The Pervasiveness of Health Care Corruption as Shown by Another Roundup of Legal Settlements

Legal settlements are one way to document unethical and even corrupt behavior by large health care organizations, even if they may not deter bad behavior in the future.  It is time for another roundup of settlements by large pharmaceutical and device companies, presented in alphabetical order<br /><br /><b>Abbott Laboratories</b><br /><br />This one goes back to late December, 2013.  As <a href="http://www.chattanoogan.com/2013/12/27/266328/Abbott-Laboratories-To-Pay-5.475.aspx">described</a> in the Chattanoogan (from Tennessee):<br /><br /><blockquote class="tr_bq">Abbott Laboratories, a global healthcare company, has agreed to pay $5.475 million to settle alleged violations of the False Claims Act, and other federal laws and regulations in connection with the operation of its medical device business which manufactures, markets and supplies carotid, biliary, and peripheral vascular products.</blockquote><br />The US Justice Department accused Abbott of kickbacks to physicians,<br /><br /><blockquote class="tr_bq"> As alleged in the settlement agreement, between 2005 and 2010, through its employees and a third party continuing medical education providers, <i>Abbott offered physicians paid teaching and training assignments, consulting arrangements, speaking engagements, and/or sponsorship grants for physician conferences, for the purpose of inducing physicians to arrange for or recommend that the hospitals with which they were affiliated purchase or order Abbott’s carotid, biliary and peripheral vascular products.</i></blockquote><br />Note in particular that the kickbacks were disguised as payments for consulting or speaking. <br /><br />As is usual in such cases, no individual seems to have paid any penalty or been subject to any punishment.  Because this was a legal settlement, the company did not admit wrongdoing.<br /><br />Abbott's previous issues are discussed <a href="http://hcrenewal.blogspot.com/search/label/Abbott">here</a>, including a <a href="http://hcrenewal.blogspot.com/2012/05/abbott-pleads-guilty-settles-for-16.html">$1.6 billion settlement in 2012</a>.  <br /><br /><b>Baxter International</b><br /><br />This was <a href="http://www.modernhealthcare.com/article/20140421/INFO/304219992">reported</a> in April, 2014 by Modern Healthcare,<br /><br /><blockquote class="tr_bq"> Baxter International agreed to pay $64 million to settle a class-action lawsuit that alleged the Deerfield, Ill.-based company and some of its competitors <i>colluded to raise prices</i> of plasma-based therapies.</blockquote><br />Unlike the other cases above and below, this seemed to be a purely financial misadventure, although one that clearly increased health care costs,<br /><br /><blockquote class="tr_bq">Hospitals and drug distributors, saying they bought the plasma products at inflated prices, sued in 2009 Baxter; Victoria, Australia-based CSL; and the Plasma Protein Therapeutics Association, an Annapolis, Md.-based trade group.</blockquote><br />Once more, the company admitted no wrongdoing, and no individuals seemed to be subject to any negative consequences.   <br /><br />Baxter International's previous misadventures are <a href="http://hcrenewal.blogspot.com/search/label/Baxter">here</a>, including the <a href="http://hcrenewal.blogspot.com/2011/08/jama-article-begs-key-questions-about.html">striking case</a> of its marketing of contaminated and sometimes deadly heparin made from Chinese pigs.  <br /><br /><b>Endo Health Solutions</b><br /><br />This one is from February, 2014, as<a href="http://www.bloomberg.com/news/2014-02-21/endo-to-pay-193-million-in-lidoderm-marketing-probe.html"> reported</a> by Bloomberg<br /><br /><blockquote class="tr_bq">Endo Health Solutions entered a deferred-prosecution agreement and will pay $193 million to settle whistle-blower claims that it <i>marketed the shingles drug Lidoderm for unapproved purposes</i>, the U.S. said. <br />Endo will pay $20.8 million in forfeitures and $171.9 million in civil false claims settlements with the states and the U.S. government, the Justice Department said today in a statement. </blockquote><br />This one was all about marketing for uses not approved by the US Food an Drug Administration,<br /><br /><blockquote class="tr_bq">Between 2002 and 2006, Endo sales managers instructed some representatives on how to<i> expand 'sales conversations' with doctors beyond the treatment of shingles-related pain</i>, the U.S. said. Under the deferred-prosecution agreement, Endo admitted that it intended Lidoderm to be used for uses not approved by the U.S. Food and Drug Administration, the Justice Department said. </blockquote><br />Note that this case involves false claims, that is, fraud, because it is illegal to bill government programs for unapproved uses.<br /><br />Again, no individual suffered any consequences, and the company offered the usual kind of statement that admitted neither responsibility nor guilt,<br /><br /><blockquote class="tr_bq">'We are pleased to resolve this matter and are confident that we have robust programs in place to assist us in satisfying our legal and regulatory agreements,' Endo Chief Executive Officer Rajiv De Silva said in a statement.  </blockquote><br />One wonders, as usual, why a company would pay so much merely to avoid the legal expenses of a trial, unless of course the lawyers suspected the trail would not go well?<br /><br /><b>Hospira</b><br /><br />This one was about hiding quality problems due to cost-cutting from investors, as<a href="http://www.reuters.com/article/2014/03/27/hospira-lawsuit-idUSL1N0MO2BS20140327"> reported</a> by Reuters in March, 2014.   <br /><br /><blockquote class="tr_bq">Hospira Inc <span id="articleText"><span class="focusParagraph">has agreed to pay $60 million to resolve a class action lawsuit accusing the drug maker of misleading investors about <i>quality control problems that undermined an initiative to improve the company's margins and operations.</i></span></span></blockquote><br /><span id="articleText"><span class="focusParagraph">The details included,</span></span><br /><br /><blockquote class="tr_bq"><span id="articleText">As Hospira was promising to address issues raised by the U.S. Food and Drug Administration following inspections, the plaintiffs said the company was '<i>making the problems worse by gutting quality control efforts through cost cutting aimed at boosting short-term profitability</i>.'<br /><br /><span id="midArticle_7"></span>The lawsuit said those cost-cutting moves stemmed from a March 2009<i> initiative called 'Project Fuel' intended to increase shareholder value by eliminating underperforming and duplicative units and reducing its global workforce.</i><br /><br /><span id="midArticle_8"></span>Plaintiffs contended the <i>cuts in the budget and workforce hurt Hospira's quality control </i>efforts, particularly at Rocky Mount, the company's largest facility.<br /><br /><span id="midArticle_9"></span>An FDA inspection in January 2010 of the Rocky Mount facility found a number of <i>problems with the company's quality control and drug validation processes</i>, the lawsuit said, and the agency issued a warning letter that April.</span></blockquote><span id="articleText"></span><br /><br />Note that this involved quality control problems presumably in drug or device production, possibly leading to safety risks for patients.  Yet it was investors who brought the lawsuit.<br /><br />Note also that this seemed to be a clear case in which cost-cutting measures meant to improve short-term corporate revenue lead to problems that could have caused such risks.   <br /><br />One interesting feature of this case was that company executives were named as defendant (presumably again because it was investors, not patients or law-enforcement officials who initiated the suit.)<br /><br /><br /><blockquote class="tr_bq"><span id="articleText"><span id="articleText">The lawsuit ... also named executives including Chief Executive Officer Michael Ball as defendants,...</span></span></blockquote><span id="articleText"></span><br /><br /><span id="articleText">I cannot find any information about whether these executives were personally liable for any payments, however.   </span><br /><span id="articleText"><br /></span><b><span id="articleText">Pfizer</span></b><br /><span id="articleText"><br /></span><span id="articleText">This is yet another settlement involving the marketing of Neurontin, as <a href="http://www.bloomberg.com/news/2014-04-22/pfizer-agrees-to-pay-190-million-to-settle-neurontin-case-1-.html">reported</a> by Bloomberg in April, 2014,</span><br /><span id="articleText"><br /></span><br /><blockquote class="tr_bq"><span id="articleText"><span id="articleText">Pfizer Inc </span>the world’s biggest drugmaker, agreed to pay $190 million to end a lawsuit claiming it <i>violated federal antitrust laws by delaying generic versions of its Neurontin epilepsy drug. </i><br /></span></blockquote><blockquote>Pfizer agreed to settle the class-action litigation pending in federal court in Newark, New Jersey, according to a filing today. U.S. District Judge Faith Hochberg must approve the accord, which would cover purchasers of Neurontin from December 2002 to August 2008. </blockquote><br />Note that this settlement, like many others, is of matter from a long time ago.  When it comes to bad behavior by big health care corporations, any form of justice is not swift. <br /><br />Note also that this is only the latest chapter in the long saga of Neurontin, for whose mis-marketing Pfizer has already shelled out a lot of money (see<a href="http://hcrenewal.blogspot.com/2006/08/stealth-marketing-of-neurontin.html"> this post</a> to start, and <a href="http://hcrenewal.blogspot.com/search/label/Neurontin">here</a> for the collection).  Pfizer has an amazing record of bad behavior on view <a href="http://hcrenewal.blogspot.com/search/label/Pfizer">here</a>.  In fact, it has had a conviction as a Racketeering Influenced Corrupt Organization (RICO) on the basis of its previous marketing of Neurontin (look <a href="http://hcrenewal.blogspot.com/2013/12/blogscan-us-supreme-court-turns-down.html">here</a>). <br /><br />This particular bad behavior involved included,<br /><br /><blockquote class="tr_bq"> improperly listing certain patents with the U.S. Food and Drug Administration, engaging in <i>illegal promotion</i> and sales of Neurontin for unapproved uses, filing and maintaining sham litigations with respect to certain patents, and making misrepresentations to the patent courts,</blockquote><br />Note that while much of this was legalistic, illegal marketing was in there too.<br /><br />Once more, I found nothing about any negative consequences for individuals who authorized, directed, or implemented questionable actions.<br /><br /><b>Summary</b><br /><br />So it is all drearily familiar.  Big health care organizations seem to repeatedly engage in deceptive marketing, providing kickbacks to health professionals, fraudulent billing, anti-competitive practices, etc, etc.  These practices increase health care costs, and may risk patients' health and safety.  Many of these practices are corrupt, at least according to the Transparency International definition of corruption, "abuse of entrusted power for private gain."  Drug and device companies, for example, are entrusted to provide safe and effective products.  Deceptive marketing, kickbacks to health professionals to encourage overuse, and cutting quality control to cut costs all seem to be examples of abuse of this entrusted power.  The private gain obviously goes to any managers and executives who score bigger bonuses due to the increases in revenue that result.  <br /><br />Yet there are very few examples of any individuals who gained ever being subject to any negative consequences.  Given that lack, and the lack of any requirement for corporate leaders to admit responsibility, much less guilt, is it any surprise that these practices go on and on.  The failure of current limp legal efforts against such corruption is evident by how many corporations have become ethical repeat offenders.   (Note that in fact, as noted above, one of the pharmaceutical companies above actually was convicted of being a RICO, racketeering influenced corrupt organization, yet that conviction seemed to have no real negative consequences for the organization or any of the people involved.) <br /><br />As I have said again and again, pervasive bad behavior by large health care organizations has got to be a major cause of our ongoing health care dysfunction.<br /><br />So, to really deter bad behavior, those who authorized, directed or implemented bad behavior must be held accountable. As long as they are not, expect the bad behavior to continue. <br />

The Pervasiveness of Health Care Corruption as Shown by Another Roundup of Legal Settlements

Legal settlements are one way to document unethical and even corrupt behavior by large health care organizations, even if they may not deter...

