DRUGS + POLITICS
Drugmakers Prodded by FDA for Neglected Disease Drugs (Update3)
By Catherine Larkin
June 18 (Bloomberg) -- Roche Holding AG, Johnson & Johnson and Biogen Idec Inc. are being urged by U.S. regulators to see if existing medicines may help neglected disorders, after an incentive program failed to spark research on new therapies.
The Food and Drug Administration published a list of 235 treatments today that may have benefit in rare disorders and already have marketing clearance for other uses. Identifying “low-hanging fruit” may compel large drugmakers to look beyond common ailments with guaranteed consumer demand, said Tim Cote, head of the agency’s Office of Orphan Product Development.
The list includes Roche’s hepatitis drug Pegasys, J&J’s leukemia medicine Leustatin and Biogen Idec’s multiple sclerosis drug Avonex. Regulators need new tactics since an experiment two years ago to give priority review vouchers in exchange for new drugs for tropical diseases drew only one participant.
“Large pharmaceutical companies are not as engaged as we’d like to see them be,” Cote said in a phone interview. “I myself have knocked on the doors of all the big boys.”
About 30 million Americans have one of 7,000 rare diseases, defined by the FDA as conditions affecting fewer than 200,000 people in the U.S. Medicines developed to treat these conditions are called orphan drugs, under rules that encourage their development.
2,150 Orphan Designations
More than 2,150 potential treatments have been identified since the 1983 Orphan Drug Act promised seven years of market exclusivity to any product approved for a rare disease. To date, only 358 are on the market, and most are made by small, specialized biotechnology companies.
“This is not something that companies are thinking about on a regular basis,” said Ira Loss of Washington Analysis, who has followed the FDA for more than three decades. “If things were better in terms of the general economy and the pipelines of these companies, where they had time to focus on this possibility, it might be a different story.”
The FDA’s list focuses on orphan designations that have been given to drugs whose approval in other uses suggests they’re not toxic, Cote said. Anyone can apply for orphan drug designation without the current manufacturer’s permission, according to Sandy Walsh, an FDA spokeswoman.
Roche’s Pegasys has orphan status for chronic myelogenous leukemia. Leustatin, made by New Brunswick, New Jersey-based J&J, is approved for hairy cell leukemia but has had orphan drug designation since 1990 for chronic lymphochytic leukemia and acute myeloid leukemia. Also on the list is Biogen’s top-selling MS drug Avonex, which has had orphan designation since 1991 as a treatment for cutaneous t-cell lymphoma.
Companies Respond
While Biogen initially pursued Avonex in “several indications” the Cambridge, Massachusetts-based drugmaker now has no plans to develop it for cutaneous t-cell lymphoma, said Kate Weiss, a company spokeswoman.
“While we’re certainly always open to looking at new indications for all of our drugs, we’re not pursuing that for that indication,” Weiss said today in a phone interview.
J&J decided not to further develop Leustatin in part because there are other drugs available for leukemia, Ernie Knewitz, a spokesman for the company, said today in a telephone interview. J&J is studying products for other types of neglected diseases including the areas of oncology, HIV and hepatitis C, Knewitz said.
Roche is no longer studying Pegasys in cancer, said Kristina Becker, a spokeswoman for the Basel, Switzerland-based company’s Genentech unit.
‘Long History’ of Development
“The company has pursued studies and applications for several orphan indications,” Becker said today in an e-mail. “We have a long history of developing new medicines for diseases where there are no existing therapies even if not many patients are affected.”
Companies may worry that increasing pressure to cut medical costs will limit their pricing power, making it harder to recoup the cost of their investment in research from the small number of patients taking a medicine, Cote said. Orphan drugs that have other uses may also still be victim to generic substitution, effectively limiting the promise of seven years of market exclusivity.
“The lack of research and lack of treatments is something we see every day,” said Mary Dunkle, a spokeswoman for the National Organization for Rare Disorders in Danbury, Connecticut. “It’s very frustrating for the families.”
The FDA tried a new strategy in 2008 by offering priority review vouchers for companies who win approval of drugs for one of 16 tropical diseases. The vouchers will shave four months off the regulatory review of any new product for which a company uses it. The vouchers also can be traded or sold.
Broadening Vouchers?
Novartis AG, of Basel, Switzerland, has so far won the only voucher -- for a 10-year-old malaria pill -- and hasn’t used it. Cote said he is considering broadening the list of conditions eligible for a voucher “within a couple months” to spark interest in the program.
Drugmakers are skeptical about vouchers, especially as an increasing number of drugs with priority review face delays, said Ramsey Baghdadi, a health-care analyst at Prevision Policy in Washington. He isn’t convinced that either initiative will be enough to encourage companies to invest in orphan-drug research they wouldn’t otherwise do.
“Nothing would hold a pharma company back from going after something if they really wanted to go after it,” Baghdadi said. “The real route is through patent extension or increased market exclusivity. People understand the value of that.”
The FDA will solicit feedback on how it approves and encourages medical products for rare diseases at a June 29-30 public hearing at its headquarters in Silver Spring, Maryland.
--Editors: Angela Zimm, Bruce Rule
To contact the reporter on this story: Catherine Larkin in Washington at [email protected].
Source:Bloomberg Business Week
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Canada's Big Pharma Drug War
by Dr. Joel Lexchin
The Ontario government has recently announced major changes to the way that it will pay for generic drugs for those covered under its public drug plan, primarily people 65 and over and those on social welfare. The aim is to rein in rapidly increasing costs for the Ontario Drug Benefit Program. Up until recently spending has been going up by more than 10% annually and overall across Canada drug costs are the second most expensive part of the health care system behind only hospitals.
The current government made a first attempt to deal with drug spending back in 2006 when it reduced the price for generic medicines from 70% of the brand name drug to 50%. At that time, $222-million in savings (from a drug bill of $3.5-billion) from reduced generic prices and other reforms was predicted. There was never any independent analysis about whether those anticipated savings were realized. Now faced with a deficit of over $20-billion and health care costs that take up 42 cents of every public dollar, the government is looking at a new initiative to rein in at least one segment of health care costs. The question of whether that 42-cent figure represents too much spending on health care or is mostly the product of a series of tax cuts that have reduced government revenue is a crucial issue that must be taken up soon.
The Politics of Generic Drugs
One of the key factors that makes public drug plans affordable is the existence of generic versions for many of the products that are on the provincial formulary. Generic drugs work the same as the original brand-name products but are much lower in cost since generic companies don't incur the research and development expenditures and also don't engage in costly promotion of their products.
However, in order for generic drugs to get used they need to be dispensed by pharmacists and this gives the pharmacy owners a huge stick in dealing with the generic companies. In effect what the pharmacy owners tell the generic companies is that they will not stock their products unless the companies sell to them at a discount. The pharmacy owners are reimbursed by the government at the list price of the medication not the discounted price. Therefore, the discount goes to the pharmacy owners not the government. These discounts amount to about 20% of the price of the drug.
What the government is now proposing to do is to eliminate these discounts, also referred to as professional allowances. Savings from making this change are projected by the government to amount to $750-million annually which would be a substantial reduction in the annual $4.14-billion that the government spends on prescription medications.
The pharmacy owners, primarily the large chains such as Shoppers Drug Mart and Rexall are vigorously protesting this move. Their claim is that these discounts are necessary to make their businesses economically viable and that without the discounts they will have to cut services, close stores earlier and/or start charging for services that have been provided for free up until now such as home delivery.
Few people seem to have much sympathy for the large chains but the smaller independent stores are in a different situation. The large chains have become like supermarkets selling everything from books to telephones to cameras to groceries. Filling prescriptions is only a relatively small part of their business. However, typically the small independent stores focus on filling prescriptions and selling over-the-counter drugs and other drug related consumer products such as suntan lotion, toothpaste and the like. Losing the discounts could have serious consequences for them and for their patients especially if these stores are located in rural communities.
The government is not completely indifferent to what pharmacists are saying and has announced some relief for them. Dispensing fees for pharmacists in rural communities will go up $3 and in urban centres they will go up $1 amounting to about $100-million in total. The message from the groups speaking on behalf of pharmacies is that this is too little.
The dispensing fee is the payment that the government makes for the advice that pharmacists provide for their patients. Up until now the government has largely frozen the dispensing fee at its current level of under $7 for years. Dispensing fees for people paying out-of-pocket and for those with private drug insurance have not been regulated so by freezing public dispensing fees the government has in effect shifted that cost onto these two groups. This is especially troublesome for those without insurance who pay out-of-pocket since they tend to work at low wage non-unionized jobs and being at the lower end of the socioeconomic scale have more health problems and need more drugs. Freezing dispensing fees has also forced pharmacies owners to become more and more reliant on the discounts that they receive from the generic companies, the very thing that the government is now complaining about.
The Way Forward: Alternatives Not Considered
Part of the solution is to stop paying pharmacists for being storekeepers and start paying them for the knowledge that they gained from going to university for four years. Pharmacists have been trained to know about drugs and government should pay them to monitor patients for adverse effects from medications, to go over the drug regimens that people are on, particularly people in high risk groups such as the elderly and children, to spend time discussing the harms and benefits of drugs that people are taking. As provinces reform primary care they should be looking to move many pharmacists out of stores altogether and putting them down the hall from doctors. When the doctors write a prescription people can easily go to a pharmacist who has the time to spend with them and the knowledge to properly advice them.
There is little doubt that generic drug prices in Canada are significantly higher than in many other countries and lowering these prices makes sense. However, if governments want to go where the savings really are then they need to start taking aggressive action on brand-name prices. The average cost of a generic prescription in 2008 was $26 versus $66.50 for a brand-name drug. Of the $20-billion in revenue drug manufacturers receive, 70% goes to brand name drugs and only 30% to generic drugs. In 2007/08 two brand name drugs alone accounted for 10% of the total cost of Ontario’s drug plan.
