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Former McKesson CEO and Board Chairman Convicted of Fraud

Continuing with our annals of health care crime, Bloomberg.com <a href="http://www.bloomberg.com/apps/news?pid=20601103&sid=aU0Sd1_0uEjk">reported</a> a new verdict on a very old case: <blockquote>Former McKesson Corp. Chairman Charles McCall was convicted in a second trial of participating in a fraud 10 years ago that cost investors $8.6 billion, one of the largest white-collar crimes at the time. A federal jury in San Francisco yesterday found McCall guilty of five of six counts of securities fraud and circumventing accounting rules. He was acquitted of falsifying records. Sentencing is set for March 2. Ex-McKesson General Counsel Jay Lapine was found not guilty of three charges. McCall and Lapine were accused of hiding backdated sales contracts from auditors and other conduct that improperly inflated revenue figures at San Francisco-based McKesson, the biggest U.S. drug distributor, and HBO & Co., a software maker led by McCall that was acquired by McKesson in 1999. The McCall verdict was a victory for prosecutors who lost a 2006 trial of the ex-chairman. Assistant U.S. Attorney David Anderson told jurors in the three-week trial that McCall learned of the practices a few months before HBO was to be acquired. Instead of blowing the whistle, McCall covered up the fraud and was named chairman of the merged company, Anderson said. When McKesson disclosed in April 1999 that sales had been prematurely booked, leading to a restatement, the shares lost 47 percent of their value. McCall and Lapine were fired that year. A federal investigation followed, and five former McKesson executives pleaded guilty. McCall and Lapine were indicted in 2003. McKesson, which wasn’t named in the U.S. criminal cases, agreed to pay $960 million in 2005 to settle investor lawsuits. </blockquote> On Health Care Renewal, we often seem to get caught up in the details of the moment. This case is a reminder that the problems we have been discussing have been going on for a long time, certainly long before we started to use the new-fangled medium of a blog to write about them. The case also is a rare example of health care leaders actually suffering negative consequences for bad behavior.  We have noted many examples (see some <a href="http://hcrenewal.blogspot.com/search/label/legal%20settlements">here</a>) in which bad behavior by health care organizations results only in a penalty for the organization as a whole, whose impact may be diffused among employees, stock-holders, and customers or clients.  Those who authorized, directed, or implemented the behavior often suffer no negative consequences.  In the current case, some of the responsible leaders have already paid a penalty, and now the most senior responsible leader also appears to be on the verge of also paying a penalty.  On the other hand, it took 10 years from the time the bad behavior was recognized for the penalty to be decided.  Meanwhile, Mr McCall likely continued to enjoy the wealth he had amassed in his position of leadership.  The <a href="http://www.sec.gov/Archives/edgar/data/927653/0000929624-99-001275.txt">1999 McKesson HBOC proxy statement</a>, which included a statement that McCall was forced to resign his positions as Chairman of the Board and employee, noted that Mr McCall had already received a salary and bonus of greater than $2 million (in 1999 dollars) that year, and was the proud possessor of 2,879,677 shares of common stock, more than 1% of shares outstanding, after his resignation.  I say again, meaningful health care reform is unlikely unless we deal with the problem of conflicted, unethical, and sometimes corrupt leadership of health care organizations.

Former McKesson CEO and Board Chairman Convicted of Fraud

Continuing with our annals of health care crime, Bloomberg.com reported a new verdict on a very old case: Former McKesson Corp. Chairman Ch...

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Aetna Government Contract Discredited

Last week, the Sacramento Business Journal <a href="http://sacramento.bizjournals.com/sacramento/stories/2009/11/16/daily37.html">reported</a> on irregularities in how health insurance/ managed care giant Aetna obtained a contract with the US military health plan Tricare: <blockquote>Aetna Inc. hired a former high-level Tricare employee with access to proprietary information about Health Net Inc.’s performance that could have given Aetna a competitive edge in its bid for a lucrative military health care contract, the U.S. Government Accountability Office has concluded. The GAO details six flaws in the procurement process in new documents posted online Tuesday and recommends that Aetna should be excluded from the competition, leaving Health Net 'as the only viable awardee.' The agency recommends Tricare officials perform a thorough review of what sensitive information the former Tricare employee had access to and decide what action to take to address the problem. The GAO also recommends that Health Net be reimbursed the cost of filing the protest, including attorneys fees. </blockquote> The Business Journal described the details of the irregularities: <blockquote>The GAO decision pointed to six flaws in the in the bid evaluation process, including: * The agency credited Aetna with past performance of its parent and corporate affiliates but did not record which entities were involved or establish the roles they would play in the contract * The evaluation gave Aetna the highest past performance rating without considering that its past performance was small compared with the size of the Tricare contract * The price evaluation did not consider whether Aetna’s proposed staffing reflected a lack of understanding of the technical requirements of the contract — or showed a willingness to take a risk on the business * The agency failed to consider the risk involved with Aetna’s proposed plan to hire large percentages of Health Net’s work force at lower pay rates * The agency did not consider Health Net’s network provider discounts when assessing its pricing information for the program and * The agency failed to protest Aetna’s hiring a former Tricare official with inside knowledge of Health Net’s performance on the previous contract. 'The contracting officer never considered the matter — because the awardee did not bring it to his attention— and the record shows that the individual had access to non-public proprietary information,' the decision states. </blockquote> The Montgomery Advertiser <a href="http://www.montgomeryadvertiser.com/article/20091122/NEWS02/91122011/1009/Errors-ethics-issues-surface-in-Aetna-TRICARE-contract">added</a>: <blockquote>Though it doesn’t allege that procurement integrity law was broken, the GAO said contracting agencies like TMA have an obligation 'to avoid even the appearance of impropriety' in government procurement. This time it failed. </blockquote> It's been only about nine months since we discussed legal or regulatory issues for Aetna.  In February, 2009 we <a href="http://hcrenewal.blogspot.com/2009/02/aetna-settles.html">discussed</a> its settlement of accusations it underpaid claims in part through its use of a now discredited database marketed by Ingenix, a subsidiary of its supposed competitor, UnitedHealth Group. Aetna <a href="http://www.aetna.com/about-aetna-insurance/index.html">boasts</a> that it is <blockquote>Helping to manage health care, one of the most important things in life We believe we can help create a better health care system. This belief drives our daily decisions as one of the nation's leading health care benefits companies. We work hard to provide our members with information and resources to help them make informed decisions about their health. </blockquote> Furthemore, it boasts of its mission <blockquote>We help people achieve health and financial security by providing easy access to cost-effective, high-quality health care. And we continue to be a leader in building a stronger, more effective health care system by working with doctors, hospitals, employers, patients, public officials and others. </blockquote> It seems one way in which Aetna works with public officials is to hire those that might have some inside knowledge of specific government contracting processes, and then take advantage of that to boost their chances of obtaining lucrative contracts, if I am reading the summary of the GAO findings correctly.  Maybe most people have grown cynical about health care organizations', especially commercial health care insurance companies' mission statements, and may dismiss them as marketing fluff, if not complete balderdash.  However, to improve health care quality while controlling costs, facilitating access, and restoring professionalism, would be health care reformers need to make health care organizational leaders live up to their noble-sounding proclamations of corporate social responsibility.