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Another Month, Another Set of Legal Settlements, Deferred Prosecution Agreements, and Jury Findings Adverse to Large Health Care Corporations

Another month, another series of adverse legal rulings suggesting misbehavior by large health care organizations.  In alphabetical order,...<br /><br /><strong>Baxter, McKesson, Teva Pay Punitive Damages</strong><br /><br />As <a href="http://www.businessweek.com/news/2011-10-11/teva-jury-awards-162-5-million-in-damages-over-anesthetic.html">reported</a> by Bloomberg,<br /><blockquote>A jury said Teva Pharmaceutical Industries Ltd. unit and two other drugmakers must <em>pay $162.5 million in punitive damages for selling the anesthetic Propofol in a way that led three colonoscopy patients to develop Hepatitis C.</em><br /><br />Jurors in state court Las Vegas ordered <em>Teva Parenteral Medicines Inc., Baxter Healthcare Corp. and McKesson Corp. to pay so-called punishment damages</em> over sales of the anesthetic in vials large enough to be reused by doctors. Anne Arnold, Richard Sacks and Anthony Devito contend they contracted Hepatitis C from reused vials during colonoscopy procedures. They had sought more than $700 million in damages.<br /><br />It’s the second punitive award against Baxter and the unit of Petach Tikva, Israel-based Teva over a 2008 hepatitis outbreak in Nevada tied to Propofol. The first case resulted in a punitive verdict of more than $500 million against the drugmakers. Teva has agreed to cover all damage awards arising from the Nevada cases on behalf of Baxter and McKesson.</blockquote><br />In particular,<br /><blockquote>The patients’ lawyers <em>allege Teva intentionally sold Propofol in jumbo-sized vials to encourage doctors to reuse them, even with the risk of spreading blood-borne diseases such as hepatitis, an incurable liver disease.</em></blockquote><br />So the allegations are that the company intentionally put financial gain ahead of the safety of patients.<br /><br /><strong>Boston Scientific Settles Over-Billing Allegations</strong><br /><br />Again <a href="http://www.businessweek.com/news/2011-09-26/boston-scientific-to-pay-9-25-million-in-whistleblower-case.html">per</a> Bloomberg:<br /><blockquote><em>Boston Scientific Corp.’s Guidant LLC unit will pay $9.25 million to settle a whistleblower’s claim that the company over-billed the U.S. and private hospitals for heart pacemakers and defibrillators.</em></blockquote><br />The details:<br /><blockquote><em>Guidant allegedly reneged on credits owed to the U.S. Department of Veterans Affairs for replacement of units still under warranty and is accused of over-charging hospitals for the devices, causing them to over-bill Medicare</em>, according to an e-mailed statement from the Justice Department.</blockquote><br />Note that we have quite a extensive files on <a href="http://hcrenewal.blogspot.com/search/label/Boston%20Scientific">Boston Scientific</a>, and on <a href="http://hcrenewal.blogspot.com/search/label/Guidant">Guidant</a>, now its subsidiary.<br /><br /><strong>Hil-Rom Settles Fraud Allegations</strong><br /><br /><a href="http://www.knoxnews.com/news/2011/sep/27/feds-announce-418-million-settlement-in-fraud">Reported</a> by the Knoxville News-Sentinel:<br /><blockquote>Federal prosecutors announced Tuesday a <em>$41.8 million civil fraud settlement in a 'whistle-blower' lawsuit against international medical equipment supply company, Hill-Rom Company Inc.</em></blockquote><br />The results also were that<br /><blockquote>As part of the settlement, <em>Hill-Rom has entered into a five-year 'corporate integrity agreement,'</em> in which the firm will face close scrutiny by federal officials, Killian said.</blockquote>The allegations were:<br /><blockquote><em>'Hill-Rom submitted false claims for medical equipment for patients who did not qualify for the equipment</em>, including patients who had died, were no longer using the equipment or had been moved to nursing homes,' [US Attorney Bill] Killian said.</blockquote><br />In particular,<br /><blockquote>The lawsuit alleged the firm was ripping off Medicare with its faulty billing practices. According to the lawsuit, unsealed Tuesday, <em>Hill-Rom offered its sales representatives $200 gift certificates and 42-inch televisions as reward for boosting billings and, in 2001, laid off the lion's share of staff dedicated to ensuring compliance with Medicare rules</em>.</blockquote><br />Note that this suggests a pattern of providing incentives to employees who "make their numbers," no matter how they do so. We have seen how making the financial numbers seems to take precedence over all else, including patients' well-being, in many contemporary health care organizations.<br /><br /><strong>Maxim Healthcare Settles Fraud Allegations</strong><br /><br />In a <a href="http://www.baltimoresun.com/business/bs-bz-maxim-healthcare-settlement-2-20110912,0,4024222.story">story</a> in the Baltimore Sun,<br /><blockquote>A Columbia-based health care firm has agreed to a <em>$150 million settlement with the federal government and 43 states to resolve criminal and civil charges that it submitted claims for millions of dollars of work that it did not perform and operated offices that were not properly licensed,</em> officials said Monday.<br /><br />A five-year federal investigation found that Maxim Healthcare Services Inc., one of the country's largest providers of home healthcare services, submitted<em> $61 million in false claims for services to the federal government's Medicaid and Veterans Affairs health programs</em> over an 11-year period from 1998 to 2009.<br /><br />Investigators said managers and workers at Maxim repeatedly modified time sheets and documents to cover up the fraud, creating <em>a culture in which submitting false claims became 'common practice.'</em></blockquote><br />The settlement was of criminal as well as civil charges:<br /><blockquote>The settlement includes a <em>$20 million criminal fine</em> and $130 million in civil settlements.</blockquote><br />It will also involve a deferred prosecution or corporate integrity agreement:<br /><blockquote>In addition to the fines, Maxim also <em>has been charged criminally with conspiracy to commit health care fraud.</em> But the company could avoid conviction if it meets requirements outlined in the settlement.</blockquote><br />Unlike many such cases, this one involved criminal charges for and guilty pleas by some people involved in the wrong-doing, in this case, middle managers:<br /><blockquote><em>Several regional account managers, a home health aid and a clinical services director also pleaded guilty to criminal charges</em>, government officials said. They could face as much as $250,000 in fines and jail time for their roles in the fraud.</blockquote><br />Another atypical result was that the CEO who presided over the misbehavior actually suffered some consequences, although he did not have to pay fines for face criminal charges,<br /><blockquote>Maxim officials said they take full responsibility for the violations. The company said it <em>hired a new CEO in 2009</em> and changed its business practices to protect against a repeat.</blockquote><br />ProPublica published an <a href="http://www.propublica.org/article/troubled-health-care-staffing-chain-settles-with-government-for-150-million">article</a> at the same time which noted that Maxim's practices had come into question before, <br /><blockquote>A different set of problems involving Maxim came up during a ProPublica investigation into the oversight of registered nurses in 2009. We identified several nurses who were <em>hired by the Maryland-based company despite having a record of problems.</em></blockquote><br />Although that previous article did not mention the company's name:<br /><blockquote>The articles focused on how regulators across the country did little to scrutinize troubled nurses who crossed state lines to continue working. Our earlier stories did not identify Maxim by name. </blockquote><br />We have noted that organizations which misbehave once are likely to misbehave again. This may stem from an organizational culture that puts revenue ahead of ethics and patients' and the public's health, and the lack of negative consequences that people who respond to the resulting positive financial incentives are likely to suffer.<br /><br /><strong>Medicis Settles Shareholder Class-Action Lawsuit</strong><br /><br /><a href="http://www.azcentral.com/business/news/articles/2011/09/28/20110928medicis-auditor-will-pay-18-million-settle-suit.html">Noted</a> by the Arizona Republic,<br /><blockquote>Medicis Pharmaceutical Corp. and its auditing firm, Ernst & Young, have agreed to <em>pay $18 million to settle a shareholder class-action lawsuit stemming from the pharmaceutical company's financial statements.</em></blockquote><br />The shareholders alleged that Medicis was not honest about its financial affairs:<br /><blockquote>The shareholders' lawsuit stems from Medicis' announcement in September 2008 that it would restate earnings from 2003 through the first half of 2008.<br /><br />Shareholders alleged that Medicis offered its wholesale customers generous return policies for prescription drugs as part of an effort to inflate the company's revenue. Medicis would accept returned products that were expired or about to expire at either no cost or substantial discounts to the wholesale customers, according to the lawsuit.</blockquote><br /><strong>Summary</strong><br /><br />The constant march of <a href="http://hcrenewal.blogspot.com/search/label/legal%20settlements">legal settlements </a>by, jury verdicts against, and in some cases <a href="http://hcrenewal.blogspot.com/search/label/crime">criminal convictions </a>of or guilty pleas by large health care corporations indicate how common misbehavior by such organizations has become. Since it is likely that much misbehavior does not lead to publicly announced legal actions, what is published can only provide a floor for an estimate of how common it is. The march, which we have been documenting since starting Health Care Renewal, shows how sleazy and often corrupt health care has become, and how that sleaziness and corruption is prevalent not just among small players, but among the biggest and richest health care organizations, and their top leaders. <br /><br />One reason the situation continues to be so bad is that while the unethical behavior does sometimes result in pontificating by the civil authorities, and fines that may only be costs of doing business, it rarely leads to meaningful negative consequences for those who authorized, directed or implemented it. This was noted in the reporting of the Maxim Healthcare case above. For example, in the Baltimore Sun <a href="http://www.baltimoresun.com/business/bs-bz-maxim-healthcare-settlement-2-20110912,0,4927923,print.story">article</a> we found,<br /><blockquote>One watchdog group called the penalty a drop in the bucket for a company that had $2 billion in reimbursements from 2003 to 2009.<br /><br />'That is hardly crippling,' said Joe Newman, a spokesman for the Project on Government Oversight, which tracks government contractors. 'It is certainly something that stings Maxim's pocketbook, but they will be fine after that.'<br /><br />'They won't be barred from the Medicaid program. That would hurt them.'</blockquote><br />Also, Sun columnist Jay Hancock <a href="http://www.baltimoresun.com/business/bs-bz-hancock-prmc-accountability-20110919,0,1446559.column">wrote</a>:<br /><blockquote>Corporations are happy to be treated as people under the law, as we know from recent court decisions. They can own property. They can seek redress in Congress and the courts. They can make huge political contributions.<br /><br />But <em>when it comes to being penalized for cheating the government, corporations quickly abandon their personhood and go back to being abstract blobs</em>.<br /><br />'I don't know about you, but if I hired a contractor to work on my house and he charged me a ton of extra money for work he didn't do, I wouldn't use that contractor again,' Minnesota Sen. Al Franken said in Congress a few months ago. 'And I would make sure my friends knew not to use them either. It seems like the same should be true of government contractors.'</blockquote><br />But that is often not the case. For years, government agencies have not vigorously enforced the law when doing so might inconvenience big corporations and their well-paid executives. Maybe this lenience stems from the loony philosophy of former Chairman of the Federal Reserve Alan Greenspan, who was once regarded as some sort of economic genius, who seemed to think that fraud cannot occur in his idealized idea of a free market, because somehow all bad actors would become widely known and therefore all counter-parties would avoid them. In an <a href="http://www.stanfordalumni.org/news/magazine/2009/marapr/features/born.html">article</a> in Stanford Magazine,<br /><blockquote><em>The influential Greenspan was an ardent proponent of unfettered markets</em>. Born was a powerful Washington lawyer with a track record for activist causes. Over lunch, in his private dining room at the stately headquarters of the Fed in Washington, Greenspan probed their differences.<br /><br />'Well, Brooksley, I guess <em>you and I will never agree about fraud</em>,' Born, in a recent interview, remembers Greenspan saying.<br /><br />'What is there not to agree on?' Born says she replied.<br /><br />'Well, you probably will always believe there should be laws against fraud, and <em><strong>I don’t think there is any need for a law against fraud,' she recalls. Greenspan, Born says, believed the market would take care of itself.</strong></em><br /><br />For the incoming regulator, the meeting was a wake-up call. 'That underscored to me how absolutist Alan was in his opposition to any regulation,' she said in the interview.</blockquote><br />It is a measure of the insanity of recent years that one of the chief leaders of government economic policy did not believe there was any need for laws against fraud.<br /><br />It appears that this daft idea has carried over to and still influences how many in government and out deal with health care. However, as we have d<a href="http://hcrenewal.blogspot.com/2010/08/how-fallacy-of-perfect-health-care.html">discussed</a>, health care is not and probably cannot ever be an ideal free market. Also, in health care, most of the bad actions remain <a href="http://hcrenewal.blogspot.com/search/label/anechoic%20effect">anechoic</a>, and in many cases it may be hard for counter-parties to avoid bad actors because they may dominate the market. Also, it may be those that make decisions about whether to deal with particular organizations may be executives, and sometimes health care professionals who have become indifferent to the ethical issues.<br /><br />As I have said again and again, pervasive bad behavior by large health care organizations has got to be a major cause of our ongoing health care dysfunction.<br /><br />So, to really deter bad behavior, those who authorized, directed or implemented bad behavior must be held accountable. As long as they are not, expect the bad behavior to continue.