Before looking at how high prices might be tackled it is worth briefly examining why prices are high in the first place. Drug companies claim that these prices are necessary so that they can recoup their investment in research and development and continue to develop new and better medications. At present the companies are touting a figure of at least $1-billion (U.S.) as what is needed to bring a new drug to market. However this number is heavily contested since it relies on an analysis of confidential data from companies reported to a research centre that gets 40% of its income in the form of unrestricted grants from multinational drug companies. Moreover, the $1-billion figure ignores the indirect subsidies that companies get through tax deductions on research spending. The only attempt to engage in an independent examination of industry information came during the 1970s and early 1980s when the General Accounting Office (GAO), the investigative arm of the U.S. Congress, sought financial data that would allow it to estimate research, development, marketing, promotion, and distribution costs for individual products. The drug companies objected on the grounds that the confidentiality of their cost and other data could not be protected. Ultimately the dispute went to the U.S. Supreme Court that ruled that the GAO was not authorized to collect this type of information.
On top of the question of how much money the industry spends on research and development is the actual value of the drugs that are marketed. Evidence from Canada and France indicates that at best about 15% of new drugs represent any significant therapeutic advantage over what already exists. While these drugs may be worth the prices that are being asked, the other 85% represent gravy for the industry and little to nothing for the public that takes them.
One way of bringing down prices is to use monopsony buying power, but right now Canada has 10 provincial, three territorial and four federal drug plans and no universal coverage. In contrast in Australia the national government covers all residents in the country for drug costs and is the only bargaining agent. As a result, brand name drug prices are about 9% lower in Australia than they are here. Having a single payer and extending public coverage to the entire population would put the government in a much stronger position vis-à-vis the drug companies.
One of the reasons why doctors switch from older, less expensive generic drugs to newer, more expensive but not necessarily any better or safer brand name drugs is the massive promotional campaigns that drug companies put on. In the year after the anti-inflammatory and analgesic Vioxx was launched Merck took out over 1000 pages of advertising in Canadian medical journals, company representatives paid 48,000 visits to the offices of Canadian doctors and left behind over 1,000,000 samples. (Less than five years later Vioxx was pulled from the market for safety reasons – a cautionary note about using new drugs.) The estimate is that companies spend between $2.4 and $4.8-billion annually here in pushing their drugs to doctors. While the Food and Drugs Act gives the federal government the power to regulate promotion it has consistently refused to exercise that power except on very rare occasions and has turned over the control of promotion to the drug companies. The results are not unexpected – a weak code of conduct enforced through a passive complaints mechanism with fines for violations that amount to little more than lunch money for the drug companies.
Back in the early 1990s, the government of New Zealand was looking at rapidly escalating drug costs. Its response was to create an agency, Pharmac, to manage the national drug budget. According to projections without Pharmac by 2009 the country would have been paying $1.6-billion per year, with Pharmac it was actually paying about $670-million. Steve Morgan, a health economist at the University of British Columbia, has estimated that if Canada adopted the tactics used in New Zealand, depending on what groups of drugs we are looking at, Canada could save 21% to 79% off what is currently spent. New Zealand is willing to play hardball with the drug companies. If companies want to list a new drug on New Zealand’s formulary then they typically have to cut prices on drugs already listed. New Zealand aggressively uses reference-based pricing. Under this system where there are groups of drugs that experts judge are basically the same in terms of safety and effectiveness the government only pays for the least expensive drug in the class. British Columbia uses such a system for five groups of drugs and saves money without putting patients at risk. However, no new drug groups have been added since the NDP lost power in 2001 and no other province in Canada uses the system.
If the real savings are in lowering brand name drug costs why has the Ontario government chosen to take on the pharmacy owners? The answer lies in the power of the multinational drug companies. The pharmacy owners have relatively few allies. The multinational drug companies would not only complain to the provincial government they would also complain to Washington and the European countries where they are based and where they contribute substantially to the economy. Canada has already lost a couple of complaints about drug prices at the World Trade Organization and is unlikely to relish the thought of taking on another challenge.
Bringing down generic prices is only a small part of controlling drug spending in Ontario and the rest of Canada.
Joel Lexchin teaches health policy at York University and works in the emergency department at the University Health Network.
Source: Global Research CA
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Seeking Funds to Fight Neglected Diseases
By Fabiana Frayssinet
RIO DE JANEIRO, Mar 31, 2010 (IPS) - Experts from around the world are trying to attract attention to deadly but little-known illnesses, such as Chagas disease, visceral leishmaniasis and sleeping sickness, that have been neglected by the pharmaceutical industry.
So-called neglected tropical diseases, which also include malaria, dengue fever and schistosomiasis, in conjunction with tuberculosis are responsible for 11.4 percent of the global burden of illness, but only 1.3 percent of the 1,556 new drugs registered between 1975 and 2004 were specifically developed for these diseases.
Pharmaceutical laboratories give these diseases "zero priority," Tania Araújo-Jorge, head of the state Oswaldo Cruz Foundation (FIOCRUZ), told IPS.
The Brazilian Foundation hosted a Monday through Wednesday meeting of experts and health managers from all over the world in Rio de Janeiro.
The World Health Organisation (WHO) sponsored the meeting in order to channel resources and formulate strategies for studies leading to treatment for the diseases.
"Private companies do not invest in research on these diseases because they are not profitable, there is no market (for drugs)," said Araújo-Jorge. The governments of countries where the diseases are endemic are a potential market, but "they have no policies to guarantee purchases," and therefore do not help attract investment, she added.
According to the Drugs for Neglected Diseases Initiative (DNDi), originated by Doctors Without Borders/Médécins Sans Frontières, these diseases kill or disable millions of people who represent a huge unaddressed medical need.
Indeed, one of the aims of the meeting, co-organised with the Oswaldo Cruz Institute and the Pan-American Health Organisation, was to discuss how to fill this gap in public health provision.
"At present there are greater opportunities to obtain funds from companies and foundations, but the priorities have yet to be defined. Financing is being dispersed among a number of different research studies," Araújo-Jorge said.
The results of meetings like this one will provide the basis for drawing up a global report in 2011 to provide guidance for the concerned agencies and countries.
"The goal is to harmonise and streamline financing efforts by deciding on priorities," she said.
The meeting focused on the most neglected of the tropical diseases: Chagas disease, sleeping sickness and visceral leishmaniasis, all of which are caused by parasites and affect over 500 million people.
In an interview with IPS, Isabela Ribeiro, the coordinator of DNDi projects in Latin America, emphasised that these diseases represent an enormous social and economic burden in terms of public health.
Ribeiro talked about Chagas disease, caused by the parasite Trypanosoma cruzi, which is transmitted to humans by a blood-sucking insect regionally known as the "vinchuca" bug.
Chagas disease affects about eight million people worldwide, and is endemic in 21 Latin American countries. It frequently goes undiagnosed, and serious cases result in cardiopathy and digestive problems, causing disability with a high social and economic impact that is "often unrecognised," she said.
The DNDi programme lists unemployment and "loss of years of productive life" among its consequences.
Another study cited by DNDi, carried out in Brazil between 1979 and 1981, found that over a period of 15 years, more than 1.3 billion dollars were lost in wages and industrial productivity by workers with Chagas disease in this South American giant.
Sleeping sickness, caused by two sub-species of protozoa that are transmitted to humans by the tse-tse fly, affects between 50,000 and 70,000 people a year and causes 48,000 deaths a year.
It mainly affects African countries, and according to DNDi has a serious social and economic impact. Epidemics of sleeping sickness affect up to 50 percent of the population of some rural villages in Africa.
Visceral leishmaniasis is also linked to poverty. At present, the most serious form of the disease affects 500,000 people in 88 countries, the worst-hit of which are Bangladesh, Brazil, Ethiopia, India, Kenya, Nepal and Sudan.
These diseases have "different levels of mortality and morbidity," but they all have "large potential social and economic impacts," Ribeiro said.
Associated as they are with the "most vulnerable populations, that are generally outside the system," they do not generate much interest in terms of research or drug development, she said.
In spite of the overall scenario, Ribeiro is optimistic. She emphasised the increasing emergence of "partnership models" between the public and private sectors to develop treatment drugs, promoted by organisations like DNDi.
In Brazil, for instance, the state laboratory Farmanguinhos, belonging to FIOCRUZ, is developing drugs to treat diseases like malaria, and promoting specific research studies on Chagas disease.
In the private sector, meanwhile, a partnership with multinational pharmaceutical laboratory Sanofi-Aventis is making an anti-malarial drug which will be available at cost price to the public health sector, Ribeiro said.
Another hopeful sign, according to Araújo-Jorge, is the fact that international organisations have begun to give "more say, and a greater leadership role" to countries where these diseases are endemic.
The fact that a country like Brazil was chosen to host this international meeting of experts is a sign that "the debate is being decentralised" and is occurring "outside of Geneva," where the WHO is based, she said.
SOURCE IPS NEWS
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Scientist `deceived' by drugs giant
By Richard Guilliatt
A LEADING Australian medical researcher says the pharmaceutical giant Wyeth duped him into publishing a scientific paper that became part of the company's clandestine campaign to play down the dangers of its drugs for menopausal women.
John Eden, an associate professor at the University of NSW and director of the Sydney Menopause Centre, says he has been shocked to learn that a paper he published in the prestigious American Journal of Obstetrics and Gynecology was one of more than 40 scientific articles Wyeth orchestrated to try to increase sales of its lucrative hormone-replacement drugs.