Aetna Government Contract Discredited

Last week, the Sacramento Business Journal reported on irregularities in how health insurance/ managed care giant Aetna obtained a contract...

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Genzyme's "Remarkable Business'Strategy" and Contaminated Drugs

In June, 2009, <a href="http://www.boston.com/news/world/latinamerica/articles/2009/06/14/one_girls_hope_a_nations_dilemma/">an article</a> in the Boston Globe described how the Boston area based biotechnology company Genzyme sold some astonishlingly expensive drugs, using <blockquote>a remarkable business strategy: In countries from Colombia to Taiwan to Libya, the Cambridge firm has compiled an extraordinary track record of searching out patients like Tania, providing desperately needed treatment, and then successfully pressing their governments, even poor ones, to pay full price for the most expensive drugs in the world. </blockquote> The article focused on how Genzyme marketed Cerezyme for Gaucher's disease. <blockquote>When Genzyme Corp. first introduced a bioengineered drug for Gaucher (pronounced GO-shay) disease in the 1990s, the very idea seemed almost absurd to most people in the pharmaceutical industry. It was expensive to manufacture, there were vanishingly few known patients, and it wasn't clear how you could sell enough of it to recoup research costs, never mind make a profit. Genzyme's solution, elegant in its way, was to set a price high enough to earn a substantial profit no matter how small its pool of patients. Then the company surprised the medical world - and its investors on Wall Street - by showing that American health insurers could be persuaded to pay the six-figure price tag. And with the only effective treatment for Gaucher disease, Genzyme never needed to lower the price, even as production efficiencies raised profit margins on the drug to as much as 90 percent. The drug started to bring in tens of millions of dollars a year, then hundreds of millions. Today this one drug, prescribed for about 5,000 patients, has transformed Genzyme and its chief executive, Henri Termeer, into one of the great success stories of biotechnology, fueling its expansion into a $16 billion company with offices and factories worldwide. By the early 2000s, Genzyme had reached most of the known Gaucher patients in the United States, so it had begun pushing outward to new markets. Genzyme created divisions within the company to find overseas patients; it hired experts to cajole balky governments into paying for the patients' Cerezyme doses. Some of the company's successes were extraordinary: hundreds of patients in Brazil. Patients in Taiwan, Kuwait, and Bulgaria. The government of Libya's Colonel Moammar Khadafy pays for Cerezyme for a handful of patients. As it notched these successes, the company stayed largely under the radar of public health activists who were pushing drugmakers to discount AIDS drugs and other lifesaving medications whose retail prices were financially out of reach to many governments. Biotechnology drugs like Genzyme's, though crushingly expensive for each patient, were so rarely prescribed that they did not attract the same attention, and Genzyme followed an extremely disciplined 'one price' strategy: find patients; donate the drug at first if necessary, but press constantly to be paid full retail price. </blockquote> The "one price" for Cerezyme in Costa Rica was $160,000 per year of therapy. I thought about posting about this story when it came out, focusing, of course, on the amazing price of Cerezyme. However, then I wondered: while the price of Cerezyme seemed extremely high, could anyone say that it was outrageously and unfairly high? After all, the drug was expensive to develop and produce, could not be sold in volume, and provided apparently very effective treatment for an otherwise untreatable disease. So I put the article in a file, and did not post about it. Then a few days later, <a href="http://www.boston.com/business/healthcare/articles/2009/06/17/genzyme_temporarily_halts_production_on_2_key_drugs/">another story</a> ran in the Globe, this time about problems in the Genzyme plant that produces Cerezyme: <blockquote>n an unprecedented move for Genzyme Corp., the state’s largest biotechnology company has halted production of two drugs for rare genetic disorders after a virus was discovered in production equipment at its Allston plant. The drugs are used by 8,000 people worldwide and cost about $200,000 per patient annually. While the virus has the ability to taint the drugs, it is not considered harmful to humans, officials said. The manufacturing plant will remain shut through July while it is decontaminated as a precaution. Shipments of the drugs, Cerezyme and Fabrazyme, have been put on hold while the US Food and Drug Administration seeks assurance from the company that none of its inventory is compromised. Genzyme officials believe the inventory was not affected. The current supply will need to be rationed, Genzyme said. </blockquote> My first thought was that if Genzyme can charge so much for Cerezyme, at least it ought to be able to afford a pristine production process. On the other hand, I also realized that manufacturing processes in biotechnology are complex and difficult, perfection is not always possible, and the contamination in question did not appear harmful. So I put this article in the file too, and did not post about it either. Four days ago, the Boston Globe <a href="http://www.boston.com/yourtown/framingham/articles/2009/11/14/more_contamination_troubles_for_genzyme/">published yet again</a> about troubles in same manufacturing plant. <blockquote>Genzyme Corp., the Cambridge biotechnology giant that has spent five months scrambling to regain its footing after detecting a virus at its Allston plant, is facing a new contamination problem: bits of steel, rubber, and fiber found in drugs made by the company and shipped from the same site. Federal regulators yesterday warned doctors to look for foreign particles in five Genzyme drugs used to treat rare genetic disorders, including two - Cerezyme and Fabrazyme - that have been rationed because of the viral contamination detected in the Allston Landing plant last summer. The five drugs represent roughly half of Genzyme’s $4.6 billion in annual sales. Particles are believed to have been found in less than 1 percent of the Genzyme drugs based on product lots examined, according to a statement from the Food and Drug Administration. The FDA warned physicians, however, to carefully examine vials of the products and filter them before they are given to patients - steps that are considered standard procedure within the industry. If they find particles, the FDA asked for the vials to be returned to the manufacturer. The agency warned that ingesting the particles could have effects that include allergic reactions and blood