep. 54-57). This approach, which has

been implemented in the state of Pennsylvania, advocates more, not less, information to be made 

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available to doctors to help them drive decisions. (Avorn Dep. 58). Yet the state of New 

Hampshire does not appear to have attempted to implement an academic detailing program at 

any time prior to the passage of the Prescription Restraint Law. (Avorn Dep. 64). 

55. Other alternatives that Dr. Avorn advocates to counteract suboptimal prescription 

practices include: (a) a the requirement of prior authorization from the payor the drugs before a

doctor could prescribe a branded drug for which a less costly generic is available, modification 

(Avorn Dep. 64-69); a differential co-payment system whereby patients are required to pay for

the difference between a branded and a generic drug when they choose to purchase the branded 

drug; (Avorn Dep. 73-4); modification of existing patents law to make more difficult for 

pharmaceutical companies to manufacture new drugs that have result in minimal or no 

improvement over existing drugs (75-6); and drug importation whereby patients could feely 

purchase cheaper drugs from other nations outside the United States. (Avorn Dep. 77-79). 

56. Dr. Avorn and Dr. Sobelson both acknowledged that not all pharmaceutical 

detailing results in costlier or suboptimal prescribing and that there are instances in which such 

detailing could be useful to the medical community. (Avorn Dep. 44, 48-49; Sobelson Dep. 82-

83). Yet they believe that the Prescription Restraint law is a step in the right direction because 

it would make it more difficult for manufacturers to present their messages to prescribers.

(Avorn Dep. 228; Sobelson Dep. 150-51). 

57. In late October, the Attorney General hired for the flat fee of $5,000, Shahram 

Ahari (Ahari Dep. 16), an Eli Lilly sales representative for a year and a half (Ahari Dep. 148), to 

testify concerning how he and others employed by manufacturers used prescriber identifiable 

data more than six years ago. He testified that the information allowed sales representatives to 

identify the prescribers to whom they would direct their messages and that the messages that 

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Case No. 06-CV-280-PB 

they delivered were always truthful. (Ahari Dep. 78). He testified he resigned as a sales 

representative in June 2000 because he came to believe that even truthful messages led some

prescribers to make less than optimal decisions. (Ahari Dep. 148-52). He testified he could not, 

consistent with his own morality, continue to work for Eli Lilly, although he did not tell Eli Lilly 

this when he resigned. (Ahari Dep. 151). He also testified, however, that when he could not find 

other employment, that he applied to become a sales representative with Novartis, another 

manufacturer, but that company rejected his employment application. (Ahari 191). He

explained that his current knowledge of detailing practices is based largely on his recent contact 

with “Jenna,” an “acquaintance” and current employee of Eli Lilly whose last name, telephone 

number, and e-mail address he could not recall during his deposition. (Ahari Dep. 163-64). 

Today Mr. Ahari is a temporary employee of the University of California at San Francisco. He 

tries to identify cases of poisonings that may have adverse public health consequences. He 

expects that employment to terminate in April 2007. (Dep. Ahari 203-04). 

 Respectfully submitted, 

Hunton & Williams LLP 

By /s/ Thomas R. Julin 

Thomas R. Julin & Patricia Acosta 

Fla. Bar Nos. 325376 & 614599 

Admitted Pro Hac Vice 

1111 Brickell Avenue - Suite 2500 

Miami, FL 33131 

305.810.2516 Fax 2460 

tjulin or pacosta@hunton.com

Orr & Reno, P.A. 

James P. Bassett & Jeffrey C. Spear 

New Hampshire Bar Nos. 358 & 14938 

One Eagle Square - P.O. Box 3550 

Concord, NH 03302-3550 

603.223.9100 Fax 9000 

jbassett or jspear@orr-reno.com 

Attorneys for IMS Health Incorporated and Verispan LLC 

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Case No. 06-CV-280-PB 

CERTIFICATE OF SERVICE

I hereby certify that a true and correct copy of the foregoing was served by electronic 

filing on November 30, 2006, to: 

 Richard Head

 Assistant Attorney General of the State of New Hampshire 

 33 Capitol Street 

 Concord, NH 03301 

 603.271.3658 Fax 2110 

s/ Thomas R. Julin 

 

HUNTON & WILLIAMS LLP / ORR & RENO, P.A.