Dr Eden was last month cleared of an allegation that "ghostwriters" employed by Wyeth wrote his article but he acknowledges that internal drug company documents obtained by The Weekend Australian show the company misled him about its real agenda and its behind-the-scenes role in his paper.
"I was deceived," he said, adding that his trust in the drug industry had been shaken.
Dr Eden's denunciation of Wyeth goes to the heart of an unfolding medical controversy -- how hugely profitable pharmaceutical companies promote their drugs by covertly paying for ghostwritten or favourable research articles.
In December 2008, the US Senate finance committee announced it was investigating whether a large number of prominent menopause researchers -- among them Dr Eden -- had put their names to ghostwritten scientific articles devised and paid for by Wyeth. At the time, Dr Eden refused to comment other than saying he stood by his article, which was published in the American Journal of Obstetrics and Gynecology in 2003 under the title Progestins and Breast Cancer'.
But since late last year the controversy has widened with the release of hundreds of internal Wyeth documents previously kept under seal in US courts.
The documents reveal that Wyeth paid a US "medical communications" company called DesignWrite to produce more than 40 scientific papers on hormone-replacement drugs between 1997 and 2005, a period when evidence was emerging that the drugs significantly increased a woman's risk of breast cancer, heart attack and stroke.
Wyeth's menopause drugs were once the biggest-selling pharmaceuticals in the US, grossing $US2 billion a year.
Speaking in detail about the controversy for the first time, Dr Eden acknowledged that Wyeth suggested he write the article after inviting him to a company-sponsored symposium in New York in June 2000. Wyeth was at the time preparing to launch a new pill containing the hormone progestin, and Dr Eden's research indicated progestin in high doses was beneficial to women with breast cancer.
The documents show that a Wyeth marketing executive had offered Dr Eden the assistance of "knowledgeable and gifted writers" who could help turn his research into a published paper.
Wyeth came up with the title of the paper and DesignWrite paid a freelance science writer $US3000 to draft an 11-page "outline" which was sent to Dr Eden after being scrutinised by Wyeth's marketing department.
Dr Eden acknowledges he received editorial assistance in drafting and revising the paper but denies it was ghostwritten.
He says the paper was based on his research and was controlled by him without any influence or payment to him from Wyeth.
But he says he is angry and offended to discover that Wyeth had a hidden commercial agenda and was scrutinising the article behind his back.
"If I had any idea, I would have said forget it," he says.
Dr Eden's published paper failed to acknowledge Wyeth's assistance, which he admits was a "mistake".
The American Journal of Obstetrics and Gynecology launched an investigation into the Eden paper after it was named in the US Senate investigation. Two weeks ago, the journal informed Dr Eden it was satisfied the paper was not ghostwritten and said no further action would be taken.
A spokesman for Pfizer, which acquired Wyeth last year for $US68bn, denied that the articles Wyeth sponsored were ghostwritten, saying the authors had full control of their content.
At least one of the named authors, however, has admitted his paper was written for him.
Leon Speroff emailed DesignWrite to congratulate it on its "super job" of writing his paper, and says he sees nothing wrong with the practice.
SOURCE LALEVA.ORG
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When drug makers' profits outweigh penalties
By David Evans
Bloomberg News
Sunday, March 21, 2010; G01
Prosecutor Michael Loucks remembers clearly when attorneys for Pfizer, the world's largest drug company, looked across the table and promised it wouldn't break the law again. It was January 2004, and the lawyers were
negotiating in a conference room on the ninth floor of the federal courthouse in Boston, where Loucks was head of the health-care fraud unit of the U.S. Attorney's Office. One of Pfizer's units had been pushing doctors
to prescribe an epilepsy drug called Neurontin for uses the Food and Drug Administration had never approved. In the agreement the lawyers eventually hammered out, the Pfizer unit, Warner-Lambert, pleaded guilty to two felony counts of marketing a drug for unapproved uses. New York-based Pfizer agreed to pay $430 million in criminal fines and civil penalties, and the company's lawyers assured Loucks and three other prosecutors that Pfizer and its units would stop promoting drugs for unauthorized purposes. What Loucks, who was
acting U.S. attorney in Boston until November, didn't know until years later was that Pfizer managers were breaking that pledge not to practice off-label marketing even before the ink was dry on their plea.
On the morning of Sept. 2, 2009, another Pfizer unit, Pharmacia & Upjohn, agreed to plead guilty to the same crime. This time, Pfizer executives had been instructing more than 100 salespeople to promote Bextra -- a drug
approved only for the relief of arthritis and menstrual discomfort -- for treatment of acute pain of all kinds.
For this new felony, Pfizer paid the largest criminal fine in U.S. history: $1.19 billion. On the same day, it paid $1 billion to settle civil cases involving the off-label promotion of Bextra and three other drugs with the
United States and 49 states. "At the very same time Pfizer was in our office negotiating and resolving
the allegations of criminal conduct in 2004, Pfizer was itself in its other operations violating those very same laws," Loucks, 54, says. "They've repeatedly marketed drugs for things they knew they couldn't demonstrate
efficacy for. That's clearly criminal." The penalties Pfizer paid for promoting Bextra off-label were the latest
chapter in the drug's benighted history. The FDA found Bextra to be so dangerous that Pfizer took it off the market for all uses in 2005. Across the United States, pharmaceutical companies have pleaded guilty to
criminal charges or paid penalties in civil cases when the Justice Department finds that they deceptively marketed drugs for unapproved uses, putting millions of people at risk of chest infections, heart attacks,
suicidal impulses or death. It used to be legal for companies to promote drugs in the United States for
any use. Congress banned the practice in 1962, requiring pharmaceutical companies to first prove their drugs were safe and effective for specific uses.
If the law is clear, why do drug companies keep breaking it? The answer lies in economics. Pharmaceutical companies spend about $1 billion to develop and test a new drug. To recoup their investment, the companies want doctors to prescribe their drugs as widely as possible. Since May 2004, Pfizer, Eli Lilly, Bristol-Myers Squibb and four other drug companies have paid a total of $7 billion in fines and penalties. Six of the companies admitted in court that they marketed medicines for unapproved uses. In September 2007, New York-based Bristol-Myers paid $515 million --without admitting or denying wrongdoing -- to federal and state governments
in a civil lawsuit brought by the Justice Department. The six other companies pleaded guilty in criminal cases.
In January 2009, Indianapolis- based Lilly, the largest U.S. psychiatric drugmaker, pleaded guilty and paid $1.42 billion in fines and penalties to settle charges that it had for at least four years illegally marketed
Zyprexa, a drug approved for the treatment of schizophrenia, as a remedy for
dementia in elderly patients. In five company-sponsored clinical trials, 31 people out of 1,184 participants died after taking the drug for dementia -- twice the death rate for those taking a placebo, according to an article in the Journal of the American Medical Association. "Marketing departments of many drug companies don't respect any boundaries of professionalism or the law," says Jerry Avorn, a professor at Harvard Medical School. "The Pfizer and Lilly cases involved the illegal promotion of drugs that have been shown to cause substantial harm and death to patients."
The widespread off-label promotion of drugs is yet another manifestation of a health-care system that has become dysfunctional. "It's an unbearable cost to a system that's going broke," Avorn says. "We
can't even afford to pay for effective, safe therapies." About 15 percent of all U.S. drug sales are for unapproved uses without adequate evidence the medicines work, according to a study by Randall Stafford, a medical professor at Stanford University. As large as the penalties are for drug companies caught breaking the
off-label law, the fines are tiny compared with the firms' annual revenue. The $2.3 billion in fines and penalties Pfizer paid for marketing Bextra and three other drugs cited in the Sept. 2 plea agreement for off-label uses
amount to just 14 percent of its $16.8 billion in revenue from selling those medicines from 2001 to 2008.
The total of $2.75 billion Pfizer has paid in off-label penalties since 2004 is a little more than 1 percent of the company's revenue of $245 billion from 2004 to 2008. Lilly already had a criminal conviction for misbranding a drug when it broke the law again in promoting schizophrenia drug Zyprexa for off-label uses beginning in 1999. The medication provided Lilly with $36 billion in revenue from 2000 to 2008. That's more than 25 times as much as the total penalties Lilly paid in January. Companies regard the risk of multimillion- dollar penalties as just another
cost of doing business, says Lon Schneider, a professor at the University of Southern California's Keck School of Medicine in Los Angeles. In 2006, he led a study for the National Institute of Mental Health of off-label use of
drugs, including Zyprexa. "There's an unwritten business plan," he says. "They're drivers that knowingly speed. If stopped, they pay the fine, and then they do it again."
Paying the doctors
In pushing off-label use of drugs, companies find ready and willing partners in physicians. Under the fragmented system of U.S. medical regulation, it's legal for doctors to prescribe FDA-approved drugs for any use. The FDA has no authority over doctors, only over drug companies, regarding off-label practices. It's up to the states to oversee physicians.
"I think the physician community has to take some ownership responsibility and do their own due diligence beyond the sales and marketing person," says Boston's former U.S. Attorney Michael Sullivan. Doctors generally don't tell people they're prescribing drugs pitched to them by pharmaceutical salespeople for unapproved treatments, says Peter Lurie, former deputy medical director of Public Citizen, a Washington-based
public interest group. Most doctors don't keep track of FDA-approved uses of drugs, he says.
"The great majority of doctors have no idea; they don't even understand the distinction between on- and off-labeling, " he says.Pfizer's marketing program offered doctors up to $1,000 a day to allow a
Pfizer salesperson to spend time with the physician and his patients, according to a whistle-blower lawsuit filed by John Kopchinski, who worked as a salesman at Pfizer from 1992 to 2003. "By 'pairing up' with a physician, the sales representative was able to promote over a period of many hours, without the usual problems of gaining
access to prescribing physicians," Kopchinski says. "In essence, this amounted to Pfizer buying access to physicians." Pfizer spokesman Chris Loder says the company stopped what it calls "mentorships" in 2005. He says Pfizer paid doctors $250 a visit. The goal was clear: Get doctors to prescribe a new drug as widely as possible.