Another Month, Another Set of Legal Settlements, Deferred Prosecution Agreements, and Jury Findings Adverse to Large Health Care Corporations

Another month, another series of adverse legal rulings suggesting misbehavior by large health care organizations.  In alphabetical order,......

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JAMA Article Begs Key Questions About Case of Contaminated Heparin

There was a recent reminder of the case of the tainted heparin, which begged more questions than it answered.  (A case summary is appended to the end of this post, and nearly all our posts are <a href="http://hcrenewal.blogspot.com/search/label/heparin">here</a>.)  The case is of fundamental importance because it involves the failure of pharmaceutical companies to fulfill their core mission, to supply pure, unadulterated drugs.   Three years later, how the heparin was adulterated, and who was responsible are still unknown. <br />JAMA just published a major news article (Kuehn BM. As production goes global, drug supply faces greater risks to safety, quality.  JAMA 2011; 306: 811-813.  Link <a href="http://jama.ama-assn.org/content/306/8/811.full">here</a>.) This, in turn, was based on a five page case study of the heparin incident in a report by the Pew Health Group entitled "After Heparin: Protecting Consumers from the Risk of Substandard and Counterfeit Drugs" (link <a href="http://www.prescriptionproject.org/assets/pdfs/Pew_Heparin_Round4b_SinglePgs_b.pdf">here</a>).  Reading between the lines, the Kuehn article raised several questions which it did not seek to answer, but which we have raised previously.<br /><br /><strong>Why Didn't Baxter Look the Gift Horse in the Mouth?</strong><br /><br />The JAMA article noted that in general, "pharmaceutical companies are shifting the production of drugs and drug ingredients to emerging economies - primarily India and China - <em>to save money</em>."  [italics added for emphasis]  Also, "Many emerging economies <em>do not have robust regulatory systems</em>, and regulators from the United States or other countries may face hurdles in trying to oversee production in these nations."<br /><br />Why were Baxter International executives not concerned about the quality of a drug offered cheaply from firms in countries with little regulatory oversight?  <br /><br />Note that we have been asking versions of this question since 2008, e.g., "How hard did Baxter scrutinize the production of the drug? How hard did SPL scrutinize its production? Did Baxter, SPL and/or the FDA realize the drug was being produced in an unlicensed Chinese chemical factory which had never been inspected by the Chinese or US government? If they did, why did they accept its product? If they didn't, why didn't they know?" - from <a href="http://hcrenewal.blogspot.com/2008/02/in-middle-of-all-those-pigs-in-china.html">this post</a> on February, 16, 2008.<br /><br /><strong>Who Is Responsible for the Complexity and Opacity of the Out-Sourced Supply Chain?</strong><br /><br />The article stated, "In addition to becoming more global, the drug supply chain has also become more complex, .... Drug ingredients are now imported from 150 countries, and multiple suppliers, producers, and distributors may be involved in the production and import of a single drug." <br /><br />In particular, the article noted that "Baxter relied on the assessment of another company when it began receiving heparin from the plant through which the adulterated drug came."  (The nameless other company was Scientific Protein Laboratories.)  Also, it noted that the supply chain began at "the primitive workshops that extract heparin crude by cooking and drying pig intestines" and proceeded to "the companies that consolidate materials from many such workshops and sell them to the factories that produce heparin."  The article did not discuss how this particular supply chain came into existence.<br /><br />Did not drug companies in developed countries, like Baxter International in this case, create these convoluted supply chains (mainly to save money, as noted above)?  If not, did they not at least enable the creation and operation of these chains by purchasing their products without asking too may questions?  In any case, the supply chain's complexity and opacity arose out of individual humans' decisions, not an act by a deity. <br /><br /><strong>Why Have no Individuals Been Held Accountable? </strong><br /><br />The article noted that the Pew report suggested, "increasing the financial penalties and allowable prison terms for individuals and companies who violate the rules from their current maximums of $10 000 or 3 years in prison." The implication was that these penalties have proven insufficient.  However, the article failed to note that so far in the case of the tainted heparin, no such penalties have even been sought.  To my knowledge, neither Baxter International, Scientific Protein Laboratories, nor any individual who worked for them has ever been charged with any violation of "the rules" that could result in any penalty as much as "$10 000 or 3 years in prison."    I have asked repeatedly why so far there has been no obvious effort to hold any individual accountable for the contaminated heparin?  (see <a href="http://hcrenewal.blogspot.com/2010/07/prosecuting-doctors-for-importing-iuds.html">this post</a> from July 19, 2010, in which I noted legal actions against doctors who implanted IUDs imported from and approved in Canada and asked, "why are we so vigorously pursuing individual doctors for an apparently technical violation of laws that did patients no apparent harm, when we are not pursuing health care corporate executives for selling adulterated drugs that likely killed patients? <br /><br /><strong>Why Are the Key Issues In This Case Still So Anechoic?</strong><br /><br />Neither the JAMA article nor the heparin case study in the underlying Pew report directly addressed these questions.  The JAMA article also omitted such details as the name of the company from which Baxter directly purchased the heparin (Scientific Protein Laboratories) and the total number of deaths that may have been related to the heparin.  (It only mentioned 3 deaths related to heparin, while the Pew Report noted the FDA got reports of 68, six more of which it allowed were "possibly caused by the adulterant, 24 were unlikely, and 35 were unassessable.")  As mentioned above, the JAMA article seemed to imply that criminal penalties have been applied to corporate executives whose companies may have profited from cheap but defective out-sourced drugs (but none have been applied in the heparin case).   Ironically, while the JAMA article identified the "culprit" for the adverse events in the heparin case, it used the word to refer to the compound that adulterated the heparin, not those who added it, or who enabled its addition. <br /><br /><strong>Summary</strong><br /><br />Thus, the public discussion in the main-stream medical media of the case of the adulterated heparin is still remarkably squeamish even three plus years after it first became public.  While the heparin case has made it into major medical journals, it still simply is <em>not done</em> to even publicly discuss whether the leaders of health care organizations who become rich partly as a result of decisions such as the unsupervised, uninspected, apparently barely considered out-sourcing of heparin to be accountable when these decisions turn out to have adverse effects on patients.<br /><br />If we cannot even discuss the accountability of leaders of health care organizations, how can we hope to actually hold them accountable?  <br /><br />To repeatedly reiterate, as long as the leaders of health care organizations are not held accountable for the results of their decisions on health care quality, cost, and access (even in such extreme quality violations as those resulting in multiple patient deaths), we can expect continuing decisions that sacrifice quality, increase costs, and worsen access, but that are in the self-interest of the people making them.<br /><br /><br />To really reform health care, we must hold health care organizations and their leaders accountable (and not blame all the problems on doctors, other health care professionals, patients, and society at large).<br /><br /><span style="color: blue; font-size: x-small;">Case Summary</span><br /><br /><span style="color: blue; font-size: x-small;">- We have posted several times, recently <a href="http://hcrenewal.blogspot.com/2011/06/first-contaminated-heparin-case-verdict.html">here</a></span><span style="color: blue; font-size: x-small;"> about the tragic case of suddenly allergenic heparin. Although heparin, an intravenous biologic anti-coagulant, has been in use for over 70 years, serious allergic reactions to it had heretofore been rare. Starting late in 2007, hundreds of such reactions, and 21 deaths were reported in the US after intravenous heparin infusions.All the heparin related to these events in the US was made by Baxter International.</span><br /><span style="color: blue; font-size: x-small;"></span><br /><br /><span style="color: blue; font-size: x-small;">- We then learned that although the heparin carried the Baxter label, it was not really made by Baxter. The company had outsourced production of the active ingredient to a long, and ultimately mysterious supply chain. Baxter got the active ingredient from a US company, Scientific Protein Laboratories LLC, which in turn obtained it from a factory in China operated by Changzhou SPL, which in turn was owned by Scientific Protein Laboratories and by Changzhou Techpool Pharmaceutical Co. Changzhou SPL, in turn, got it from several consolidators or wholesalers, who in turn got it from numerous small, unidentified "workshops," which seemed to produce the product in often primitive and unsanitary conditions. None of the stops in the Chinese supply chain had apparently been inspected by the US Food and Drug Administration nor its Chinese counterpart. (See posts <a href="http://hcrenewal.blogspot.com/2008/02/in-middle-of-all-those-pigs-in-china.html">here</a> and <a href="http://hcrenewal.blogspot.com/2008/03/heparin-in-era-of-hogwash.html">here</a>.)</span><br /><br /><span style="color: blue; font-size: x-small;">- We found out that the Baxter International labelled heparin was contaminated with over-sulfated chondroitin sulfate, a substance not found in nature, but which mimics heparin according to the simple laboratory tests used in the Chinese facilities to check incoming heparin. (See post </span><a href="http://hcrenewal.blogspot.com/2008/03/fake-heparin-then-sick-and-dead.html"><span style="color: blue; font-size: x-small;">here</span></a><span style="color: blue; font-size: x-small;">.) Further testing revealed that the contamination seemed to have taken place in China prior to the provision of the heparin to Changzhou SPL. (See post </span><a href="http://hcrenewal.blogspot.com/2008/03/who-was-responsible-for-purity-of.html"><span style="color: blue; font-size: x-small;">here</span></a><span style="color: blue; font-size: x-small;">.) It is not clear whether Baxter International or Scientific Protein Laboratories had inspected most of the steps in the supply chain, or even knew what went on there.</span><br /><br /><span style="color: blue; font-size: x-small;">- The Baxter and Scientific Protein Laboratories CEOs did not seem aware of where they got the heparin on which the Baxter International label was eventually affixed. But one report in the New York Times alleged that Scientific Protein Laboratories would not pay enough for heparin to satisfy any sources other than the small "workshops."</span><br /><span style="font-size: x-small;"><br /><span style="color: blue;"></span></span><br /><span style="color: blue; font-size: x-small;">- Leaders of all organizations involved, Baxter International, Scientific Protein Laboratories, Changzhou SPL, the Chinese government, and the US Food and Drug Administration, and the US Congress assigned blame to each other, but none took individual or organizational responsibility. (See post </span><a href="http://hcrenewal.blogspot.com/2008/05/blaming-some-dude-for-contaminated.html"><span style="color: blue; font-size: x-small;">here</span></a><span style="color: blue; font-size: x-small;">.)  Note that SPL was recently bought out and taken private, making its current leadership even less transparent (see post </span><a href="http://hcrenewal.blogspot.com/2010/10/more-contaminated-heparin-but-who-leads.html"><span style="color: blue; font-size: x-small;">here</span></a><span style="color: blue; font-size: x-small;">).  A 2010 inspection of an SPL facility by the FDA revealed ongoing manufacturing problems (see post </span><a href="http://hcrenewal.blogspot.com/2011/02/fda-to-scientific-protein-laboratories.html"><span style="color: blue; font-size: x-small;">here</span></a><span style="color: blue; font-size: x-small;">).</span><br /><br /><span style="color: blue; font-size: x-small;">- Researchers (who turned out to have financial ties to a company which is developing an anti-coagulant drug that could compete with the heparin made by Baxter International) investigated the biological mechanisms by which the contamination of the heparin lead to adverse effects, but no one investigated further how the contamination occurred, or who was responsible. (See post </span><a href="http://hcrenewal.blogspot.com/2009/08/who-investigated-case-of-deadly.html"><span style="color: blue; font-size: x-small;">here</span></a><span style="color: blue; font-size: x-small;">.)</span><br /><br /><span style="color: blue; font-size: x-small;">- Hundreds of lawsuits against Baxter have now been filed, so far without resolution. (See post </span><a href="http://hcrenewal.blogspot.com/2010/01/blog-post.html"><span style="color: blue; font-size: x-small;">here</span></a><span style="color: blue; font-size: x-small;">.)  Efforts to make documents to be used in these cases public so far have not succeeded (see post </span><a href="http://hcrenewal.blogspot.com/2010/08/proprietary-information-confidentiality.html"><span style="color: blue; font-size: x-small;">here</span></a><span style="color: blue; font-size: x-small;">).</span><br /><br /><span style="color: blue; font-size: x-small;">- A government report which attracted little attention warned of the dangers of pharmaceutical ingredients made in China and subject to virtually no oversight. (See post </span><a href="http://hcrenewal.blogspot.com/2010/04/another-echo-of-case-of-deadly-heparin.html"><span style="color: blue; font-size: x-small;">here</span></a><span style="color: blue; font-size: x-small;">.)</span><br /><br /><span style="color: blue; font-size: x-small;">-  Despite requests from the US, the Chinese government did not investigate the production of the heparin that lead to the deaths (see post </span><a href="http://hcrenewal.blogspot.com/2010/07/more-about-what-we-dont-know-about.html"><span style="color: blue; font-size: x-small;">here</span></a><span style="color: blue; font-size: x-small;">.)</span><br /><br /><span style="color: blue; font-size: x-small;">-  In February, 2011, a congressional investigation of the case was announced, but results are so far unavailable (see post <a href="http://hcrenewal.blogspot.com/2011/02/three-years-later-congressional.html">here</a>.)</span><br /><br /><span style="color: blue; font-size: x-small;">-  In June, 2011, a jury returned the first verdict in a civil case about the contaminated heparin, awarding money from Baxter International and Scientific Protein Laboratories to the estate of a man who apparently died due to tainted heparin (see post <a href="http://hcrenewal.blogspot.com/2011/06/first-contaminated-heparin-case-verdict.html">here</a>).</span>