clotting. FDA inspectors arrived at the Allston plant last month to begin an investigation into Genzyme’s production operations. </blockquote> In addition, a New York Times <a href="http://www.nytimes.com/2009/11/14/business/14drug.html">article</a> noted: <blockquote>'Biological manufacturing is extremely complex and prone to problems,' including contamination, said Jean-Jacques Bienaime, chief executive of BioMarin Pharmaceuticals, a biotech company that also makes drugs for rare diseases, including one it co-developed with Genzyme. Mr. Bienaime said his company always maintained at least a year’s worth of inventory in case of a production outage. But Genzyme did not have such an inventory of Cerezyme and Fabrazyme. </blockquote> Finally, today the In Vivo blog <a href="http://invivoblog.blogspot.com/2009/11/genzyme-contents-under-pressure.html">posted </a>a discussion of Genzyme's production woes which suggested that the two different types of contamination at the plant, and the failure of the company to reliably ship pure, unadulterated drug to patients were not simply the results of bad luck or failure to attain unattainable perfection. <blockquote>Friday's announcement that bits of rubber and other detritus were found in vials of five different drugs manufactured at Genzyme's beleaguered Allston Landing plant was worthy of the satirical publication "The Onion"--except that it was true. The picture grew murkier over the weekend, with the arrival of another Form 483 missive from FDA about ongoing manufacturing issues and a complete response for Lumizyme, Genzyme's enzyme replacement therapy for Pompe disease has been subject of more regulatory twists and turns than the plot of a Dan Brown novel. The origin of the problem goes back three years, to the original approval of Myozyme, basically the same drug as Lumizyme only manufactured on a much smaller scale, at a 160-liter scale facility in Framingham. Genzyme underestimated the demand for the drug, and plans to shore up capacity with a 4000-liter facility in Belgium were put in place. Only as a stop gap, the company also decided to devote 1/6th of its manufacturing capacity at Allston to the making of the drug. And that decision has proved problematic. The stress of running an aging plant full tilt meant there was no time for necessary facility upgrades that might threaten the inventory of drugs manufactured at Allston, among them Cerezyme for Gaucher disease and Fabrazyme for Fabry disease. Genzyme CEO Henri Termeer admitted as much in the Nov. 16 investor call, noting '"the introduction of the production of Myozyme in Allston was a very significant factor in the complications we have experienced there.' Too bad that realization didn't happen one year ago. That's when regulators started sending warning letters outlining concerns related to what sound like bread-and-butter manufacturing issues: microbial monitoring, equipment maintenance, and process controls. What's most amazing is that problems are ongoing. Recall that six-week interlude this summer when the firm took the entire plant offline to sterilize it after discovering yet another unrelated problem--several bioreactors contaminated with a non-lethal to humans but problematic Vesivirus. On the company's Nov. 16 call to investors, management confirmed that the latest 483 letter relates not to a new problem created by Genzyme's decontamination efforts but arising because of 'an older piece of equipment'. As Genzyme's EVP of Therapeutics, Biosurgery, and Corporate Operations said during a Q&Asession with analysts, '"There was a number of issues there that they [regulators] highlighted and many of which we were very aware of and working to address.' Management's solution? Take the plant off line again for a few weeks to, as Meeker puts it, 'allow us to move more quickly to address those issues.' Does everyone feel better now? In some strange way, the very minor nature of these gaffes is the most damning element of the story. It throws management's judgment into question and again casts doubt on the ability of the current team to resolve a situation that should never have escalated to this level. </blockquote> So now it is time to discuss Genzyme's production woes on Health Care Renewal.  For $160,000 a year, it seems reasonable to expect that patients could expect a reasonably well-thought out, conservatively planned production process that would be able to reliably produce sufficient quantities of pure, unadulterated drug.  Instead, Genzyme's "remarkable business strategy" did not seem to include adequate maintenance of production facilities with adequate capacities, or even keeping an adequate reserve supply of product in anticipation that over-working a single aging facility with aging equipment might lead to something breaking down.  By the way, for overseeing this "remarkable business strategy," Genzyme paid its CEO, Henri A Termeer, $13,773,782 in total compensation last year (per the <a href="http://www.sec.gov/Archives/edgar/data/732485/000104746909004080/a2192147zdef14a.htm">2009 proxy statement</a>).  Presumably mainly from the stock and option awards he has accumulated over the year, Mr Termeer now owns 4,080,387 shares of Genzyme stock, 1.5% of total outstanding shares.  For that money, patients, share-holders, and line employees ought to expect "remarkable business strategies" that include attention to such basics as good maintenance of production facilities.  Maybe the company's well compensated (more than $400,000 a year) directors should have been more vigilant about overseeing the management's "remarkable business strategy."  The board  included Gail K Boudreaux, an Executive Vice President of UnitedHealth Group, Charles L Cooney PhD, the Haslam Professor of Chemical and Biochemical Engineering at the Massachusetts Institute of Technology, and Dr Victor J Dzau, Chancellor of Health Affairs at Duke University and CEO of Duke University Health Systems, who seemingly have some relevant expertise, although the board also included Richard F Syron PhD, the former CEO of the Federal Home Loan Mortgage Corporation, (Freddie Mac), who resigned in 2008 after the failure of the company which was later bailed out by the US government.    So once again we see how leaders of health care organizations, in this case perhaps blinded by the prodigious amounts of money they were making, failed to exercise rigorous oversight over how their company produced its product.  The actual production part of biotechnology may seem far less glamorous than other aspects of the company.  Yet, if a drug company cannot reliably produce pure, unadulterated drugs, all its advanced research, cutting edge finance, and glitzy marketing may be for nought.  This case is another argument for finding health care corporate leaders who remember that long term success comes from putting patients, not dollars, not glitz,  first.