Pfizer's Neurontin is a case in point. The FDA approved the drug as a supplemental medication to treat epilepsy in 1993. Pfizer took in $2.27 billion from sales of Neurontin in 2002. A full 94 percent -- $2.12 billion -- of that revenue came from off-label use, according to the prosecutors' 2004 Pfizer sentencing memo.
Since 2004, companies that are now Pfizer divisions have pleaded guilty to off-label marketing of two drugs. Pfizer continued off-label promotions for these medications after buying the firms, according to documents.
Pfizer first stepped into an off-label scheme in 1999, when it offered to buy Warner-Lambert, based in New Jersey. Prosecutors charged that Warner-Lambert marketed Neurontin off-label between 1995 and 1999.
Warner-Lambert admitted doing so for one year in a May 2004 guilty plea for which Pfizer paid $430 million in fines and penalties. When the FDA approved Neurontin in 1993 to be used only along with other
epilepsy drugs, the agency wrote that as a side effect, the drug can induce depression and suicidal thoughts in patients.
The whistle-blower
Much of what prosecutors learned about Warner-Lambert' s marketing of Neurontin comes from a former employee, David Franklin, who holds a Ph.D. in microbiology. Franklin, 48, whose title at Warner-Lambert was medical liaison, says his job involved more salesmanship than science. He told doctors that Neurontin
was the best drug for a dozen off-label uses, including pain relief, bipolar disease and depression.
"Technically, I had responsibility for answering physician questions about all of Parke-Davis' s drugs," Franklin says. "In practice, my real job was to promote Neurontin for off-label indications heavily -- to the exclusion of
just about everything else." Franklin says he knew such uses of the drug had no scientific support for
effectiveness and safety. "I was actually undermining their ability to fulfill the Hippocratic oath,"
Franklin says, referring to a physician's pledge to "First, do no harm." After working for Warner-Lambert for three months, Franklin quit and filed a whistle-blower lawsuit on behalf of taxpayers to recover money the
government paid for illegally promoted drugs. He stood to collect as much as 30 percent of any settlement the company made with the government. Franklin had to wait four years -- until 2000 -- before the Justice
Department began a criminal investigation. In November 1999, Pfizer made its public offer to buy Warner-Lambert. In January 2000, a federal grand jury in Boston issued subpoenas to Warner-Lambert employees to testify about the marketing of Neurontin. That March, Warner-Lambert' s annual report disclosed that prosecutors were building a criminal case. Undeterred, Pfizer bought Warner-Lambert in June
for $87 billion -- the third-largest merger in U.S. history.
More sales than Viagra
A year after the acquisition, the FDA discovered that Neurontin was still being marketed off-label. In a June, 2001 letter to the company, the agency wrote that Pfizer's promotion of the drug "is misleading and in violation of the Federal Food, Drug and Cosmetics Act."
Pfizer marketed Neurontin off-label after receiving that letter, agency records show. For 2001, Pfizer reported revenue of $1.75 billion from Neurontin sales, making it the company's fourth-largest- selling drug that
year, ahead of impotence pill Viagra, which Neurontin topped for four years. As Neurontin sales soared to $2.27 billion in 2002, the FDA found that Pfizer was improperly claiming that the drug was useful for a broader range
of brain disorders than scientific evidence had established. The agency sent a letter dated July 1, 2002, that said the company's marketing practices were in violation of FDA rules. It asked Pfizer to stop
using misleading promotions. Pfizer reported $2.7 billion in revenue from Neurontin in 2003. Overall, the drug has provided Pfizer with $12 billion in revenue. Pfizer spokesman Chris Loder says, "Regarding the 2001 and 2002 FDA letters, we do not believe that they were suggestive of any continuing off-label promotion."
For blowing the whistle on his employer, Franklin collected $24.6 million under the False Claims Act.
Prosecutors Loucks and Sullivan got involved in the case after Franklin filed his suit, relying on information from Franklin and their own investigation. Before 2004, prosecutions for off-label marketing were rare.
"Until a couple of these cases became public, companies were probably saying, 'Everybody does it this way,' " Sullivan says. Loucks had a track record in off-label prosecutions. In 1994, he negotiated a $61 million settlement with C.R. Bard of New Jersey, which pleaded guilty to promoting off-label use of a heart catheter that led to patient deaths.
The off-label campaign
In the January 2004 settlement negotiations with Loucks, Sullivan and two other prosecutors, Pfizer's lawyers assured the U.S. Attorney's Office that the company wouldn't market drugs off-label."They asserted that the company understood the rules and had taken steps to assure corporate compliance with the law," Loucks says. "We remember those promises."
What Pfizer's lawyers didn't tell the prosecutors was that Pfizer was at that moment running an off-label marketing promotion using more than 100 salespeople who were pitching Bextra, according to a Pfizer sales manager who pleaded guilty to misbranding a drug in March 2009.
Pharmacia & Upjohn developed Bextra, which was approved by the FDA in 2001 for only the treatment of arthritis and menstrual discomfort. P&U and Pfizer had by then crafted a joint marketing agreement to sell the
drug. In November 2001, Mary Holloway, a Pfizer Northeast regional manager, began illegally training and directing her sales team to market Bextra for the relief of acute pain, Holloway admitted in the plea.
On Dec. 4, 2001, Pfizer executives sent Holloway a copy of a nonpublic FDA letter to the company. The agency had denied Pfizer's application to market Bextra for acute pain. Clinical trials had shown Bextra could cause heart damage and death.
Pfizer bought Pharmacia & Upjohn in April 2003. From 2001 through 2003, P&U, first as an independent company and then as a unit of Pfizer, paid doctors more than $5 million in cash to lure them to resorts, where salespeople
illegally pitched off-label uses for Bextra, P&U admitted. In her guilty plea, Holloway said her team had solicited hospitals to create protocols to buy Bextra for the unapproved purpose of acute pain relief. Her
representatives didn't mention the increased risk of heart attacks in their marketing.
They told doctors that side effects were no worse than those of a sugar pill, Holloway said. In 2003, Holloway reported her unit's off-label promotions of Bextra up the corporate ladder at Pfizer, according to a presentencing memo to the judge written by Robert Ullmann, Holloway's attorney. Top managers didn't attempt
to halt the illegal conduct, the memo said.
By late 2004, Bextra reached blockbuster status, with annual sales of $1.29 billion. Holloway promoted Bextra until the FDA asked Pfizer in April 2005 to pull it from the market for all uses. The agency concluded that the drug increased the risk of heart attacks, chest infections and strokes in cardiac surgery patients. In June 2009,
Holloway, 47, was sentenced to two years on probation and fined $75,000. She didn't return phone calls seeking comment.
'We regret . . . '
By 2007, the criminal and civil cases against Pfizer, its employees and its subsidiaries had begun to mount. The tally of drugs cited by federal prosecutors for off-label promotion reached six by 2009. In April 2007, P&U
pleaded guilty to a felony charge of offering a $12 million kickback to a pharmacy benefit manager. Pfizer paid a criminal fine of $19.7 million. In September 2009, Pfizer agreed to pay $2.2 billion in fines and penalties.
P&U pleaded guilty to a felony charge of misbranding Bextra with the intent to defraud. After the settlement, Pfizer general counsel Amy Schulman said the company had learned its lesson. "We regret certain actions we've taken in the past," she said. "Corporate integrity is an absolute priority for Pfizer." One reason drug companies keep breaking the law may be because prosecutors and judges have been unwilling to use the ultimate sanction -- a felony conviction that would exclude a company from selling its drugs for reimbursement by state health programs and federal Medicare. At Pfizer's Pharmacia sentencing in October, U.S. District Court Judge Douglas Woodlock said companies don't appear to take the law seriously. "It has become something of a cost of doing business for some of these corporations, to shed their skin like certain animals and leave the skin and
move on," he said. As prosecutors continue to uncover patterns of deceit in off-label marketing, millions of patients across the nation remain in the dark. Doctors often choose the medications based on dishonest marketing by drug company salesmen. Loucks says that putting an end to the criminal off-label schemes will be
difficult. As drugmakers repeatedly plead guilty, they've shown they're willing to pay hundreds of millions of dollars in fines as a cost of generating billions in revenue. The best hope, Loucks says, is that drug companies actually honor the promises they keep making -- and keep breaking -- to obey the law of the land.
As much as $100 million for health-care fraud enforcement is tied up in the stalled reform legislation, according to Loucks. "It will be increasingly hard for the threat of exclusion to seem credible and thus serve as a deterrent to bad corporate behavior," he says, "unless Congress supports health-care fraud prosecutions with more money." A version of this story originally appeared in Bloomberg Markets Magazine. It was awarded a 2010 Society of American Business Editors and Writers award for enterprise reporting and general excellence.
Source: Washington Post
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The Other Drug War - the politics of big business
Big Pharma spends millions every year buying influence in Canberra. Adele Ferguson and Eric Johnston investigate the ruthless tactics, the money and the spindoctors behind the scenes.
When the healthcare giant Wyeth Australia wanted its arthritis drug Enbrel listed on the Pharmaceutical Benefits Scheme it hired the political lobby group Parker & Partners to wheel out sick kids in its meetings with politicians.
The image of arthritic 10-year-olds, together with the threat of a bleeding-heart media campaign, was so potent that Enbrel was rushed on to the PBS under the watch of the then federal health minister, Kay Patterson, at a cost of $100 million a year to Australian taxpayers.