JAMA Article Begs Key Questions About Case of Contaminated Heparin

There was a recent reminder of the case of the tainted heparin, which begged more questions than it answered.  (A case summary is appended t...

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The First Contaminated Heparin Case Verdict: Making Money by Giving Patients "the Cheap Stuff"

In February, 2008, we first <a href="http://hcrenewal.blogspot.com/2008/02/in-middle-of-all-those-pigs-in-china.html">posted</a> about the case of the deadly adulterated heparin.  (A case summary is appended to the end of this post, and nearly all our posts are <a href="http://hcrenewal.blogspot.com/search/label/heparin">here</a>.)  The case is of fundamental importance because it involves the failure of pharmaceutical companies to fulfill their core mission, to supply pure, unadulterated drugs.  It is also of fundamental importance because it may be about how this failure to fulfill core mission was not due to accident, or even simple incompetence, but due to putting financial goals ahead of patient safety.  <br /><br />The latest event in the very slowly unfolding aftermath of this case was the first verdict against the sellers of the heparin in a civil trial in a US court room.  As <a href="http://www.chicagotribune.com/business/breaking/chi-baxter-loses-first-heparin-case-20110609,0,1020947.story">reported</a> by the Chicago Tribune,<br /><blockquote>A Cook County Circuit Court jury Thursday awarded $625,000 to the estate of a man who his attorneys say was given a dosage of a blood thinner made by Baxter International Inc. that contained a contaminated ingredient found in the company's supply chain in China.<br /><br />The verdict is the <em>first from a case against Baxter and its supplier, Wisconsin-based Scientific Protein Laboratories, from hundreds of lawsuits</em> filed against the Deerfield-based medical product giant. A mountain of litigation has been leveled against the companies after U.S. regulators determined in 2008 that Baxter's heparin was contaminated, from fake ingredients sourced in China.</blockquote><br />A statement by the (winning) plaintiff's attorneys underscored that this case may have been about cutting costs winning out over patient safety:<br /><blockquote>'The active pharmaceutical ingredient in the contaminated heparin received by Mr. Johansen and other Americans was obtained from Baxter (and its supplier Scientific Protein Laboratories') Changzhou SPL,' Johansen estate attorneys Don Nolan of Chicago and David Zoll of Toledo, Ohio said in a statement this afternoon. <em>'This crude heparin was referred to in the companies' own internal records as <strong>'the cheap stuff.'</strong></em> The contaminant was determined to be a man-made 'fake heparin' called over-sulfated chondroitin sulfate, causing among other effects, potentially fatal allergic-like reactions.'</blockquote><br />As explained in <a href="http://postscript.communitycatalyst.org/?p=2770">this post</a> in the Postscript blog:<br /><blockquote>Baxter and its ingredient supplier, Scientific Protein Laboratories (SPL), announced in 2008 that<em> the OSCS contaminant was introduced intentionally by their suppliers in China. Financial motives are presumed, because Heparin costs 100 times more to make than OSCS.</em> In addition, Heparin which is harvested and purified from the intestines of pigs, was even harder to obtain in 2007-08 because a global pig disease epidemic had created an unexpected shortage in China and elsewhere.<br /><br />The timing was right, and seems the chemistry was, too. The OSCS contaminant was not initially discovered because it mimics some chemical properties of Heparin, <em>suggesting that it was introduced by suppliers in China who possessed the biochemical savvy to fool the standard chemical purity tests then in use by Baxter and the FDA. </em>(The assay test has since been improved by the US Pharmacopeia.)</blockquote>So it appeared in their haste to cut costs, Baxter International, and its US based supplier, Scientific Protein Laboratories, failed to consider that heparin chosen because it was "the cheap stuff" might not turn out to be safe. In particular, they seemed to be wilfully blind to the prospect that pushing for the cheapest price without inquiring too deeply into the details of the supply chain might tempt those down the chain to cheat, and in doing so, to disregard the safety of those patients (in another country) who would be infused with the resulting adulterated product.  This thus appears to be a vivid, and fatal case of mission-hostile management.<br /><br />Meanwhile, we still await the result of the investigation that was supposed to have started in February, 2011 (see <a href="http://hcrenewal.blogspot.com/2011/02/three-years-later-congressional.html">this post</a>.) <br /><br />To reiterate, as long as the leaders of health care organizations are not held accountable for the results of their decisions on health care quality, cost, and access (even in such extreme quality violations as those resulting in multiple patient deaths), we can expect continuing decisions that sacrifice quality, increase costs, and worsen access, but that are in the self-interest of the people making them.<br /><br />To really reform health care, we must hold health care organizations and their leaders accountable (and not blame all the problems on doctors, other health care professionals, patients, and society at large).<br /><br /><span style="color: blue; font-size: x-small;">Case Summary</span><br /><br /><span style="color: blue; font-size: x-small;">- We have posted several times, recently </span><a href="http://hcrenewal.blogspot.com/2011/02/fda-to-scientific-protein-laboratories.html"><span style="color: blue; font-size: x-small;">here</span></a><span style="color: blue; font-size: x-small;">, about the tragic case of suddenly allergenic heparin. Although heparin, an intravenous biologic anti-coagulant, has been in use for over 70 years, serious allergic reactions to it had heretofore been rare. Starting late last year, hundreds of such reactions, and now 21 deaths were reported in the US after intravenous heparin infusions.All the heparin related to these events in the US was made by Baxter International.</span><br /><span style="color: blue; font-size: x-small;"></span><br /><br /><span style="color: blue; font-size: x-small;">- We then learned that although the heparin carried the Baxter label, it was not really made by Baxter. The company had outsourced production of the active ingredient to a long, and ultimately mysterious supply chain. Baxter got the active ingredient from a US company, Scientific Protein Laboratories LLC, which in turn obtained it from a factory in China operated by Changzhou SPL, which in turn was owned by Scientific Protein Laboratories and by Changzhou Techpool Pharmaceutical Co. Changzhou SPL, in turn, got it from several consolidators or wholesalers, who in turn got it from numerous small, unidentified "workshops," which seemed to produce the product in often primitive and unsanitary conditions. None of the stops in the Chinese supply chain had apparently been inspected by the US Food and Drug Administration nor its Chinese counterpart.</span><br /><br /><span style="color: blue; font-size: x-small;">- We found out that the Baxter International labelled heparin was contaminated with over-sulfated chondroitin sulfate, a substance not found in nature, but which mimics heparin according to the simple laboratory tests used in the Chinese facilities to check incoming heparin. (See post </span><a href="http://hcrenewal.blogspot.com/2008/03/fake-heparin-then-sick-and-dead.html"><span style="color: blue; font-size: x-small;">here</span></a><span style="color: blue; font-size: x-small;">.) Further testing revealed that the contamination seemed to have taken place in China prior to the provision of the heparin to Changzhou SPL. (See post </span><a href="http://hcrenewal.blogspot.com/2008/03/who-was-responsible-for-purity-of.html"><span style="color: blue; font-size: x-small;">here</span></a><span style="color: blue; font-size: x-small;">.) It is not clear whether Baxter International or Scientific Protein Laboratories had inspected most of the steps in the supply chain, or even knew what went on there.</span><br /><br /><span style="color: blue; font-size: x-small;">- The Baxter and Scientific Protein Laboratories CEOs did not seem aware of where they got the heparin on which the Baxter International label was eventually affixed. But one report in the New York Times alleged that Scientific Protein Laboratories would not pay enough for heparin to satisfy any sources other than the small "workshops."</span><br /><span style="font-size: x-small;"><br /><span style="color: blue;"></span></span><br /><span style="color: blue; font-size: x-small;">- Leaders of all organizations involved, Baxter International, Scientific Protein Laboratories, Changzhou SPL, the Chinese government, and the US Food and Drug Administration, and the US Congress assigned blame to each other, but none took individual or organizational responsibility. (See post </span><a href="http://hcrenewal.blogspot.com/2008/05/blaming-some-dude-for-contaminated.html"><span style="color: blue; font-size: x-small;">here</span></a><span style="color: blue; font-size: x-small;">.)  Note that SPL was recently bought out and taken private, making its current leadership even less transparent (see post </span><a href="http://hcrenewal.blogspot.com/2010/10/more-contaminated-heparin-but-who-leads.html"><span style="color: blue; font-size: x-small;">here</span></a><span style="color: blue; font-size: x-small;">).  A 2010 inspection of an SPL facility by the FDA revealed ongoing manufacturing problems (see post </span><a href="http://hcrenewal.blogspot.com/2011/02/fda-to-scientific-protein-laboratories.html"><span style="color: blue; font-size: x-small;">here</span></a><span style="color: blue; font-size: x-small;">).</span><br /><br /><span style="color: blue; font-size: x-small;">- Researchers (who turned out to have financial ties to a company which is developing an anti-coagulant drug that could compete with the heparin made by Baxter International) investigated the biological mechanisms by which the contamination of the heparin lead to adverse effects, but no one investigated further how the contamination occurred, or who was responsible. (See post </span><a href="http://hcrenewal.blogspot.com/2009/08/who-investigated-case-of-deadly.html"><span style="color: blue; font-size: x-small;">here</span></a><span style="color: blue; font-size: x-small;">.)</span><br /><br /><span style="color: blue; font-size: x-small;">- Hundreds of lawsuits against Baxter have now been filed, so far without resolution. (See post </span><a href="http://hcrenewal.blogspot.com/2010/01/blog-post.html"><span style="color: blue; font-size: x-small;">here</span></a><span style="color: blue; font-size: x-small;">.)  Efforts to make documents to be used in these cases public so far have not succeeded (see post </span><a href="http://hcrenewal.blogspot.com/2010/08/proprietary-information-confidentiality.html"><span style="color: blue; font-size: x-small;">here</span></a><span style="color: blue; font-size: x-small;">).</span><br /><br /><span style="color: blue; font-size: x-small;">- A government report which attracted little attention warned of the dangers of pharmaceutical ingredients made in China and subject to virtually no oversight. (See post </span><a href="http://hcrenewal.blogspot.com/2010/04/another-echo-of-case-of-deadly-heparin.html"><span style="color: blue; font-size: x-small;">here</span></a><span style="color: blue; font-size: x-small;">.)</span><br /><br /><span style="color: blue; font-size: x-small;">-  Despite requests from the US, the Chinese government did not investigate the production of the heparin that lead to the deaths (see post </span><a href="http://hcrenewal.blogspot.com/2010/07/more-about-what-we-dont-know-about.html"><span style="color: blue; font-size: x-small;">here</span></a><span style="color: blue; font-size: x-small;">.)</span><br /><br /><span style="color: blue; font-size: x-small;">-  In February, 2011, a congressional investigation of the case was announced, but results are so far unavailable (see post <a href="http://hcrenewal.blogspot.com/2011/02/three-years-later-congressional.html">here</a>.)</span>