Genzyme's "Remarkable Business'Strategy" and Contaminated Drugs

In June, 2009, an article in the Boston Globe described how the Boston area based biotechnology company Genzyme sold some astonishlingly ex...

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Seeking NIH to fund studies on medical ethics, conflicts of interest in medicine and research, and prescribing behavior

Adriane Fugh-Berman MD is principal investigator (PI) of the <a href="http://pharmedout.org/">PharmedOut</a> project. PharmedOut is an independent, <a href="http://pharmedout.org/aboutus.htm">publicly funded</a> Georgetown University Medical Center project that educates physicians about industry influence on prescribing. project that empowers physicians to identify and counter inappropriate pharmaceutical promotion practices. PharmedOut promotes evidence-based medicine by providing news, resources, and links to pharma-free CME courses. PharmedOut is requesting that the U.S. NIH (National Institutes of Health) fund more research into ethics, conflicts of interest, and prescribing behavior. One hundred researchers, clinicians, and ethicists have signed a letter sponsored by PharmedOut asking NIH to fund research on medical ethics, conflicts of interest, and industry influence on prescribing behavior. Stimulus funds have increased the NIH budget by ten billion dollars, but NIH has no mechanism for funding research on how commercial interests affect the choice of medical therapeutics. Signers include Virginia Barbour MD, Chief Editor of PLoS Medicine, Jerome Kassirer, MD, former editor in chief of the New England Journal of Medicine, Jerry Avorn MD, the Harvard physician who invented academic detailing, Kay Dickersin PhD, Director of the U.S. Cochrane Center, and Susan Wood, PhD, former head of the FDA Office of Women’s Health Research, who resigned over political influence regarding FDA decisions on the emergency contraceptive Plan B. Institutional signers include the Public Library of Science, the American Medical Student Association, the National Physicians Alliance, Consumers Union, the Center for Science in the Public Interest, and the National Women’s Health Network. The letter, sent to NIH today, is available at <a href="http://www.pharmedout.org/NIHLetter.pdf">http://www.pharmedout.org/NIHLetter.pdf</a> (PDF) and below: <blockquote>Nov. 17, 2009 From: Adriane Fugh-Berman MD Department of Physiology and Biophysics Georgetown University Medical Center Box 571460 Washington DC 20057-1460 Phone: (202) 687-7845 Fax: (202) 687-7407 ajf29 AT georgetown DOT edu To: Francis S. Collins, MD, PhD Director National Institutes of Health 9000 Rockville Pike Bethesda, MD 20892 Dear Dr. Collins, We are writing to ask NIH to fund studies on medical ethics, conflicts of interest in medicine and research, and prescribing behavior. NIH funds a substantial portion of the generation and dissemination of evidence, but the uptake of that evidence and its translation into clinical practice is strongly affected by the complex web of relationships that exists among industry, academicians, medical educators and clinicians. There is growing evidence that each strand of this web is compromised by ethical lapses and financial conflicts of interest. The recent disclosure of ghostwritten articles, physician payoffs, and the use of academic opinion leaders to increase markets for FDA-regulated products indicate that ethical lapses may permeate biomedical research. A PLoS Medicine editorial in September called ghostwriting “The dirty little secret of medical publishing” and notes “the systematic manipulation and abuse of scholarly publishing by the pharmaceutical industry and its commercial partners in their attempt to influence the health care decisions of physicians and the general public.” [1] An October 1 editorial in the Boston Globe called for a ban on industry speaker fees to physicians. [2] Last month, a commentary in JAMA called for physicians to pay for continuing medical education (CME), [3] citing a recent Institute of Medicine report [4] that criticized physicians’ reliance on industry-funded education. A stated goal of the NIH is to “exemplify and promote the highest level of scientific integrity, public accountability, and social responsibility in the conduct of science.” Could the muted effect that large, definitive NIH studies, including the WHI, ALLHAT, and CATIE, have had on clinical practice be due to commercial influences? To what extent have ghostwritten articles corrupted the medical and scientific literature? The extent to which industry influences the interpretation of science is unknown. Dr. Elias Zerhouni, in the September 17th issue of Nature, commenting on Senator Grassley’s investigation of academic medical centers, said “People flouted the rules, didn’t disclose, and did it for years on end, repeatedly.” [5] In your role as the director of “the steward of medical and behavioral research for the Nation,” we ask that you acknowledge the research gap on the effect of conflicts of interest and commercial influence on medical decisionmaking and set in motion a process that leads to recognition of the importance of funding studies on research ethics, the beliefs and behaviors of researchers and clinicians, and the effects of industry-academic relationships on the generation and dissemination of medical knowledge. Between bench and bedside lies a path treacherous with ethical quandaries. NIH is the best place to launch and support a scientifically rigorous inquiry into the state of research ethics, industry-academic relationships, and the effect of these relationships on human health. There is currently no identifiable mechanism through which NIH would fund this research. Your leadership regarding the importance of this issue as one the NIH needs to direct resources towards is essential. We hope to discuss these issues in a face-to-face meeting. Sincerely, Adriane Fugh-Berman, MD Associate Professor, Georgetown University Medical Center Director, PharmedOut ajf29 AT georgetown DOT edu http://pharmedout.org [and others whose signatures can be seen at the PDF - ed.] [1] Ghostwriting: The Dirty Little Secret of Medical Publishing That Just Got Bigger. PLoS Medicine, September 8, 2009. <a href="http://www.plosmedicine.org/article/info%3Adoi%2F10.1371%2Fjournal.pmed.1000156">http://www.plosmedicine.org/article/info%3Adoi%2F10.1371%2Fjournal.pmed.1000156</a> [2] Keep Doctors Independent; Ban Fees From Drug Makers. Boston Globe, October 1, 2009. <a href="http://www.boston.com/bostonglobe/editorial_opinion/editorials/articles/2009/10/01/keep_doctors_independent_ban_fees_from_drug_makers/">http://www.boston.com/bostonglobe/editorial_opinion/editorials/articles/2009/10/01/keep_doctors_independent_ban_fees_from_drug_makers/</a> [3] Campbell EG, Rosenthal M. Reform of Continuing Medical Education: Investments in Physician Human Capital. JAMA. 2009;302(16):1807-1808. <a href="http://jama.ama-assn.org/cgi/content/full/302/16/1807?home">http://jama.ama-assn.org/cgi/content/full/302/16/1807?home</a> [4] Institute of Medicine. Conflict of Interest in Medical Research, Education, and Practice. Washington, DC: National Academies Press; April 28, 2009. <a href="http://www.iom.edu/CMS/3740/47464/65721.aspx">http://www.iom.edu/CMS/3740/47464/65721.aspx</a> [5] Wadman M. The Senator’s sleuth. Nature. 2009 Sept;461(17):330-4. </blockquote>This letter caught my eye, and I expressed support as follows, adding an additional angle to Dr. Fugh-Berman's letter: <blockquote>Dear Dr. Fugh-Berman, As a blogger at Healthcare Renewal, I will enthusiastically sign on to and endorse your letter calling on NIH to fund more research into ethics, conflicts of interest, and prescribing. I also wish to add an extended point: The issues of ethics and conflict of interest also affect healthcare information technology (HIT), and ultimately physician practice. HIT applications are experimental medical devices now being pushed upon physicians via the Office of the National Coordinator and HHS. These medical devices are soon to undergo regulation as such in the EU (pdf report from the Swedish Medical Products Agency <a href="http://www.lakemedelsverket.se/upload/foretag/medicinteknik/en/Medical-Information-Systems-Report_2009-06-18.pdf">here</a>), <a href="http://www.hc-sc.gc.ca/dhp-mps/md-im/activit/announce-annonce/md_notice_software_im_avis_logicels-eng.php">Canada</a>, the <a href="http://www.genomeweb.com/dxpgx/electronic-health-record-systems-will-require-some-form-oversight-government-adv">U.S.</a> and other countries as well. They are used in patient care without patient consent. Their use holds significant potential to monitor and enforce practices deemed appropriate by whomever has the most influence on the bodies controlling the use of these technologies and the data they generate. From that perspective, and from the perspective of the 2009 National Research Council report that calls for accelerating interdisciplinary research in biomedical informatics, computer science, social science [i.e., the social and ethical implications of health IT], and health care engineering as a sine qua non of health IT success, I believe it is time for NIH to take a leadership role in regulating these devices, conflicts of interest in the health IT industry, and the ethics of their use.</blockquote> I perhaps should have written "I believe it is time for NIH to take a leadership role in sponsoring research on regulating these devices, conflicts of interest in the health IT industry, and the ethics of their use", rather than calling on NIH to be a regulator. However, until the regulatory affairs concerning health IT are in order, I felt the stronger statement appropriate. -- SS