SOURCE
SYDNEY MORNING HERALD
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By Catherine Larkin
June 18 (Bloomberg) -- Roche Holding AG, Johnson & Johnson and Biogen Idec Inc. are being urged by U.S. regulators to see if existing medicines may help neglected disorders, after an incentive program failed to spark research on new therapies.
The Food and Drug Administration published a list of 235 treatments today that may have benefit in rare disorders and already have marketing clearance for other uses. Identifying “low-hanging fruit” may compel large drugmakers to look beyond common ailments with guaranteed consumer demand, said Tim Cote, head of the agency’s Office of Orphan Product Development.
The list includes Roche’s hepatitis drug Pegasys, J&J’s leukemia medicine Leustatin and Biogen Idec’s multiple sclerosis drug Avonex. Regulators need new tactics since an experiment two years ago to give priority review vouchers in exchange for new drugs for tropical diseases drew only one participant.
“Large pharmaceutical companies are not as engaged as we’d like to see them be,” Cote said in a phone interview. “I myself have knocked on the doors of all the big boys.”
About 30 million Americans have one of 7,000 rare diseases, defined by the FDA as conditions affecting fewer than 200,000 people in the U.S. Medicines developed to treat these conditions are called orphan drugs, under rules that encourage their development.
2,150 Orphan Designations
More than 2,150 potential treatments have been identified since the 1983 Orphan Drug Act promised seven years of market exclusivity to any product approved for a rare disease. To date, only 358 are on the market, and most are made by small, specialized biotechnology companies.
“This is not something that companies are thinking about on a regular basis,” said Ira Loss of Washington Analysis, who has followed the FDA for more than three decades. “If things were better in terms of the general economy and the pipelines of these companies, where they had time to focus on this possibility, it might be a different story.”
The FDA’s list focuses on orphan designations that have been given to drugs whose approval in other uses suggests they’re not toxic, Cote said. Anyone can apply for orphan drug designation without the current manufacturer’s permission, according to Sandy Walsh, an FDA spokeswoman.
Roche’s Pegasys has orphan status for chronic myelogenous leukemia. Leustatin, made by New Brunswick, New Jersey-based J&J, is approved for hairy cell leukemia but has had orphan drug designation since 1990 for chronic lymphochytic leukemia and acute myeloid leukemia. Also on the list is Biogen’s top-selling MS drug Avonex, which has had orphan designation since 1991 as a treatment for cutaneous t-cell lymphoma.
Companies Respond
While Biogen initially pursued Avonex in “several indications” the Cambridge, Massachusetts-based drugmaker now has no plans to develop it for cutaneous t-cell lymphoma, said Kate Weiss, a company spokeswoman.
“While we’re certainly always open to looking at new indications for all of our drugs, we’re not pursuing that for that indication,” Weiss said today in a phone interview.
J&J decided not to further develop Leustatin in part because there are other drugs available for leukemia, Ernie Knewitz, a spokesman for the company, said today in a telephone interview. J&J is studying products for other types of neglected diseases including the areas of oncology, HIV and hepatitis C, Knewitz said.
Roche is no longer studying Pegasys in cancer, said Kristina Becker, a spokeswoman for the Basel, Switzerland-based company’s Genentech unit.
‘Long History’ of Development
“The company has pursued studies and applications for several orphan indications,” Becker said today in an e-mail. “We have a long history of developing new medicines for diseases where there are no existing therapies even if not many patients are affected.”
Companies may worry that increasing pressure to cut medical costs will limit their pricing power, making it harder to recoup the cost of their investment in research from the small number of patients taking a medicine, Cote said. Orphan drugs that have other uses may also still be victim to generic substitution, effectively limiting the promise of seven years of market exclusivity.
“The lack of research and lack of treatments is something we see every day,” said Mary Dunkle, a spokeswoman for the National Organization for Rare Disorders in Danbury, Connecticut. “It’s very frustrating for the families.”
The FDA tried a new strategy in 2008 by offering priority review vouchers for companies who win approval of drugs for one of 16 tropical diseases. The vouchers will shave four months off the regulatory review of any new product for which a company uses it. The vouchers also can be traded or sold.
Broadening Vouchers?
Novartis AG, of Basel, Switzerland, has so far won the only voucher -- for a 10-year-old malaria pill -- and hasn’t used it. Cote said he is considering broadening the list of conditions eligible for a voucher “within a couple months” to spark interest in the program.
Drugmakers are skeptical about vouchers, especially as an increasing number of drugs with priority review face delays, said Ramsey Baghdadi, a health-care analyst at Prevision Policy in Washington. He isn’t convinced that either initiative will be enough to encourage companies to invest in orphan-drug research they wouldn’t otherwise do.
“Nothing would hold a pharma company back from going after something if they really wanted to go after it,” Baghdadi said. “The real route is through patent extension or increased market exclusivity. People understand the value of that.”
The FDA will solicit feedback on how it approves and encourages medical products for rare diseases at a June 29-30 public hearing at its headquarters in Silver Spring, Maryland.
--Editors: Angela Zimm, Bruce Rule
To contact the reporter on this story: Catherine Larkin in Washington at [email protected].
Source:Bloomberg Business Week
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Canada's Big Pharma Drug War
by Dr. Joel Lexchin
The Ontario government has recently announced major changes to the way that it will pay for generic drugs for those covered under its public drug plan, primarily people 65 and over and those on social welfare. The aim is to rein in rapidly increasing costs for the Ontario Drug Benefit Program. Up until recently spending has been going up by more than 10% annually and overall across Canada drug costs are the second most expensive part of the health care system behind only hospitals.
The current government made a first attempt to deal with drug spending back in 2006 when it reduced the price for generic medicines from 70% of the brand name drug to 50%. At that time, $222-million in savings (from a drug bill of $3.5-billion) from reduced generic prices and other reforms was predicted. There was never any independent analysis about whether those anticipated savings were realized. Now faced with a deficit of over $20-billion and health care costs that take up 42 cents of every public dollar, the government is looking at a new initiative to rein in at least one segment of health care costs. The question of whether that 42-cent figure represents too much spending on health care or is mostly the product of a series of tax cuts that have reduced government revenue is a crucial issue that must be taken up soon.
The Politics of Generic Drugs
One of the key factors that makes public drug plans affordable is the existence of generic versions for many of the products that are on the provincial formulary. Generic drugs work the same as the original brand-name products but are much lower in cost since generic companies don't incur the research and development expenditures and also don't engage in costly promotion of their products.
However, in order for generic drugs to get used they need to be dispensed by pharmacists and this gives the pharmacy owners a huge stick in dealing with the generic companies. In effect what the pharmacy owners tell the generic companies is that they will not stock their products unless the companies sell to them at a discount. The pharmacy owners are reimbursed by the government at the list price of the medication not the discounted price. Therefore, the discount goes to the pharmacy owners not the government. These discounts amount to about 20% of the price of the drug.
What the government is now proposing to do is to eliminate these discounts, also referred to as professional allowances. Savings from making this change are projected by the government to amount to $750-million annually which would be a substantial reduction in the annual $4.14-billion that the government spends on prescription medications.
The pharmacy owners, primarily the large chains such as Shoppers Drug Mart and Rexall are vigorously protesting this move. Their claim is that these discounts are necessary to make their businesses economically viable and that without the discounts they will have to cut services, close stores earlier and/or start charging for services that have been provided for free up until now such as home delivery.
Few people seem to have much sympathy for the large chains but the smaller independent stores are in a different situation. The large chains have become like supermarkets selling everything from books to telephones to cameras to groceries. Filling prescriptions is only a relatively small part of their business. However, typically the small independent stores focus on filling prescriptions and selling over-the-counter drugs and other drug related consumer products such as suntan lotion, toothpaste and the like. Losing the discounts could have serious consequences for them and for their patients especially if these stores are located in rural communities.
The government is not completely indifferent to what pharmacists are saying and has announced some relief for them. Dispensing fees for pharmacists in rural communities will go up $3 and in urban centres they will go up $1 amounting to about $100-million in total. The message from the groups speaking on behalf of pharmacies is that this is too little.
The dispensing fee is the payment that the government makes for the advice that pharmacists provide for their patients. Up until now the government has largely frozen the dispensing fee at its current level of under $7 for years. Dispensing fees for people paying out-of-pocket and for those with private drug insurance have not been regulated so by freezing public dispensing fees the government has in effect shifted that cost onto these two groups. This is especially troublesome for those without insurance who pay out-of-pocket since they tend to work at low wage non-unionized jobs and being at the lower end of the socioeconomic scale have more health problems and need more drugs. Freezing dispensing fees has also forced pharmacies owners to become more and more reliant on the discounts that they receive from the generic companies, the very thing that the government is now complaining about.
The Way Forward: Alternatives Not Considered
Part of the solution is to stop paying pharmacists for being storekeepers and start paying them for the knowledge that they gained from going to university for four years. Pharmacists have been trained to know about drugs and government should pay them to monitor patients for adverse effects from medications, to go over the drug regimens that people are on, particularly people in high risk groups such as the elderly and children, to spend time discussing the harms and benefits of drugs that people are taking. As provinces reform primary care they should be looking to move many pharmacists out of stores altogether and putting them down the hall from doctors. When the doctors write a prescription people can easily go to a pharmacist who has the time to spend with them and the knowledge to properly advice them.
There is little doubt that generic drug prices in Canada are significantly higher than in many other countries and lowering these prices makes sense. However, if governments want to go where the savings really are then they need to start taking aggressive action on brand-name prices. The average cost of a generic prescription in 2008 was $26 versus $66.50 for a brand-name drug. Of the $20-billion in revenue drug manufacturers receive, 70% goes to brand name drugs and only 30% to generic drugs. In 2007/08 two brand name drugs alone accounted for 10% of the total cost of Ontario’s drug plan.