The First Contaminated Heparin Case Verdict: Making Money by Giving Patients "the Cheap Stuff"

In February, 2008, we first posted about the case of the deadly adulterated heparin.  (A case summary is appended to the end of this post, ...

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Three Years Later, A Congressional Investigation of the Deadly Adulterated Heparin

Slightly more than three years ago, we first <a href="http://hcrenewal.blogspot.com/2008/02/in-middle-of-all-those-pigs-in-china.html">posted</a> about the case of the deadly adulterated heparin.  (A case summary is appended to the end of this post, and nearly all our posts are <a href="http://hcrenewal.blogspot.com/search/label/heparin">here</a>.)  The case is of fundamental importance because it involves the failure of pharmaceutical companies to fulfill their core mission, to supply pure, unadulterated drugs.   Three years later, how the heparin was adulterated, and who was responsible are still unknown. <br /><br />So now, it seems, there will actually be an official investigation.  As<a href="http://online.wsj.com/article/SB10001424052748703775704576162450111643240.html"> reported</a> by Alicia Mundy in the Wall Street Journal,<br /><blockquote>The House Energy and Commerce Committee<em> is conducting a formal investigation into the contaminated-heparin crisis of 2008,</em> saying it wants regulators to figure out who was responsible for adulteration linked to 81 U.S. deaths.<br /><br />The panel's chairman, Rep. Fred Upton (R., Mich.), and two colleagues sent a letter Wednesday to the Food and Drug Administration asking for documents on whether the agency pursued possible culprits in China and pushed the Chinese government for more information.<br /><br />'The committee is investigating the <em>unsolved case of who contaminated the U.S. supply of heparin,</em>' a blood thinner used by about 12 million Americans annually, said Mr. Upton, joined by Reps. Clifford Stearns (R., Fla.) and Michael Burgess (R., Texas).</blockquote><br />Better late than never, I suppose. <a href="http://hcrenewal.blogspot.com/2008/03/contaminated-heparin-where-is-outrage.html">In March, 2008</a>, I called the case "outrageous," and called for an investigation. You really did hear it here first on Health Care Renewal. So three years later, an investigation has actually begun. <br /><br />The latest WSJ article noted:<br /><blockquote><em>'There is substantial public interest in solving this case' because more than 80% of the standard heparin supply in the U.S. today comes from China</em>, the lawmakers wrote. About 16% of all pharmaceutical ingredients in the country are imported from China, they wrote.</blockquote><br />Also,<br /><blockquote>'There is reason to believe all or some of the individuals responsible for the adulteration are <em>still actively engaged in the Chinese pharmaceutical supply chain, and pose a <strong>continuing threat</strong> to pharmaceutical products imported to the U.S</em>.,' the lawmakers wrote.</blockquote><br />However, why this "substantial public interest" and the existence of "a continuing threat" did not lead to an investigation earlier is still completely obscure. <br /><br />The article hinted at some partisan discord in the committee that will do the investigation:<br /><blockquote>Over the last two years, Mr. Burgess and the Energy and Commerce Committee's then-top Republican, Rep. Joe Barton of Texas, <em>pressed the FDA for information on the agency's inspections of Chinese heparin facilities and on the extent of cooperation from national and local Chinese authorities. </em><br /><br />At the time, Republicans were in the minority. Their inquiries didn't constitute a committee investigation, and they couldn't demand nonpublic information from the FDA or call hearings. They now are in the majority and have those powers. </blockquote><br />The implication is that the Democrats on the committee blocked the investigation. Why they would have blocked an investigation when the executive branch was in Republican hands, and why the matter could not have been investigated in another congressional committee, or by some other organization, is unknown.<br /><br />So, again, better late than never. An investigation could at least be the beginnings of accountability for the very well paid pharmaceutical company leaders who up to now have denied all responsibility for failing their most important responsibility, to provide pure, unadulterated drugs. <br /><br />As we have said again and again, as long as the leaders of health care organizations are not held accountable for the results of their decisions on health care quality, cost, and access (even in such extreme quality violations as those resulting in multiple patient deaths), we can expect continuing decisions that sacrifice quality, increase costs, and worsen access, but that are in the self-interest of the people making them.<br /><br />To really reform health care, we must hold health care organizations and their leaders accountable (and not blame all the problems on doctors, other health care professionals, patients, and society at large). <br /><br /><span style="color: blue; font-size: x-small;">Case Summary</span><br /><br /><span style="color: blue; font-size: x-small;">- We have posted several times, recently </span><a href="http://hcrenewal.blogspot.com/2011/02/fda-to-scientific-protein-laboratories.html"><span style="color: blue; font-size: x-small;">here</span></a><span style="color: blue; font-size: x-small;">, about the tragic case of suddenly allergenic heparin. Although heparin, an intravenous biologic anti-coagulant, has been in use for over 70 years, serious allergic reactions to it had heretofore been rare. Starting late last year, hundreds of such reactions, and now 21 deaths were reported in the US after intravenous heparin infusions.All the heparin related to these events in the US was made by Baxter International.</span><br /><span style="color: blue; font-size: x-small;"></span><br /><br /><span style="color: blue; font-size: x-small;">- We then learned that although the heparin carried the Baxter label, it was not really made by Baxter. The company had outsourced production of the active ingredient to a long, and ultimately mysterious supply chain. Baxter got the active ingredient from a US company, Scientific Protein Laboratories LLC, which in turn obtained it from a factory in China operated by Changzhou SPL, which in turn was owned by Scientific Protein Laboratories and by Changzhou Techpool Pharmaceutical Co. Changzhou SPL, in turn, got it from several consolidators or wholesalers, who in turn got it from numerous small, unidentified "workshops," which seemed to produce the product in often primitive and unsanitary conditions. None of the stops in the Chinese supply chain had apparently been inspected by the US Food and Drug Administration nor its Chinese counterpart.</span><br /><br /><span style="color: blue; font-size: x-small;">- We found out that the Baxter International labelled heparin was contaminated with over-sulfated chondroitin sulfate, a substance not found in nature, but which mimics heparin according to the simple laboratory tests used in the Chinese facilities to check incoming heparin. (See post </span><a href="http://hcrenewal.blogspot.com/2008/03/fake-heparin-then-sick-and-dead.html"><span style="color: blue; font-size: x-small;">here</span></a><span style="color: blue; font-size: x-small;">.) Further testing revealed that the contamination seemed to have taken place in China prior to the provision of the heparin to Changzhou SPL. (See post </span><a href="http://hcrenewal.blogspot.com/2008/03/who-was-responsible-for-purity-of.html"><span style="color: blue; font-size: x-small;">here</span></a><span style="color: blue; font-size: x-small;">.) It is not clear whether Baxter International or Scientific Protein Laboratories had inspected most of the steps in the supply chain, or even knew what went on there.</span><br /><br /><span style="color: blue; font-size: x-small;">- The Baxter and Scientific Protein Laboratories CEOs did not seem aware of where they got the heparin on which the Baxter International label was eventually affixed. But one report in the New York Times alleged that Scientific Protein Laboratories would not pay enough for heparin to satisfy any sources other than the small "workshops."</span><br /><span style="font-size: x-small;"><br /><span style="color: blue;"></span></span><br /><span style="color: blue; font-size: x-small;">- Leaders of all organizations involved, Baxter International, Scientific Protein Laboratories, Changzhou SPL, the Chinese government, and the US Food and Drug Administration, and the US Congress assigned blame to each other, but none took individual or organizational responsibility. (See post </span><a href="http://hcrenewal.blogspot.com/2008/05/blaming-some-dude-for-contaminated.html"><span style="color: blue; font-size: x-small;">here</span></a><span style="color: blue; font-size: x-small;">.)  Note that SPL was recently bought out and taken private, making its current leadership even less transparent (see post </span><a href="http://hcrenewal.blogspot.com/2010/10/more-contaminated-heparin-but-who-leads.html"><span style="color: blue; font-size: x-small;">here</span></a><span style="color: blue; font-size: x-small;">).  A 2010 inspection of an SPL facility by the FDA revealed ongoing manufacturing problems (see post </span><a href="http://hcrenewal.blogspot.com/2011/02/fda-to-scientific-protein-laboratories.html"><span style="color: blue; font-size: x-small;">here</span></a><span style="color: blue; font-size: x-small;">).</span><br /><br /><span style="color: blue; font-size: x-small;">- Researchers (who turned out to have financial ties to a company which is developing an anti-coagulant drug that could compete with the heparin made by Baxter International) investigated the biological mechanisms by which the contamination of the heparin lead to adverse effects, but no one investigated further how the contamination occurred, or who was responsible. (See post </span><a href="http://hcrenewal.blogspot.com/2009/08/who-investigated-case-of-deadly.html"><span style="color: blue; font-size: x-small;">here</span></a><span style="color: blue; font-size: x-small;">.)</span><br /><br /><span style="color: blue; font-size: x-small;">- Hundreds of lawsuits against Baxter have now been filed, so far without resolution. (See post </span><a href="http://hcrenewal.blogspot.com/2010/01/blog-post.html"><span style="color: blue; font-size: x-small;">here</span></a><span style="color: blue; font-size: x-small;">.)  Efforts to make documents to be used in these cases public so far have not succeeded (see post </span><a href="http://hcrenewal.blogspot.com/2010/08/proprietary-information-confidentiality.html"><span style="color: blue; font-size: x-small;">here</span></a><span style="color: blue; font-size: x-small;">).</span><br /><br /><span style="color: blue; font-size: x-small;">- A government report which attracted little attention warned of the dangers of pharmaceutical ingredients made in China and subject to virtually no oversight. (See post </span><a href="http://hcrenewal.blogspot.com/2010/04/another-echo-of-case-of-deadly-heparin.html"><span style="color: blue; font-size: x-small;">here</span></a><span style="color: blue; font-size: x-small;">.)</span><br /><br /><span style="color: blue; font-size: x-small;">-  Despite requests from the US, the Chinese government did not investigate the production of the heparin that lead to the deaths (see post </span><a href="http://hcrenewal.blogspot.com/2010/07/more-about-what-we-dont-know-about.html"><span style="color: blue; font-size: x-small;">here</span></a><span style="color: blue; font-size: x-small;">.)</span><br /><br /><span style="color: black;">Hat tip to the </span><a href="http://postscript.communitycatalyst.org/?p=2234"><span style="color: black;">Postscript blog</span></a><span style="color: black;">.</span>