Seeking NIH to fund studies on medical ethics, conflicts of interest in medicine and research, and prescribing behavior

Adriane Fugh-Berman MD is principal investigator (PI) of the PharmedOut project. PharmedOut is an independent, publicly funded Georgetown...

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The Editorial that Wasn't: Evidence for Systematic Research Manipulation Undetectable by Critical Review

Woe to those of us who have been advocates for evidence-based medicine.  A short description of the evidence-based medicine is medicine whose practice is informed by critical, rigorous review of the best available evidence from clinical research as revealed by systematic search of the published research literature, as well as by the clinician's understanding of biology and the medical and biopsychosocial context, and by the patient's own values. Evidence-based medicine is based on some key assumptions.  One is that a systematic review will reveal all the results of research studies that are relevant to the issue at hand.  A second is that while the research studies may be flawed and imperfect, they are reported honestly. Unfortunately, as we have repeatedly discussed, there is more and more evidence that a systematic review will not reveal all relevant results, because research studies may be suppressed, perhaps often, when their results are unfavorable to vested interests.  (Look <a href="http://hcrenewal.blogspot.com/search/label/suppression%20of%20medical%20research">here</a> for further discussion.)  There is also considerable anecdotal evidence that the design, implementation, and analysis of research studies may be manipulated to make the results more likely to favor vested interests.  (Look <a href="http://hcrenewal.blogspot.com/search/label/manipulating%20clinical%20research">here</a> for further discussion.) An article by Vedula et al just published in the renowned New England Journal of Medicine suggests that such manipulation might be systemic, and that the reporting of manipulated studies may not clearly show what manipulation was done. (1) To summarize, the authors got access through legal proceedings to internal study protocols and research reports from clinical trials sponsored by Parke-Davis (later merged into Pfizer Inc) of gabapentin (Neurontin) for a variety of clinical problems other than seizures.  Gabapentin was originally marketed as an anti-seizure drug, but Pfizer later "admitted guilt for off-label marketing."  (We discussed the stealth marketing campaign for Neurontin <a href="http://hcrenewal.blogspot.com/2006/08/stealth-marketing-of-neurontin.html">here</a>.)  Vedula et al compared the primary outcome variables specified in the original research protocols, internal research reports, and any publications of the trials' results.  They identified 21 trials, 13 of which were published.  For 12 of the 13, the authors had access to the internal protocol, report, or both.  The main results were: <blockquote>For 8 of the 12 published trials, there was a disagreement between the definition of the primary outcome in the protocol and that in the published report.... Sources of disagreement included the introduction of an entirely new primary outcome in the published report (in the case of 6 trials); failure to distinguish between primary and secondary outcomes in the published report, even though the protocol did distinguish between them (2 trials); relegation of a primary outcome in the protocol to a secondary outcome in the published report (2 trials); and failure to include in the published report one or more primary outcomes specified in the protocol (5 trials). </blockquote> Furthermore, it appeared that failure of published articles to clearly and fully report results in terms of the original, pre-specified primary outcome variables occurred when these comparisons were not favorable to gabapentin. As the authors summarized: <blockquote>Thus, trials with findings that were not statistically significant (P≥0.05) for the protocol-defined primary outcome, according to the internal documents, either were not published in full or were published with a changed primary outcome. As shown in Figure 3, all the changes that took place between what was specified in the protocol, what was known before publication (as presented in the internal company research reports), and what was reported to the public led to a more favorable presentation in the medical literature of gabapentin's efficacy for unapproved indications. </blockquote> They concluded: <blockquote>We are concerned that the reporting practices observed in our analysis do not meet the ethical standards for clinical research or maintain the integrity of scientific knowledge. Fair and honest treatment of patients enrolled in clinical trials of any kind requires full, open, and unbiased reporting. Journal publication, a formalized platform for scientific discourse and dissemination of knowledge, should not be used as a marketing tool for off-label drug use. Reporting biases such as those we describe here increase the likelihood that interventions will appear to be effective when they are not. Such biases can lead to the omission of negative findings in systematic reviews of intervention effectiveness and in evidence-based guidelines. For example, the 2005 Cochrane systematic review regarding the effectiveness of gabapentin for acute and chronic pain concluded that it is effective on the basis of published findings and should now be updated with the inclusion of unpublished information made available through litigation. </blockquote> I believe that the article by Vedula et al is particularly important because it shows what appears to be systematic manipulation of the analysis and reporting of multiple clinical trials of the same drug (but for different indications) that had the effect of making the drug appear efficacious when it likely was not. Furthermore, the manipulation was concealed. The published research articles did not completely describe what the intended primary efficacy outcome variables were, did not provide results in terms of these variables, and instead provided results only in terms of variables that were chosen post-hoc as new primary outcome variables. To address that latter point, I independently reviewed three of the research publications cited by Vedula et al.