Before looking at how high prices might be tackled it is worth briefly examining why prices are high in the first place. Drug companies claim that these prices are necessary so that they can recoup their investment in research and development and continue to develop new and better medications. At present the companies are touting a figure of at least $1-billion (U.S.) as what is needed to bring a new drug to market. However this number is heavily contested since it relies on an analysis of confidential data from companies reported to a research centre that gets 40% of its income in the form of unrestricted grants from multinational drug companies. Moreover, the $1-billion figure ignores the indirect subsidies that companies get through tax deductions on research spending. The only attempt to engage in an independent examination of industry information came during the 1970s and early 1980s when the General Accounting Office (GAO), the investigative arm of the U.S. Congress, sought financial data that would allow it to estimate research, development, marketing, promotion, and distribution costs for individual products. The drug companies objected on the grounds that the confidentiality of their cost and other data could not be protected. Ultimately the dispute went to the U.S. Supreme Court that ruled that the GAO was not authorized to collect this type of information.
On top of the question of how much money the industry spends on research and development is the actual value of the drugs that are marketed. Evidence from Canada and France indicates that at best about 15% of new drugs represent any significant therapeutic advantage over what already exists. While these drugs may be worth the prices that are being asked, the other 85% represent gravy for the industry and little to nothing for the public that takes them.
One way of bringing down prices is to use monopsony buying power, but right now Canada has 10 provincial, three territorial and four federal drug plans and no universal coverage. In contrast in Australia the national government covers all residents in the country for drug costs and is the only bargaining agent. As a result, brand name drug prices are about 9% lower in Australia than they are here. Having a single payer and extending public coverage to the entire population would put the government in a much stronger position vis-à-vis the drug companies.
One of the reasons why doctors switch from older, less expensive generic drugs to newer, more expensive but not necessarily any better or safer brand name drugs is the massive promotional campaigns that drug companies put on. In the year after the anti-inflammatory and analgesic Vioxx was launched Merck took out over 1000 pages of advertising in Canadian medical journals, company representatives paid 48,000 visits to the offices of Canadian doctors and left behind over 1,000,000 samples. (Less than five years later Vioxx was pulled from the market for safety reasons – a cautionary note about using new drugs.) The estimate is that companies spend between $2.4 and $4.8-billion annually here in pushing their drugs to doctors. While the Food and Drugs Act gives the federal government the power to regulate promotion it has consistently refused to exercise that power except on very rare occasions and has turned over the control of promotion to the drug companies. The results are not unexpected – a weak code of conduct enforced through a passive complaints mechanism with fines for violations that amount to little more than lunch money for the drug companies.
Back in the early 1990s, the government of New Zealand was looking at rapidly escalating drug costs. Its response was to create an agency, Pharmac, to manage the national drug budget. According to projections without Pharmac by 2009 the country would have been paying $1.6-billion per year, with Pharmac it was actually paying about $670-million. Steve Morgan, a health economist at the University of British Columbia, has estimated that if Canada adopted the tactics used in New Zealand, depending on what groups of drugs we are looking at, Canada could save 21% to 79% off what is currently spent. New Zealand is willing to play hardball with the drug companies. If companies want to list a new drug on New Zealand’s formulary then they typically have to cut prices on drugs already listed. New Zealand aggressively uses reference-based pricing. Under this system where there are groups of drugs that experts judge are basically the same in terms of safety and effectiveness the government only pays for the least expensive drug in the class. British Columbia uses such a system for five groups of drugs and saves money without putting patients at risk. However, no new drug groups have been added since the NDP lost power in 2001 and no other province in Canada uses the system.
If the real savings are in lowering brand name drug costs why has the Ontario government chosen to take on the pharmacy owners? The answer lies in the power of the multinational drug companies. The pharmacy owners have relatively few allies. The multinational drug companies would not only complain to the provincial government they would also complain to Washington and the European countries where they are based and where they contribute substantially to the economy. Canada has already lost a couple of complaints about drug prices at the World Trade Organization and is unlikely to relish the thought of taking on another challenge.
Bringing down generic prices is only a small part of controlling drug spending in Ontario and the rest of Canada.
Joel Lexchin teaches health policy at York University and works in the emergency department at the University Health Network.
Source: Global Research CA
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Seeking Funds to Fight Neglected Diseases
By Fabiana Frayssinet
RIO DE JANEIRO, Mar 31, 2010 (IPS) - Experts from around the world are trying to attract attention to deadly but little-known illnesses, such as Chagas disease, visceral leishmaniasis and sleeping sickness, that have been neglected by the pharmaceutical industry.
So-called neglected tropical diseases, which also include malaria, dengue fever and schistosomiasis, in conjunction with tuberculosis are responsible for 11.4 percent of the global burden of illness, but only 1.3 percent of the 1,556 new drugs registered between 1975 and 2004 were specifically developed for these diseases.
Pharmaceutical laboratories give these diseases "zero priority," Tania Araújo-Jorge, head of the state Oswaldo Cruz Foundation (FIOCRUZ), told IPS.
The Brazilian Foundation hosted a Monday through Wednesday meeting of experts and health managers from all over the world in Rio de Janeiro.
The World Health Organisation (WHO) sponsored the meeting in order to channel resources and formulate strategies for studies leading to treatment for the diseases.
"Private companies do not invest in research on these diseases because they are not profitable, there is no market (for drugs)," said Araújo-Jorge. The governments of countries where the diseases are endemic are a potential market, but "they have no policies to guarantee purchases," and therefore do not help attract investment, she added.
According to the Drugs for Neglected Diseases Initiative (DNDi), originated by Doctors Without Borders/Médécins Sans Frontières, these diseases kill or disable millions of people who represent a huge unaddressed medical need.
Indeed, one of the aims of the meeting, co-organised with the Oswaldo Cruz Institute and the Pan-American Health Organisation, was to discuss how to fill this gap in public health provision.
"At present there are greater opportunities to obtain funds from companies and foundations, but the priorities have yet to be defined. Financing is being dispersed among a number of different research studies," Araújo-Jorge said.
The results of meetings like this one will provide the basis for drawing up a global report in 2011 to provide guidance for the concerned agencies and countries.
"The goal is to harmonise and streamline financing efforts by deciding on priorities," she said.
The meeting focused on the most neglected of the tropical diseases: Chagas disease, sleeping sickness and visceral leishmaniasis, all of which are caused by parasites and affect over 500 million people.
In an interview with IPS, Isabela Ribeiro, the coordinator of DNDi projects in Latin America, emphasised that these diseases represent an enormous social and economic burden in terms of public health.
Ribeiro talked about Chagas disease, caused by the parasite Trypanosoma cruzi, which is transmitted to humans by a blood-sucking insect regionally known as the "vinchuca" bug.
Chagas disease affects about eight million people worldwide, and is endemic in 21 Latin American countries. It frequently goes undiagnosed, and serious cases result in cardiopathy and digestive problems, causing disability with a high social and economic impact that is "often unrecognised," she said.
The DNDi programme lists unemployment and "loss of years of productive life" among its consequences.
Another study cited by DNDi, carried out in Brazil between 1979 and 1981, found that over a period of 15 years, more than 1.3 billion dollars were lost in wages and industrial productivity by workers with Chagas disease in this South American giant.
Sleeping sickness, caused by two sub-species of protozoa that are transmitted to humans by the tse-tse fly, affects between 50,000 and 70,000 people a year and causes 48,000 deaths a year.
It mainly affects African countries, and according to DNDi has a serious social and economic impact. Epidemics of sleeping sickness affect up to 50 percent of the population of some rural villages in Africa.
Visceral leishmaniasis is also linked to poverty. At present, the most serious form of the disease affects 500,000 people in 88 countries, the worst-hit of which are Bangladesh, Brazil, Ethiopia, India, Kenya, Nepal and Sudan.
These diseases have "different levels of mortality and morbidity," but they all have "large potential social and economic impacts," Ribeiro said.
Associated as they are with the "most vulnerable populations, that are generally outside the system," they do not generate much interest in terms of research or drug development, she said.
In spite of the overall scenario, Ribeiro is optimistic. She emphasised the increasing emergence of "partnership models" between the public and private sectors to develop treatment drugs, promoted by organisations like DNDi.
In Brazil, for instance, the state laboratory Farmanguinhos, belonging to FIOCRUZ, is developing drugs to treat diseases like malaria, and promoting specific research studies on Chagas disease.
In the private sector, meanwhile, a partnership with multinational pharmaceutical laboratory Sanofi-Aventis is making an anti-malarial drug which will be available at cost price to the public health sector, Ribeiro said.
Another hopeful sign, according to Araújo-Jorge, is the fact that international organisations have begun to give "more say, and a greater leadership role" to countries where these diseases are endemic.
The fact that a country like Brazil was chosen to host this international meeting of experts is a sign that "the debate is being decentralised" and is occurring "outside of Geneva," where the WHO is based, she said.
SOURCE IPS NEWS
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Scientist `deceived' by drugs giant
By Richard Guilliatt
A LEADING Australian medical researcher says the pharmaceutical giant Wyeth duped him into publishing a scientific paper that became part of the company's clandestine campaign to play down the dangers of its drugs for menopausal women.
John Eden, an associate professor at the University of NSW and director of the Sydney Menopause Centre, says he has been shocked to learn that a paper he published in the prestigious American Journal of Obstetrics and Gynecology was one of more than 40 scientific articles Wyeth orchestrated to try to increase sales of its lucrative hormone-replacement drugs.
Dr Eden was last month cleared of an allegation that "ghostwriters" employed by Wyeth wrote his article but he acknowledges that internal drug company documents obtained by The Weekend Australian show the company misled him about its real agenda and its behind-the-scenes role in his paper.