Three Years Later, A Congressional Investigation of the Deadly Adulterated Heparin

Slightly more than three years ago, we first posted about the case of the deadly adulterated heparin.  (A case summary is appended to the e...

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FDA to Scientific Protein Laboratories Managerement: "We Are Concerned About Your Fundamental Understanding"

Per Ed Silverman <a href="http://www.pharmalot.com/2011/02/heparin-supplier-is-warned-again-by-the-fda/">on the Pharmalot blog</a>, we hear of new concerns about a company in the supply chain that ended up with adulterated heparin and dead patients.  Before summarizing what the blog reported, let me summarize the case again.<br /><br /><strong>Case Summary</strong><br /><br /><span style="color: blue; font-size: x-small;">- We have posted several times, recently </span><a href="http://hcrenewal.blogspot.com/2010/12/unreasonably-dangerous-heparin.html"><span style="color: blue; font-size: x-small;">here</span></a><span style="color: blue; font-size: x-small;">, about the tragic case of suddenly allergenic heparin. Although heparin, an intravenous biologic anti-coagulant, has been in use for over 70 years, serious allergic reactions to it had heretofore been rare. Starting in 2008, hundreds of such reactions, and now over 80 deaths were reported in the US after intravenous heparin infusions.All the heparin related to these events in the US was sold by Baxter International.</span><br /><span style="color: blue; font-size: x-small;">- We then learned that although the heparin carried the Baxter label, it was not really made by Baxter. The company had outsourced production of the active ingredient to a long, and ultimately mysterious supply chain. Baxter got the active ingredient from a US company, Scientific Protein Laboratories LLC, which in turn obtained it from a factory in China operated by Changzhou SPL, which in turn was owned by Scientific Protein Laboratories and by Changzhou Techpool Pharmaceutical Co. Changzhou SPL, in turn, got it from several consolidators or wholesalers, who in turn got it from numerous small, unidentified "workshops," which seemed to produce the product in often primitive and unsanitary conditions. None of the stops in the Chinese supply chain had apparently been inspected by the US Food and Drug Administration nor its Chinese counterpart.</span><br /><span style="color: blue; font-size: x-small;">- The heparin proved to have been adulterated with over-sulfated chondroitin sulfate (OSCS), and many patients who received got seriously ill or died. While there have been investigations of how the adulteration adversely affected patients, to date, there have been no publicly reported investigations of how the OSCS got into the heparin, and who should have been responsible for overseeing the purity and safety of the product. Despite the facts that clearly patients died from receiving this adulterated drug, no individual has yet suffered any negative consequence for what amounted to poisoning of patients with a brand-name but adulterated pharmaceutical product.  (For a more detailed summary of the case, look </span><a href="http://hcrenewal.blogspot.com/2010/05/more-questions-no-answers-about-case-of.html"><span style="color: blue; font-size: x-small;">here</span></a><span style="color: blue; font-size: x-small;">, and for all our posts on this topic, look </span><a href="http://hcrenewal.blogspot.com/search/label/heparin"><span style="color: blue; font-size: x-small;">here</span></a><span style="color: blue; font-size: x-small;">.)</span><br /><br /><strong>The FDA Letter</strong><br /><br />Pharmalot reported that the US Food and Drug Administration (FDA) sent a warning letter dated January 20, 2011, to Scientific Protein Laboratories LLC, and provided <a href="http://freepdfhosting.com/e89847cc8b.pdf">a link</a> to the letter.  <br /><br />The letter identified continuing serious problems with Scientific Protein Laboratories' operations:<br /><blockquote>During our July 28, 2010 - September 3, 2010, inspection of your active pharmaceutical ingredient (API) manufacturing facility, Scientific Protein Laboratories LLC, located at 700 E. Main Street, Waunakee, WI, investigators from the Food and Drug Administration (FDA) identified <em>significant deviations from Current Good Manufacturing Practice (CGMP) for the manufacture of drugs.</em> These deviations <em>cause your drugs to be adulterated</em> within the meaning of section 501(a)(2)(B) of the Federal Food, Drug, and Cosmetic Act (the Act) [21 U.S.C. § 351(a)(2)(B)] in that <em>the methods used in, or the facilities or controls used for, their manufacture, processing, packing, or holding do not conform to, or are not operated or administered in conformity with CGMP</em>.</blockquote><br />The firm failed to adequately respond to complaints about its products, including heparin:<br /><blockquote>Failure to investigate all quality related complaints whether received orally or in writing according to a written procedure.<br /><br />For example, your firm <em>failed to conduct a formal investigation concerning a complaint identifying potential contamination with Oversulfated Chondroitin Sulfate (OSCS)</em> in a lot of Heparin Sodium USP (lot 1035-0778) on October 9, 2008. Your firm <em>did not initiate a formal investigation until September 9, 2009.</em> In addition, at that time, your firm <em>failed to extend your investigations to other lots of Heparin Sodium USP manufactured using the same crude lot identified with OSCS contamination.</em> Your investigation <em>did not consider the other lot of Heparin Sodium USP that was associated with the same contaminated crude lot until May 26, 2010, eight months after initiating a formal investigation </em>(i.e., lot 1035-0780, which tested negative for OSCS in June 2010). We acknowledge that you initiated a voluntary recall of Heparin Sodium USP that included lots 1035-0778 and 1035-0780 on October 13, 2010.<br /><br />In your response, your firm notes that you have revised your procedure to state, “Any SPL employee will inform QA of a customer complaint.” However, this response does not address the fundamental issues that allowed the delays in communications and investigation to occur. <em>Your handling of the heparin contamination complaint suggests the need to evaluate training across all departments about the types of information requiring prompt reporting to the quality unit</em>. Further, your response <em>does not address how you will ensure that complaint investigations are handled in a timely manner.</em></blockquote><br />Also, the firm still had problems overseeing the work of companies that supplied it:<br /><blockquote>Your firm <em>failed to properly evaluate a contract laboratory to ensure GMP compliance of operations occurring at the contract site</em></blockquote><br />Furthermore, it did not use the proper equipment:<br /><blockquote><em>Failure to have equipment for the manufacture of APIs of appropriate design for its intended use.</em></blockquote><br />The FDA seemed concerned that company management did not understand its responsibilities:<br /><blockquote>The manner in which you addressed this problem [the contamination of the heparin] is <em>very worrisome with respect to the timeliness of the investigation, the identification of all potentially affected drugs, and implementing appropriate actions to resolve these issues. <strong>Be advised that your firm has the responsibility to ensure the quality, safety, and integrity of its drugs</strong>.</em> FDA expects that your corporate management will immediately undertake a comprehensive evaluation of your quality system to ensure comprehensive compliance with CGMP.</blockquote><br />In addition,<br /><blockquote>However, we are <em><strong>concerned about your firm’s fundamental understanding</strong> of what is required by your Quality Unit and the regulatory expectations for a firm that enters into agreements with contract testing laboratories</em>. Although you have agreements with other firms that may delineate specific responsibilities to each party, <em>you are ultimately responsible for the quality of your products and the reliability of test results. Regardless of who tests your products or the agreements in place, you are required to manufacture these products in accordance with section 501(a)(2)(B) of the Act to assure their identity, strength, quality, purity, and safety.</em></blockquote><strong>Summary</strong><br /><br />In previous discussions of the case of the adulterated heparin I speculated about reasons that the current leaders of health care corporations may have abandoned their most fundamental responsibilities, <a href="http://hcrenewal.blogspot.com/2010/12/unreasonably-dangerous-heparin.html">for example</a>:<br /><blockquote>I submit that corporate cultures increasingly influenced by the arrogant, greedy, amoral leadership of the financial services industry that lead us to the brink of another depression are also leading us to the brink of a poisonous era in health care. Corporate leaders intent on cutting costs, and paying themselves as much of the resulting proceeds as possible, may see quality and safety as just another cost cutting target. Corporate leaders brought up in the culture of finance, but untrained and inexperienced in engineering, science, and medicine find it all too easy to ignore quality and safety and focus on the bottom line. </blockquote><br />The FDA letter to Scientific Protein Laboratories seems to confirm my fear that leaders of health care corporations no longer seem to understand their most elementary responsibilities for providing safe products, in this case, pure, unadulterated drugs. It did not speak to why that may be the case, but certainly does not contradict my theory above. <br /><br />The letter provides some reassurance that the FDA, at least, has not forgotten the case of the adulterated heparin. However, despite the number of deaths involved, this case has been relatively <a href="http://hcrenewal.blogspot.com/search/label/anechoic%20effect">anechoic</a>, and never fully investigated.<br /><br />So here I go again: as long as the leaders of health care organizations are not held accountable for the results of their decisions on health care quality, cost, and access (even in such extreme quality violations as those resulting in multiple patient deaths), we can expect continuing decisions that sacrifice quality, increase costs, and worsen access, but that are in the self-interest of the people making them.<br /><br /><br />To really reform health care, we must hold health care organizations and their leaders accountable (and not blame all the problems on doctors, other health care professionals, patients, and society at large).