(2,3,4) All three were noted to have reported significant results favoring gabapentin in terms of a primary efficacy outcome variable that was not identified as such in the corresponding studies' original research protocols or reports (see the <a href="http://content.nejm.org/cgi/content/full/361/20/1963/DC1">supplementary data</a> provided with the New England Journal article.) Per my review, none of the three published articles offered any hint that what they reported as primary outcome variables were not the variables originally chosen in that capacity, nor did they identify what those original primary outcome variables were, or how comparisons made using them turned out. The implications of the article by Vedula et al are very important. Hence, I was surprised that the article appeared without an accompanying editorial to discuss these implications, and that its publication did not generate much media interest. So that gives me an opportunity to comment further. One could start with the implications for evidence-based medicine. As noted above, a short description of the evidence-based medicine is medicine whose practice is informed by critical, rigorous review of the best available evidence from clinical research as revealed by systematic search of the published research literature, as well as by the clinician's understanding of biology and the medical and biopsychosocial context, and by the patient's own values. Evidence-based medicine depends on critical, rigorous review, but the review process is generally done under the assumptions that research publications honestly describe what was done and what its results were. The review process was never designed to detect dishonest reporting or find information that was deliberately concealed. Manipulation of research (design, analysis, and implementation), concealment of that manipulation, and outright suppression of research threaten the foundations of evidence-based medicine. Yet the article by Vedula et al is part of a growing body of evidence that such manipulation, concealment and suppression are widespread, and done to serve vested interests, often commercial. That is a huge problem for proponents of evidence-based medicine, but also for physicians who want their practices to be based on science, for patients who want their care to be based on science, and for all those in society who see the advancement of medical science as a way to improve peoples' lives. As senior author Professor Kay Dickersin noted in an interview <a href="http://www.bloomberg.com/apps/news?pid=20601087&sid=azEz6zlMyS0I&pos=7">with Bloomberg</a> "The trouble is, as a scientist, the publication has always been held up to me as the truth. It's the scientific record. What this study indicated is we can't believe that record." Furthermore, to be a bit more concrete, most physicians, patients, and policy makers depend on what appears to be honest clinical research to make decisions about individual care and health policy. Deliberate and deceitful manipulation of clinical research to favor sponsors' products has likely lead to excessive use of and payments for drugs and devices that are less effective than advertised, if not useless or dangerous. Thus, it is likely that such manipulation is partially responsible for ever increasing health costs and poor health outcomes. Finally, we need to start thinking about how we can detect and compensate for manipulation of clinical research in the past, and deter such manipulation in the future. One possible deterrent would be, as was noted by Vedula et al, detailed clinical trials registries that contain complete information about trial protocols.  For this to be effective, there need to be mechanisms to assure compliance, and penalties for non-compliance.  Moreover, since clinical research is now global, the registries must have global scope, and enforced assurance of compliance must also be global. Registries might decrease future manipulation and suppression of research.   No one has suggested, as far as I know, a systematic way to detect and correct for previous manipulation. It would require a major, global investigative effort to uncover manipulation, and it would be a major scientific and policy endeavor to reveal most suppressed research and correct most manipulations. However, before anything is done, patients, physicians and policy makers must acknowledge and understand the problem.  Yet it seems that even discussing these may be topics that are very uncomfortable for some of us. The longer we shrink from addressing them, however, the worse will be the results for patients, physicians, science and society. References 1. Vedula SS, Bero L, Scherer RW, Dickersin K. Outcome reporting in industry-sponsored tirals of gabapentin for off-label use. N Engl J Med 2009; 361: 1963-1971. Link <a href="http://content.nejm.org/cgi/content/short/361/20/1963">here</a>. 2. Mathew NT, Rapoport A, Saper J et al. Efficacy of gabapentin in migraine prophylaxis. Headache 2001; 41: 119-128. Link <a href="http://www3.interscience.wiley.com/cgi-bin/fulltext/119014515/PDFSTART">here</a>. 3. Vieta E, Goikolea JM, Martinea-Aran A et al. A double-blind, randomized, placebo-controlled, prophylaxis study of adjunctive gabapentin for bipolar disorder. J Clin Psychiatr 2006; 67: 473-477.  Link <a href="http://www.psychiatrist.com/privatepdf/2006/v67n03/v67n0320.pdf">here</a>. 4. Caraceni A, Zecca E, Bonezzi C et al. Gabapentin for neuropathic cancer pain: a randomized controlled trial from the gabapentin cancer pain study group. J Clin Oncol 2004; 22: 2909-2917. Link <a href="http://jco.ascopubs.org/cgi/reprint/22/14/2909">here</a>.