"I was deceived," he said, adding that his trust in the drug industry had been shaken.
Dr Eden's denunciation of Wyeth goes to the heart of an unfolding medical controversy -- how hugely profitable pharmaceutical companies promote their drugs by covertly paying for ghostwritten or favourable research articles.
In December 2008, the US Senate finance committee announced it was investigating whether a large number of prominent menopause researchers -- among them Dr Eden -- had put their names to ghostwritten scientific articles devised and paid for by Wyeth. At the time, Dr Eden refused to comment other than saying he stood by his article, which was published in the American Journal of Obstetrics and Gynecology in 2003 under the title Progestins and Breast Cancer'.
But since late last year the controversy has widened with the release of hundreds of internal Wyeth documents previously kept under seal in US courts.
The documents reveal that Wyeth paid a US "medical communications" company called DesignWrite to produce more than 40 scientific papers on hormone-replacement drugs between 1997 and 2005, a period when evidence was emerging that the drugs significantly increased a woman's risk of breast cancer, heart attack and stroke.
Wyeth's menopause drugs were once the biggest-selling pharmaceuticals in the US, grossing $US2 billion a year.
Speaking in detail about the controversy for the first time, Dr Eden acknowledged that Wyeth suggested he write the article after inviting him to a company-sponsored symposium in New York in June 2000. Wyeth was at the time preparing to launch a new pill containing the hormone progestin, and Dr Eden's research indicated progestin in high doses was beneficial to women with breast cancer.
The documents show that a Wyeth marketing executive had offered Dr Eden the assistance of "knowledgeable and gifted writers" who could help turn his research into a published paper.
Wyeth came up with the title of the paper and DesignWrite paid a freelance science writer $US3000 to draft an 11-page "outline" which was sent to Dr Eden after being scrutinised by Wyeth's marketing department.
Dr Eden acknowledges he received editorial assistance in drafting and revising the paper but denies it was ghostwritten.
He says the paper was based on his research and was controlled by him without any influence or payment to him from Wyeth.
But he says he is angry and offended to discover that Wyeth had a hidden commercial agenda and was scrutinising the article behind his back.
"If I had any idea, I would have said forget it," he says.
Dr Eden's published paper failed to acknowledge Wyeth's assistance, which he admits was a "mistake".
The American Journal of Obstetrics and Gynecology launched an investigation into the Eden paper after it was named in the US Senate investigation. Two weeks ago, the journal informed Dr Eden it was satisfied the paper was not ghostwritten and said no further action would be taken.
A spokesman for Pfizer, which acquired Wyeth last year for $US68bn, denied that the articles Wyeth sponsored were ghostwritten, saying the authors had full control of their content.
At least one of the named authors, however, has admitted his paper was written for him.
Leon Speroff emailed DesignWrite to congratulate it on its "super job" of writing his paper, and says he sees nothing wrong with the practice.
SOURCE LALEVA.ORG
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When drug makers' profits outweigh penalties
By David Evans
Bloomberg News
Sunday, March 21, 2010; G01
Prosecutor Michael Loucks remembers clearly when attorneys for Pfizer, the world's largest drug company, looked across the table and promised it wouldn't break the law again. It was January 2004, and the lawyers were
negotiating in a conference room on the ninth floor of the federal courthouse in Boston, where Loucks was head of the health-care fraud unit of the U.S. Attorney's Office. One of Pfizer's units had been pushing doctors
to prescribe an epilepsy drug called Neurontin for uses the Food and Drug Administration had never approved. In the agreement the lawyers eventually hammered out, the Pfizer unit, Warner-Lambert, pleaded guilty to two felony counts of marketing a drug for unapproved uses. New York-based Pfizer agreed to pay $430 million in criminal fines and civil penalties, and the company's lawyers assured Loucks and three other prosecutors that Pfizer and its units would stop promoting drugs for unauthorized purposes. What Loucks, who was
acting U.S. attorney in Boston until November, didn't know until years later was that Pfizer managers were breaking that pledge not to practice off-label marketing even before the ink was dry on their plea.
On the morning of Sept. 2, 2009, another Pfizer unit, Pharmacia & Upjohn, agreed to plead guilty to the same crime. This time, Pfizer executives had been instructing more than 100 salespeople to promote Bextra -- a drug
approved only for the relief of arthritis and menstrual discomfort -- for treatment of acute pain of all kinds.
For this new felony, Pfizer paid the largest criminal fine in U.S. history: $1.19 billion. On the same day, it paid $1 billion to settle civil cases involving the off-label promotion of Bextra and three other drugs with the
United States and 49 states. "At the very same time Pfizer was in our office negotiating and resolving
the allegations of criminal conduct in 2004, Pfizer was itself in its other operations violating those very same laws," Loucks, 54, says. "They've repeatedly marketed drugs for things they knew they couldn't demonstrate
efficacy for. That's clearly criminal." The penalties Pfizer paid for promoting Bextra off-label were the latest
chapter in the drug's benighted history. The FDA found Bextra to be so dangerous that Pfizer took it off the market for all uses in 2005. Across the United States, pharmaceutical companies have pleaded guilty to
criminal charges or paid penalties in civil cases when the Justice Department finds that they deceptively marketed drugs for unapproved uses, putting millions of people at risk of chest infections, heart attacks,
suicidal impulses or death. It used to be legal for companies to promote drugs in the United States for
any use. Congress banned the practice in 1962, requiring pharmaceutical companies to first prove their drugs were safe and effective for specific uses.
If the law is clear, why do drug companies keep breaking it? The answer lies in economics. Pharmaceutical companies spend about $1 billion to develop and test a new drug. To recoup their investment, the companies want doctors to prescribe their drugs as widely as possible. Since May 2004, Pfizer, Eli Lilly, Bristol-Myers Squibb and four other drug companies have paid a total of $7 billion in fines and penalties. Six of the companies admitted in court that they marketed medicines for unapproved uses. In September 2007, New York-based Bristol-Myers paid $515 million --without admitting or denying wrongdoing -- to federal and state governments
in a civil lawsuit brought by the Justice Department. The six other companies pleaded guilty in criminal cases.
In January 2009, Indianapolis- based Lilly, the largest U.S. psychiatric drugmaker, pleaded guilty and paid $1.42 billion in fines and penalties to settle charges that it had for at least four years illegally marketed
Zyprexa, a drug approved for the treatment of schizophrenia, as a remedy for
dementia in elderly patients. In five company-sponsored clinical trials, 31 people out of 1,184 participants died after taking the drug for dementia -- twice the death rate for those taking a placebo, according to an article in the Journal of the American Medical Association. "Marketing departments of many drug companies don't respect any boundaries of professionalism or the law," says Jerry Avorn, a professor at Harvard Medical School. "The Pfizer and Lilly cases involved the illegal promotion of drugs that have been shown to cause substantial harm and death to patients."
The widespread off-label promotion of drugs is yet another manifestation of a health-care system that has become dysfunctional. "It's an unbearable cost to a system that's going broke," Avorn says. "We
can't even afford to pay for effective, safe therapies." About 15 percent of all U.S. drug sales are for unapproved uses without adequate evidence the medicines work, according to a study by Randall Stafford, a medical professor at Stanford University. As large as the penalties are for drug companies caught breaking the
off-label law, the fines are tiny compared with the firms' annual revenue. The $2.3 billion in fines and penalties Pfizer paid for marketing Bextra and three other drugs cited in the Sept. 2 plea agreement for off-label uses
amount to just 14 percent of its $16.8 billion in revenue from selling those medicines from 2001 to 2008.
The total of $2.75 billion Pfizer has paid in off-label penalties since 2004 is a little more than 1 percent of the company's revenue of $245 billion from 2004 to 2008. Lilly already had a criminal conviction for misbranding a drug when it broke the law again in promoting schizophrenia drug Zyprexa for off-label uses beginning in 1999. The medication provided Lilly with $36 billion in revenue from 2000 to 2008. That's more than 25 times as much as the total penalties Lilly paid in January. Companies regard the risk of multimillion- dollar penalties as just another
cost of doing business, says Lon Schneider, a professor at the University of Southern California's Keck School of Medicine in Los Angeles. In 2006, he led a study for the National Institute of Mental Health of off-label use of
drugs, including Zyprexa. "There's an unwritten business plan," he says. "They're drivers that knowingly speed. If stopped, they pay the fine, and then they do it again."
Paying the doctors
In pushing off-label use of drugs, companies find ready and willing partners in physicians. Under the fragmented system of U.S. medical regulation, it's legal for doctors to prescribe FDA-approved drugs for any use. The FDA has no authority over doctors, only over drug companies, regarding off-label practices. It's up to the states to oversee physicians.
"I think the physician community has to take some ownership responsibility and do their own due diligence beyond the sales and marketing person," says Boston's former U.S. Attorney Michael Sullivan. Doctors generally don't tell people they're prescribing drugs pitched to them by pharmaceutical salespeople for unapproved treatments, says Peter Lurie, former deputy medical director of Public Citizen, a Washington-based
public interest group. Most doctors don't keep track of FDA-approved uses of drugs, he says.
"The great majority of doctors have no idea; they don't even understand the distinction between on- and off-labeling, " he says.Pfizer's marketing program offered doctors up to $1,000 a day to allow a
Pfizer salesperson to spend time with the physician and his patients, according to a whistle-blower lawsuit filed by John Kopchinski, who worked as a salesman at Pfizer from 1992 to 2003. "By 'pairing up' with a physician, the sales representative was able to promote over a period of many hours, without the usual problems of gaining
access to prescribing physicians," Kopchinski says. "In essence, this amounted to Pfizer buying access to physicians." Pfizer spokesman Chris Loder says the company stopped what it calls "mentorships" in 2005. He says Pfizer paid doctors $250 a visit. The goal was clear: Get doctors to prescribe a new drug as widely as possible.