FDA to Scientific Protein Laboratories Managerement: "We Are Concerned About Your Fundamental Understanding"

Per Ed Silverman on the Pharmalot blog , we hear of new concerns about a company in the supply chain that ended up with adulterated heparin ...

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"Unreasonably Dangerous" Heparin

It is time for an update on the case of the deadly contaminated heparin sold by Baxter International, which has received much less attention than seems warranted given its human costs (81 lives).  How the heparin was contaminated, and how the contaminated heparin ended up being sold as a US Food and Drug Administration approved American product are still unknown.  Despite the fact that the outcome of this case were so bad, it received disproportionately little attention when it was first made public, and now seems to have become nearly anechoic.<br /><br /><strong>Case Summary </strong><br /><br />Baxter International imported the "active pharmaceutical ingredient" (API) of heparin, that is, in plainer language, the drug itself, from China. That API was then sold, with some minor processing, as a Baxter International product with a Baxter International label. The drug came from a sketchy supply chain that Baxter did not directly supervise, apparently originating in small "workshops" operating under primitive and unsanitary conditions without any meaningful inspection or supervision by the company, the Chinese government, or the FDA. The heparin proved to have been adulterated with over-sulfated chondroitin sulfate (OSCS), and many patients who received got seriously ill or died. While there have been investigations of how the adulteration adversely affected patients, to date, there have been no publicly reported investigations of how the OSCS got into the heparin, and who should have been responsible for overseeing the purity and safety of the product. Despite the facts that clearly patients died from receiving this adulterated drug, no individual has yet suffered any negative consequence for what amounted to poisoning of patients with a brand-name but adulterated pharmaceutical product.  (For a more detailed summary of the case, look <a href="http://hcrenewal.blogspot.com/2010/05/more-questions-no-answers-about-case-of.html">here</a>, and for all our posts on this topic, look <a href="http://hcrenewal.blogspot.com/search/label/heparin">here</a>.)<br /><br /><strong>Civil Cases Plod Forward</strong><br />If there is any ongoing official investigation of this case, it has not been made public.  Civil cases filed by patients allegedly injured by the heparin, or by relatives of patients who died allegedly from the heparin, seem to be proceeding at a glacial pace.  However, there is one development in one set of civil cases worthy of note.  As <a href="http://online.wsj.com/article/SB10001424052748703374304575623013312191090.html">reported</a> two weeks ago by Alicia Mundy in the Wall Street Journal:<br /><blockquote>A state court in Illinois has granted a partial summary judgment to two plaintiffs suing Baxter International Inc. over contaminated blood thinner, saying that <em>some of the company's heparin was 'unreasonably dangerous.' </em><br /><br />The suit involves tainted imported heparin ingredients from China that caused a public health crisis in 2008, and were linked to more than 80 deaths in the U.S. and many other serious allergic reactions. <br /><br />Some 300 cases nationwide against Baxter and its main ingredient supplier, Wisconsin-based Scientific Protein Laboratories LLC, were consolidated in Chicago in Cook County Circuit Court.<br /><br />Both companies have said that they weren't negligent and weren't responsible for the deadly reactions among patients.<br /><br />The Illinois judge's ruling, dated Wednesday, involved a motion for partial summary judgment that named only Baxter. The motion was filed on behalf of two plaintiffs in the consolidated cases, one of whom died.<br /><br />The ruling cites statements by Baxter's corporate quality vice president and the president of the company's medication delivery division that the heparin was defective. <br /><br />Baxter argued in its defense that a jury should address the question of whether a product is 'unreasonably dangerous.' <em>The company noted that the two Baxter executives who agreed in depositions that the heparin was defective aren't doctors or scientists</em>. However, Judge Jennifer Duncan-Brice wrote that the issue before her wasn't whether heparin actually caused the death or injury to the plaintiffs, but <em>just whether the product was, as a matter of fact, contaminated. </em></blockquote>The most basic responsibility of a pharmaceutical company is to produce pure, unadulterated product.  As the current director of the US Food and Drug Administration <a href="http://healthpolicyandreform.nejm.org/?p=13270">wrote</a> in this week's New England Journal of Medicine, the agency's "modern regulatory functions began with the passage of the 1906 Pure Food and Drugs Act, a law, more than a quarter of a century in the making, that prohibited interstate commerce in adulterated and misbranded food and drugs."  However, in the 21st century, drug companies are increasingly failing to produce unadulterated products, and the FDA is having increasing difficulty assuring patients that the drugs they take meet even the most basic safety standards.  <br /><br />I submit that corporate cultures increasingly influenced by the arrogant, greedy, amoral leadership of the financial services industry that lead us to the brink of another depression are also leading us to the brink of a poisonous era in health care.  Corporate leaders intent on cutting costs, and paying themselves as much of the resulting proceeds as possible, may see quality and safety as just another cost cutting target.  Corporate leaders brought up in the culture of finance, but untrained and inexperienced in engineering, science, and medicine find it all too easy to ignore quality and safety and focus on the bottom line.  (It is ironic that in the quote above, Baxter International's attorneys made light of the judgments of the company's own executives because they are not physicians or scientists.)<br /><br />Meanwhile, society seems to have been so mesmerized by the mantra that laissez faire capitalism will lead to miraculous "innovation" that we do not even attend to instances in which it lead instead to death.<br /><br />As we have said until being blue in the face, as long as the leaders of health care organizations are not held accountable for the results of their decisions on health care quality, cost, and access (even in such extreme quality violations as those resulting in multiple patient deaths), we can expect continuing decisions that sacrifice quality, increase costs, and worsen access, but that are in the self-interest of the people making them.<br /><br /><br />To really reform health care, we must hold health care organizations and their leaders accountable (and not blame all the problems on doctors, other health care professionals, patients, and society at large).

"Unreasonably Dangerous" Heparin

It is time for an update on the case of the deadly contaminated heparin sold by Baxter International, which has received much less attention...

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More Contaminated Heparin, But Who Leads the Company Who Supplied It?