The Editorial that Wasn't: Evidence for Systematic Research Manipulation Undetectable by Critical Review

Woe to those of us who have been advocates for evidence-based medicine. A short description of the evidence-based medicine is medicine whos...

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Omnicare, IVAX Settle

Settlements and kickbacks and corporate integrity agreements, oh my (to the tune of "lions and tigers and bears, oh my") To quote the <a href="http://www.businessweek.com/bwdaily/dnflash/content/nov2009/db2009114_700374.htm">BusinessWeek version</a> of the story: <blockquote>A $112 million settlement involving alleged drug kickbacks that the Justice Dept. announced with the nation's largest nursing home pharmacy and a generic drug manufacturer on Nov. 3 is part of a wide-ranging investigation of suspected Medicaid fraud by the pharmaceutical industry. Under Tuesday's settlement, Omnicare will pay $98 million plus interest to the federal government and a number of state Medicaid programs to settle allegations that it participated in kickback schemes with IVAX, J&J [Johnson & Johnson], and two nursing home chains. IVAX, a subsidiary of Israel's Teva Pharmaceutical Industries (TEVA), agreed to pay $14 million plus interest. Omnicare and IVAX entered 'corporate integrity agreements' to establish new training and policies to prevent future problems. Neither company admitted any wrongdoing. </blockquote> Here are some details of the alleged wrong-doing: <blockquote>Omnicare is a publicly traded pharmacy benefit manager for long-term care facilities that operates in 47 states, the District of Columbia, and Canada. It had revenues of $6.3 billion in 2008. According to the settlement, Omnicare allegedly received $8 million in payments from IVAX in 2000-04 to buy $50 million in generic drugs and recommend that physicians prescribe them to their nursing home patients. Omnicare entered the contract even though its outside counsel repeatedly warned it might violate the federal anti-kickback law, the government alleged in its complaint, filed in March. Omnicare also took payments from New Brunswick (N.J.)-based J&J from 1999 to 2004 to aggressively persuade doctors to prescribe Risperdal, an anti-psychotic drug, and discourage use of alternative medications, according to the settlement. In addition, Omnicare allegedly paid $50 million to nursing home chains Mariner Health Care and SavaSeniorCare in 2004 to keep referring their Medicaid and Medicare patients to Omnicare for pharmacy services. </blockquote> It is noteworthy that these activities went on despite repeated advice of at least one attorney: <blockquote>According to the government's complaint, Omnicare again ignored its outside counsel's advice that the payment was illegal. </blockquote> The activities also went on despite Omnicare's participation in a previous corporate integrity agreement. <blockquote>This isn't the first time Omnicare has had to settle civil fraud complaints filed by the government. In 2006, Omnicare agreed to pay $102 million to settle Medicaid fraud cases in 43 states, without admitting wrongdoing, including a $52.5 million settlement with Michigan. One complaint accused Omnicare of switching two drugs from tablet to capsule form to boost Medicaid payments. Omnicare had to enter a five-year corporate integrity agreement. </blockquote> As I have written again and again regarding many other cases that resulted in <a href="http://hcrenewal.blogspot.com/search/label/legal%20settlements">legal settlements</a> or <a href="http://hcrenewal.blogspot.com/search/label/crime">guilty pleas</a>, the companies involved only need to pay fines, and no individual who performed, directed or approved unethical or illegal acts will suffer any negative consequences. I submit once again that such fines are viewed merely as costs of doing business by the affected companies, and do not deter future bad behavior. For once, the coverage of this case included some opinions similar to mine: <blockquote>The Office of Inspector General of the Health & Human Services Dept. has the authority to bar health-care companies from participating in the Medicaid, Medicare, and other federal health programs as a penalty for violating anti-fraud laws. That's a severe sanction given the huge size of those programs. The settlements with Omnicare and IVAX left open the possibility of exclusion. Some experts say Omnicare should be barred as a repeat offender, to send a strong message to other pharmaceutical industry players that fraud will no longer be tolerated. 'If the government were really serious, they'd give Omnicare the death sentence,' said Erik Gordon, a business professor at the University of Michigan who follows the pharmaceutical industry. 'Then all the other players would say this isn't just the cost of doing business, this is a bet-the-company thing.' West declined to comment on whether the Justice Dept. will recommended the exclusion of the two companies, saying only that his office works closely with the OIG's office on appropriate penalties. [Patrick] Burns, with Taxpayers Against Fraud, said the government has been hesitant to exclude health-care companies for fraud, fearing it will be seen as overzealous. But he believes that's the wrong attitude. 'Doing business with the U.S. government is a privilege, not a right,' he said. 'I think Omnicare has abused the privilege.' </blockquote> Finally, note that the description of this case suggested that the kickbacks had effects on physicians' prescribing and hence the use of specific drugs. The Justice Department's filing alleged that in return for the payment from IVAX, Omnicare tried to get physicians to prescribe that company's products, and that in return for the payment from J&J, Omnicare pushed them to prescribe the atypical anti-psychotic Risperdal. Thus the activities that went on this case could have lead to the use of inappropriate, useless or even harmful drugs by certain patients. I submit that would-be health care reformers who want to improve care, reduce costs and improve access should advocate for real negative consequences for people who implement, direct or approve the various versions of fraud, kickbacks, and miscellaneous corruption and malfeasance we have discussed on Health Care Renewal. By the way, it appears one of the members of <a href="http://ir.omnicare.com/phoenix.zhtml?c=65516&p=irol-govboard">Omnicare's Board of Directors</a> is also a leader in academic health care.  She is Andrea R. Lindell, DNSc, RN, who is also <a href="http://webcentral.uc.edu/eProf/viewoutput.cfm?Action=PublicDoc&code=WebPage&shci=0&epid=OTAwNA%3D%3D">Dean of the College of Nursing</a> at the University of Cincinnati.  One would think that someone who thus <a href="http://nursing.uc.edu/">boasts</a> "the success of our students, faculty, staff and alumni who work together to promote excellence in education, research, service and practice" needs to keep a closer eye on the ethical aspects of her company's management.

