Albertsons is heading to court on allegations that the grocer is selling confidential medical information to several pharmaceutical companies.
A lawsuit charges that Albertsons pharmacy units violated the privacy rights of thousands of customers by illegally using their confidential prescription information to conduct marketing campaigns on behalf of drug companies. The lawsuit names over a dozen pharmaceutical companies as co-conspirators, including Proctor & Gamble, Aventis, Bristol-Meyers Squibb and Pfizer.
"We feel this practice violates the spirit and letter of patient confidentiality," said Beth Givens, director of the Privacy Rights Clearinghouse (PRC), a consumer group which filed the lawsuit around three years ago in California Superior Court.
Recently, the drug company Eckard reached a confidential out-of-court settlement for a similar case, which included an agreement to stop such intrusive marketing practices. Albertsons and the other defendants are expected to appear for a court trial, likely late this year.
The complaint states Albertsons' pharmacy customers currently receive direct mail and phone solicitations derived from their medical information provided to the pharmacy for prescriptions. The solicitations appear to be from a local concerned pharmacist, but are allegedly created by a specially designed database, sold by Albertsons. Givens explains the pharmaceutical companies write or approve the solicitations before they are deceptively mailed by Albertsons marketing personnel on material using Albertsons letterhead.
"Albertsons receives between $3 and $4.50 per inquiry letter and between $12 to $15 per phone inquiry from the pharmaceutical companies," she says.
Jeffery Krinsk, a lawyer representing the PRC, told BW the consumer group wants Albertsons to stop this practice and to give customers the money received for their prescription information. Krinsk warned he is sure this routine is taking place in other states, but explains this lawsuit was filed in California due to its stricter privacy laws. He said additional lawsuits are planned for other states, if appropriate.
"I imagine this is going on in Idaho," he says, "But it is not currently on our radar, due to its state laws that are more unprotective of consumers in areas of privacy and medical confidentiality."
Recent changes to U.S. Department of Health and Human Services regulations may allow pharmaceutical companies to access patients' personal medical records, but some state laws are more strict about the confidentiality of patient medical information. Krinsk says the lawsuit has helped spur privacy advocates to take a closer look at how privacy laws vary from state to state and at the practices of other drug chains. "We hope to clean up this area (of privacy abuse) with a single precedent-setting resolution," he says.
Karen Ramos, Albertsons public affairs director for the Drug Division, responded to the lawsuit in a written statement. "We highly value and respect the privacy of our pharmacy customers and do not sell, nor have we ever sold, their private information," she said. "We consider the allegations in this complaint to be false and totally without merit-and we will vigorously defend ourselves against them."
Albertsons and its affiliated companies are the second-largest supermarket chain and fifth largest drugstore in the nation with more than 2,500 stores in 37 states nationwide. Its 2004 annual revenues exceeded $39 billion.
For more information, contact:
Privacy Rights Clearinghouse at: (619) 298-3396 or www.privacyrights.org.
Albertsons, Inc. at: (877) 932-7948 or www.albertsons.com.