We have posted multiple times over the last two years about the deadly contaminated heparin from China. (See the case summary and link at the end of this post.) <br /><br />One of the key players in this case was a company called Scientific Protein Laboratories (SPL). The company that sold the heparin in the US under its logo, Baxter International, had outsourced production of the active ingredient to a long, and ultimately mysterious supply chain. Baxter got the active ingredient from Scientific Protein Laboratories, which in turn obtained it from a factory in China operated by Changzhou SPL, which in turn was owned by Scientific Protein Laboratories and by Changzhou Techpool Pharmaceutical Co. Changzhou SPL, in turn, got it from several consolidators or wholesalers, who in turn got it from numerous small, unidentified "workshops," which seemed to produce the product in often primitive and unsanitary conditions. None of the stops in the Chinese supply chain had apparently been inspected by the US Food and Drug Administration nor its Chinese counterpart.<br /><br /><strong>Even More Contaminated Heparin?</strong><br /><br />Now it looks like SPL may have sold contaminated heparin elsewhere, after the above story of the contaminated heparin sold by Baxter became public, as <a href="http://online.wsj.com/article/SB10001424052748704763904575550490003088252.html">reported</a> by Alicia Mundy in the Wall Street Journal:<br /><blockquote>A major U.S. heparin wholesaler received a complaint from a corporate customer about a <em>contaminated batch of blood thinner</em> in October 2008, but didn't investigate for almost a year, according to a recent Food and Drug Administration notice to the company.<br /><br /><em>Scientific Protein Laboratories LLC got the customer complaint months after the FDA announced nationwide recalls of many heparin products</em>.</blockquote><br />In more detail,<br /><blockquote>In a report last month, reviewed by The Wall Street Journal, the FDA told SPL that it<em> 'did not adequately investigate a complaint that affected product quality.' The report said SPL didn't begin a probe of the contamination complaint until September 2009, and failed to investigate 'other lots of heparin that may have been associated with the complaint.'</em><br /><br />The FDA said Wednesday it cited SPL for 'violations of current good manufacturing practice' and is still investigating. 'FDA believes the issue does not present a significant public-health risk,' it said. An FDA spokeswoman said the batch in question never reached patients.<br /><br />After SPL looked into the October 2008 complaint, it found that the contaminated raw material was used in two processed batches of heparin , the FDA report said. SPL ended its review of one batch in June 2010. It didn't investigate the second, the FDA said.</blockquote><br />It looked like this instance of contaminated heparin did not pose a public health hazard because the company to whom it was shipped, possibly alerted by the case above, tested and rejected the SPL heparin<br /><blockquote>SPL said Wednesday <em>the heparin lots in question 'passed all the then-required, state-of-the-art testing' to detect contamination</em>, however <em>trace amounts of contaminant, oversulfated chrondroitin sulfate, were found by a customer using their own specialized testing</em>. The company also said no adverse events were reported involving the batch in question. [Ed - apparently because the buyer realized the problem and never used the batch in its products that were provided to the public.]</blockquote><br />So even after the whole problem of oversulfated chrondroitin sulfate contaminated heparin had become a public scandal, the company that passed along the heparin that became subject of that scandal had "state-of-the-art testing" that could not adequately detect that specific contaminant, although the company to whom it sold the heparin apparently was able to test for it. <br /><br />Providing pure, unadulterated products is the most elementary responsibility of drug companies. The US Food and Drug Administration was set up mainly to ensure the purity of drugs (and only later, to ensure their effectiveness and then safety). Yet some US companies have proven unable to assure the purity of their products. (For another prominent case, go <a href="http://hcrenewal.blogspot.com/2010/09/should-president-of-university-of.html">here</a>.)  Now we have an instance in which a company still seemed unable to check their products for impurities even after they knew dangerous impurities could be present and had been present in other batches of the products they sold, and even after other companies had figured out how to perform such checks. <br /><br />As we have said before, seemingly infinitum, if we want a health care system that provides good quality, affordable, accessible care, we need health care leaders who put the wellbeing of patients ahead of their own pocketbooks, and to hold them accountable for doing so.<br /><br /><strong>Holding Leaders Accountable, If Only One Could Find Them</strong><br /><br />By the way, this case further illustrates how far from that ideal we are, because it is not even obvious who the leaders of SPL who ought to be held so accountable actually are.  The <a href="http://www.spl-pharma.com/index.htm">SPL web-site</a> says nothing about corporate governance or leadership.  <br /><br />After some Google searching, it turns out that the reason for this is that SPL was<a href="http://ir.americancapital.com/phoenix.zhtml?c=109982&p=irol-newsArticle&ID=1320964&highlight="> bought out</a> by private equity firm American Capital Strategies Ltd in 2006, two years before the contaminated heparin scandal became manifest.  Although American Capital Strategies Ltd is publicly traded, its <a href="http://services.corporate-ir.net/SEC/Document.Service?id=P3VybD1odHRwOi8vaXIuaW50Lndlc3RsYXdidXNpbmVzcy5jb20vZG9jdW1lbnQvdjEvMDAwMTE5MzEyNS0xMC0xODEwMjMvZG9jL0FtZXJpY2FuQ2FwaXRhbExURF9ERUYxNEFfMjAxMDA4MDYucGRmJnR5cGU9MiZmbj1BbWVyaWNhbkNhcGl0YWxMVERfREVGMTRBXzIwMTAwODA2LnBkZg==">2010 proxy statement</a> and most recent publicly available <a href="http://phx.corporate-ir.net/External.File?item=UGFyZW50SUQ9MzQ2ODEwfENoaWxkSUQ9MzM0ODYzfFR5cGU9MQ==&t=1">annual report</a> (of 2008) say almost nothing about SPL.  Private equity firms are known for acquiring troubled companies and trying to turn quick profits from them, often from stringent cost-cutting and selling off assets.  They are not particularly known for their devotion to better patient care.  None of the top executives and directors of American Capital Strategies Ltd seem to have health care backgrounds or experience or any other reason to sympathize with the core values of health care professionals. <br /><br />Further Google searching did suggest that the CEO of SPL is one <a href="http://www.linkedin.com/pub/david-strunce/12/366/707">David G Strunce</a>, but revealed little biographical information about him.  How he and other executives of that company might better be held accountable is not obvious.<br /><br />So what will it take to get the leaders of pharmaceutical companies to take their responsibility to provide pure, unadulterated drugs more seriously? How will society be able to better hold those leaders accountable?  How can we get leaders of health care to put the health of the people ahead of their own financial returns?  <br /><br />The case of the adulterated heparin suggests these questions will not be easily answered.<br /><br /><strong>Case Summary</strong><br /><br /><span style="font-size: x-small;">In summary, Baxter International imported the "active pharmaceutical ingredient" (API) of heparin, that is, in plainer language, the drug itself, from China. That API was then sold, with some minor processing, as a Baxter International product with a Baxter International label. The drug came from a sketchy supply chain that Baxter did not directly supervise, apparently originating in small "workshops" operating under primitive and unsanitary conditions without any meaningful inspection or supervision by the company, the Chinese government, or the FDA. The heparin proved to have been adulterated with over-sulfated chondroitin sulfate (OSCS), and many patients who received got seriously ill or died. While there have been investigations of how the adulteration adversely affected patients, to date, there have been no publicly reported investigations of how the OSCS got into the heparin, and who should have been responsible for overseeing the purity and safety of the product. Despite the facts that clearly patients died from receiving this adulterated drug, no individual has yet suffered any negative consequence for what amounted to poisoning of patients with a brand-name but adulterated pharmaceutical product.</span><br /><span style="font-size: x-small;"></span><br /><span style="font-size: x-small;"><br /></span><br /><span style="font-size: x-small;">(For a more detailed summary of the case, look </span><a href="http://hcrenewal.blogspot.com/2010/05/more-questions-no-answers-about-case-of.html"><span style="font-size: x-small;">here</span></a><span style="font-size: x-small;">.)</span>

More Contaminated Heparin, But Who Leads the Company Who Supplied It?

We have posted multiple times over the last two years about the deadly contaminated heparin from China. (See the case summary and link at th...

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"Proprietary Information," Confidentiality Motions, and the Anechoic Effect; the Case of the Contaminated Heparin

The case of the deadly contaminated heparin sold by Baxter International has received much less attention than seems warranted given its human costs (81 lives).  How the heparin was contaminated, and how the contaminated heparin ended up being sold as a US Food and Drug Administration approved American product are still unknown.  Our most recent post, <a href="http://hcrenewal.blogspot.com/2010/07/more-about-what-we-dont-know-about.html">here</a>, noted that an investigation into the contamination of the active pharmaceutical ingredient (API - actually the heparin itself) in China failed to produce any results, apparently because the Chinese government did not see fit to pursue it.  (Note that a brief summary of the whole case is at the end of this post.)<br />Now a new <a href="http://online.wsj.com/article/SB10001424052748704868604575433960537183170.html">story</a> in the Wall Street Journal by Alicia Mundy explains even more about why we do not know more about the contaminated heparin:<br /><blockquote>Baxter International Inc. faces a new challenge in federal court in <em>its bid to block disclosure of documents about the 2008 contaminated-heparin crisis</em>.<br /><br />Baxter and Scientific Protein Laboratories LLC are fighting a civil mass tort lawsuit alleging deaths and injuries from imported Chinese heparin in 2007 and 2008. A company that isn't party to that lawsuit says <em>some of the information Baxter and SPL want to keep confidential is important to public health and drug safety, and could reveal information about the sources of toxic heparin in the Chinese supply chain</em>.<br /><br /><em>The two companies want to keep under seal portions of depositions taken in the case, including those related to Momenta Pharmaceuticals Inc., which helped the U.S. government investigate the contamination. Baxter and SPL say they will be hurt if forced to disclose proprietary information</em>.<br /><br />They have denied that they were negligent in the deaths linked to the blood-thinning drug, widely used in cardiovascular and other conditions. </blockquote><br />So,<br /><blockquote>On Aug. 3, federal Judge James Carr in Toledo, Ohio, <em>ruled in favor of the confidentiality motion by Baxter and SPL.</em></blockquote><br />On the other hand, there are arguments, admittedly by parties with relevant financial interests, for making more information public:<br /><blockquote>Last Friday, another company entered the fray, contending that the information in the depositions shouldn't be sealed. Amphastar Pharmaceuticals Inc. said public health could benefit if the depositions shed light on circumstances in China.<br /><br />Amphastar, which has been competing with Momenta for approval to make a newer and more expensive form of heparin, said <em>the information is also important to a congressional investigation into the Food and Drug Administration's handling of the heparin crisis</em>. Republican leaders of a House committee say the FDA failed to trace the contamination in the Chinese heparin supply chain.<br /><br />On July 23, the FDA granted approval to Momenta to make the special heparin called enoxaparin, while Amphastar's application remains on hold. <br /><br />Amphastar said in its court filing that the 'serious safety concerns' involving heparin are relevant to enoxaparin because heparin is the starting material of enoxaparin's active ingredient. Most U.S. heparin supplies come from China.</blockquote><br />Of course, the companies who want to keep as much about the case secret as they can are not talking about it:<br /><blockquote>Lawyers for Baxter and SPL declined to comment on their efforts to restrict information related to Momenta. They referred inquiries to Baxter, whose spokeswoman declined to comment.</blockquote><br />So here is more about what we do not know about the deadly contaminated heparin from China. One reason that this case has remained so <a href="http://hcrenewal.blogspot.com/search/label/anechoic%20effect">anechoic</a> is that the companies that sold and processed the contaminated heparin, and are now defendants in lawsuits have used that situation as a rationale for keeping "proprietary" information secret.  There clearly may be reasons that Baxter International, the company that sold the heparin under their (formerly?) prestigious US label  wants to keep secret the details about what efforts it did or did not make to assure that the heparin it sold was pure and unadulterated. There clearly also may be reasons that Scientific Protein Laboratories LLC, the US based company that sold the heparin API to Baxter wants to keep secret the details about what efforts it did or did not make to assure that the heparin API was pure and unadulterated.  <br /><br />The ability of participants in lawsuits to keep "proprietary" information secret clearly adds to the <a href="http://hcrenewal.blogspot.com/search/label/anechoic%20effect">anechoic effect</a>.  Ironically, it may be that civil legal action, which is sometimes the only way to impose negative consequences on health care organizations that have misbehaved, may have the adverse effect of further hiding information about the events in question.  <br /><br />However, to promote the safety of individual patients and the health of public, and to prevent another deadly case of drug contamination, understanding details about what happened is absolutely vital. The private pecuniary interests of Baxter International and Scientific Protein Laboratories LLC seem to be directly opposite to those of patients, physicians, and the public at large in this case. It is therefore disquieting to learn that the companies' wishes to keep information they declare is "proprietary" seem to have trumped individual patient safety and public health concerns. (Note that these concerns go beyond the commercial concerns of Amphastar Pharmaceutical, although in this case the pecuniary interests of that company do not seem to be opposed to patient safety and the public health.)<br /><br />If we really want a health care system that improves the health of individuals and the public, we need it to put health and safety concerns ahead of the incomes of health care corporations.  That such a statement seems not a platitude, but revolutionary is a mark of how our health care system has been turned on its head. <br /><br /><strong><span style="font-size: x-small;">Case Summary</span></strong><br /><span style="font-size: x-small;"><br /></span><br /><span style="font-size: x-small;">In summary, Baxter International imported the "active pharmaceutical ingredient" (API) of heparin, that is, in plainer language, the drug itself, from China. That API was then sold, with some minor processing, as a Baxter International product with a Baxter International label. The drug came from a sketchy supply chain that Baxter did not directly supervise, apparently originating in small "workshops" operating under primitive and unsanitary conditions without any meaningful inspection or supervision by the company, the Chinese government, or the FDA. The heparin proved to have been adulterated with over-sulfated chondroitin sulfate (OSCS), and many patients who received got seriously ill or died. While there have been investigations of how the adulteration adversely affected patients, to date, there have been no publicly reported investigations of how the OSCS got into the heparin, and who should have been responsible for overseeing the purity and safety of the product. Despite the facts that clearly patients died from receiving this adulterated drug, no individual has yet suffered any negative consequence for what amounted to poisoning of patients with a brand-name but adulterated pharmaceutical product.</span><br /><span style="font-size: x-small;"><br /></span><br /><span style="font-size: x-small;">(For a more detailed summary of the case, look </span><a href="http://hcrenewal.blogspot.com/2010/05/more-questions-no-answers-about-case-of.html"><span style="font-size: x-small;">here</span></a><span style="font-size: x-small;">.)</span>

"Proprietary Information," Confidentiality Motions, and the Anechoic Effect; the Case of the Contaminated Heparin

The case of the deadly contaminated heparin sold by Baxter International has received much less attention than seems warranted given its hum...

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