Pfizer's Neurontin is a case in point. The FDA approved the drug as a supplemental medication to treat epilepsy in 1993. Pfizer took in $2.27 billion from sales of Neurontin in 2002. A full 94 percent -- $2.12 billion -- of that revenue came from off-label use, according to the prosecutors' 2004 Pfizer sentencing memo.
Since 2004, companies that are now Pfizer divisions have pleaded guilty to off-label marketing of two drugs. Pfizer continued off-label promotions for these medications after buying the firms, according to documents.
Pfizer first stepped into an off-label scheme in 1999, when it offered to buy Warner-Lambert, based in New Jersey. Prosecutors charged that Warner-Lambert marketed Neurontin off-label between 1995 and 1999.
Warner-Lambert admitted doing so for one year in a May 2004 guilty plea for which Pfizer paid $430 million in fines and penalties. When the FDA approved Neurontin in 1993 to be used only along with other
epilepsy drugs, the agency wrote that as a side effect, the drug can induce depression and suicidal thoughts in patients.
The whistle-blower
Much of what prosecutors learned about Warner-Lambert' s marketing of Neurontin comes from a former employee, David Franklin, who holds a Ph.D. in microbiology. Franklin, 48, whose title at Warner-Lambert was medical liaison, says his job involved more salesmanship than science. He told doctors that Neurontin
was the best drug for a dozen off-label uses, including pain relief, bipolar disease and depression.
"Technically, I had responsibility for answering physician questions about all of Parke-Davis' s drugs," Franklin says. "In practice, my real job was to promote Neurontin for off-label indications heavily -- to the exclusion of
just about everything else." Franklin says he knew such uses of the drug had no scientific support for
effectiveness and safety. "I was actually undermining their ability to fulfill the Hippocratic oath,"
Franklin says, referring to a physician's pledge to "First, do no harm." After working for Warner-Lambert for three months, Franklin quit and filed a whistle-blower lawsuit on behalf of taxpayers to recover money the
government paid for illegally promoted drugs. He stood to collect as much as 30 percent of any settlement the company made with the government. Franklin had to wait four years -- until 2000 -- before the Justice
Department began a criminal investigation. In November 1999, Pfizer made its public offer to buy Warner-Lambert. In January 2000, a federal grand jury in Boston issued subpoenas to Warner-Lambert employees to testify about the marketing of Neurontin. That March, Warner-Lambert' s annual report disclosed that prosecutors were building a criminal case. Undeterred, Pfizer bought Warner-Lambert in June
for $87 billion -- the third-largest merger in U.S. history.
More sales than Viagra
A year after the acquisition, the FDA discovered that Neurontin was still being marketed off-label. In a June, 2001 letter to the company, the agency wrote that Pfizer's promotion of the drug "is misleading and in violation of the Federal Food, Drug and Cosmetics Act."
Pfizer marketed Neurontin off-label after receiving that letter, agency records show. For 2001, Pfizer reported revenue of $1.75 billion from Neurontin sales, making it the company's fourth-largest- selling drug that
year, ahead of impotence pill Viagra, which Neurontin topped for four years. As Neurontin sales soared to $2.27 billion in 2002, the FDA found that Pfizer was improperly claiming that the drug was useful for a broader range
of brain disorders than scientific evidence had established. The agency sent a letter dated July 1, 2002, that said the company's marketing practices were in violation of FDA rules. It asked Pfizer to stop
using misleading promotions. Pfizer reported $2.7 billion in revenue from Neurontin in 2003. Overall, the drug has provided Pfizer with $12 billion in revenue. Pfizer spokesman Chris Loder says, "Regarding the 2001 and 2002 FDA letters, we do not believe that they were suggestive of any continuing off-label promotion."
For blowing the whistle on his employer, Franklin collected $24.6 million under the False Claims Act.
Prosecutors Loucks and Sullivan got involved in the case after Franklin filed his suit, relying on information from Franklin and their own investigation. Before 2004, prosecutions for off-label marketing were rare.
"Until a couple of these cases became public, companies were probably saying, 'Everybody does it this way,' " Sullivan says. Loucks had a track record in off-label prosecutions. In 1994, he negotiated a $61 million settlement with C.R. Bard of New Jersey, which pleaded guilty to promoting off-label use of a heart catheter that led to patient deaths.
The off-label campaign
In the January 2004 settlement negotiations with Loucks, Sullivan and two other prosecutors, Pfizer's lawyers assured the U.S. Attorney's Office that the company wouldn't market drugs off-label."They asserted that the company understood the rules and had taken steps to assure corporate compliance with the law," Loucks says. "We remember those promises."
What Pfizer's lawyers didn't tell the prosecutors was that Pfizer was at that moment running an off-label marketing promotion using more than 100 salespeople who were pitching Bextra, according to a Pfizer sales manager who pleaded guilty to misbranding a drug in March 2009.
Pharmacia & Upjohn developed Bextra, which was approved by the FDA in 2001 for only the treatment of arthritis and menstrual discomfort. P&U and Pfizer had by then crafted a joint marketing agreement to sell the
drug. In November 2001, Mary Holloway, a Pfizer Northeast regional manager, began illegally training and directing her sales team to market Bextra for the relief of acute pain, Holloway admitted in the plea.
On Dec. 4, 2001, Pfizer executives sent Holloway a copy of a nonpublic FDA letter to the company. The agency had denied Pfizer's application to market Bextra for acute pain. Clinical trials had shown Bextra could cause heart damage and death.
Pfizer bought Pharmacia & Upjohn in April 2003. From 2001 through 2003, P&U, first as an independent company and then as a unit of Pfizer, paid doctors more than $5 million in cash to lure them to resorts, where salespeople
illegally pitched off-label uses for Bextra, P&U admitted. In her guilty plea, Holloway said her team had solicited hospitals to create protocols to buy Bextra for the unapproved purpose of acute pain relief. Her
representatives didn't mention the increased risk of heart attacks in their marketing.
They told doctors that side effects were no worse than those of a sugar pill, Holloway said. In 2003, Holloway reported her unit's off-label promotions of Bextra up the corporate ladder at Pfizer, according to a presentencing memo to the judge written by Robert Ullmann, Holloway's attorney. Top managers didn't attempt
to halt the illegal conduct, the memo said.
By late 2004, Bextra reached blockbuster status, with annual sales of $1.29 billion. Holloway promoted Bextra until the FDA asked Pfizer in April 2005 to pull it from the market for all uses. The agency concluded that the drug increased the risk of heart attacks, chest infections and strokes in cardiac surgery patients. In June 2009,
Holloway, 47, was sentenced to two years on probation and fined $75,000. She didn't return phone calls seeking comment.
'We regret . . . '
By 2007, the criminal and civil cases against Pfizer, its employees and its subsidiaries had begun to mount. The tally of drugs cited by federal prosecutors for off-label promotion reached six by 2009. In April 2007, P&U
pleaded guilty to a felony charge of offering a $12 million kickback to a pharmacy benefit manager. Pfizer paid a criminal fine of $19.7 million. In September 2009, Pfizer agreed to pay $2.2 billion in fines and penalties.
P&U pleaded guilty to a felony charge of misbranding Bextra with the intent to defraud. After the settlement, Pfizer general counsel Amy Schulman said the company had learned its lesson. "We regret certain actions we've taken in the past," she said. "Corporate integrity is an absolute priority for Pfizer." One reason drug companies keep breaking the law may be because prosecutors and judges have been unwilling to use the ultimate sanction -- a felony conviction that would exclude a company from selling its drugs for reimbursement by state health programs and federal Medicare. At Pfizer's Pharmacia sentencing in October, U.S. District Court Judge Douglas Woodlock said companies don't appear to take the law seriously. "It has become something of a cost of doing business for some of these corporations, to shed their skin like certain animals and leave the skin and
move on," he said. As prosecutors continue to uncover patterns of deceit in off-label marketing, millions of patients across the nation remain in the dark. Doctors often choose the medications based on dishonest marketing by drug company salesmen. Loucks says that putting an end to the criminal off-label schemes will be
difficult. As drugmakers repeatedly plead guilty, they've shown they're willing to pay hundreds of millions of dollars in fines as a cost of generating billions in revenue. The best hope, Loucks says, is that drug companies actually honor the promises they keep making -- and keep breaking -- to obey the law of the land.
As much as $100 million for health-care fraud enforcement is tied up in the stalled reform legislation, according to Loucks. "It will be increasingly hard for the threat of exclusion to seem credible and thus serve as a deterrent to bad corporate behavior," he says, "unless Congress supports health-care fraud prosecutions with more money." A version of this story originally appeared in Bloomberg Markets Magazine. It was awarded a 2010 Society of American Business Editors and Writers award for enterprise reporting and general excellence.
Source: Washington Post
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The Other Drug War - the politics of big business
Big Pharma spends millions every year buying influence in Canberra. Adele Ferguson and Eric Johnston investigate the ruthless tactics, the money and the spindoctors behind the scenes.
When the healthcare giant Wyeth Australia wanted its arthritis drug Enbrel listed on the Pharmaceutical Benefits Scheme it hired the political lobby group Parker & Partners to wheel out sick kids in its meetings with politicians.
The image of arthritic 10-year-olds, together with the threat of a bleeding-heart media campaign, was so potent that Enbrel was rushed on to the PBS under the watch of the then federal health minister, Kay Patterson, at a cost of $100 million a year to Australian taxpayers.
SOURCE
SYDNEY MORNING HERALD
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