Omnicare, IVAX Settle

Settlements and kickbacks and corporate integrity agreements, oh my (to the tune of "lions and tigers and bears, oh my") To quote ...

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Suppression of Clinical Trials of Sumatriptan

Correspondence to the Lancet two weeks ago revealed another instance in which clinical research studies that failed to provide results favorable to a sponsor's product were suppressed. [Tfeft-Hansen  PC. Unpublished clinical trials of sumatriptan. Lancet 2009; 374: 1501-2.  Link <a href="http://www.thelancet.com/journals/lancet/article/PIIS0140-6736%2809%2961906-1/fulltext">here</a>.] Sumatriptan, sold as Imitrex by GlaxoSmithKline, and now available generically, is a commonly used treatment for acute migraine headaches.  A Cochrane review from 2003 concluded that multiple clinical trials versus placebo showed that the drug is a safe and effective treatment of acute migraine [link <a href="http://mrw.interscience.wiley.com/cochrane/clsysrev/articles/CD002915/pdf_abstract_fs.html">here</a>.]  A comparison of multiple guidelines for headache treatment noted considerable variability in how guidelines were developed, but that a number recommended sumatriptan as a first-line agent based apparently mainly on trials against placebo, while noting a lack of head-to-head comparisons among sumatriptan (and other triptans) and older, simpler treatments, like non-steroidal anti-inflammatory drugs (NSAIDs).  [Schuurmans A, van Weel C. Pharmacologic treatment of migraine: comparison of guidelines. Can Fam Physician 2005; 51: 838-843.  Link <a href="http://www.cfp.ca/cgi/reprint/51/6/838">here</a>.] Tfelt-Hansen had written a review of treatment of migraine with a combination of ergotamine and caffeine, which included a single trial comparing that combination to sumatriptan.  He noted that the results of this trial appeared on "the homepage of the Swedish Medical Agency," but were not published in a peer-reviewed journal.  The trial suggested that sumatriptan was inferior to the combination.  Tfelt-Hansen looked up this trial in the GlaxoSmithKline trial register.  Recall that this database was the source of information on unpublished trials of Avandia (rosiglitazone, GSK) that Dr Steven Nissen and colleagues meta-analyzed to suggest that Avandia may produce adverse cardiovascular effects (see post <a href="http://hcrenewal.blogspot.com/2007/05/dream-turns-to-nightmare-avandia-and.html">here</a>).   Recall also that the registry was created as part of a settlement of a lawsuit by then New York Attorney General Elliot Spitzer that accused GSK of concealing clinical research unfavorable to its drug paroxetine (Paxil, GSK).  [Steinbrook R. Registration of clinical trials - voluntary or mandatory? N Engl J Med 2004; 351:1820-1822.  Link <a href="http://content.nejm.org/cgi/content/full/351/18/1820">here</a>.] Tfelt-Hansen's main finding was that there were six trials comparing sumatriptan to other treatments, including paracetamol (acetaminophen) plus metaclopamide (2 trials), buclizine chloride, paracetamol and codeine (2 trials), ergotamine tartrate, cyclizine HCl, caffeine (1 trial), and ergotamine tartrate plus caffeine (1 trial).  In 3 trials, sumatriptan treated patients were not significantly more likely to have relief of their headaches within 2 hours.  In 1 trial, there was a non-significant trend favoring sumatriptan.  In two trials, sumatriptan was superior to the comparison.  In 4 trials, the rate of relief after sumatriptan treatment was 50% or less.  Tfelt-Hansen concluded: <blockquote>It is easy to understand why these RCTs were never published when sumatriptan was introduced: in only one of the oral trials did more than 50% of patients have headache relief (the primary efficacy measure) after sumatriptan 100 mg for the first attack treated (table), and in the RCT with rectal sumatriptan, the drug was found inferior to ergotamine. These findings would at the time have spoiled the very positive picture of sumatriptan as a new wonder drug for migraine. </blockquote> Of course, this points out that health care corporations may regard clinical trials more as marketing tools than as science. We have discussed <a href="http://hcrenewal.blogspot.com/search/label/suppression%20of%20medical%20research">numerous instances</a> in which trials that did not show commercial sponsors' products in a favorable light were suppressed by these sponsors. Individual trials only at best produce approximations of the truth about the drugs or devices they compare. Trials may be positive due to chance alone when the test or treatment under study actually has no good effects. Post-hoc suppression of "negative" trials therefore may exaggerate the benefits (and safety) of tests or treatments. Physicians and patients who try to uphold the ideals of evidence-based medicine, and base decisions on the best possible evidence can be misled when evidence unfavorable to vested interests is systematically suppressed. Suppression of evidence unfavorable to vested interests may lead to excess use of tests and treatments that really are less beneficial or more risky than the published evidence suggested, and to willingness to pay exaggerated prices for such tests and treatments. Thus suppression of evidence can lead to excess costs and bad outcomes. Also, as we have said before, suppression of results of clinical research that are unfavorable to the vested interests of research sponsors violates the trust of research subjects.  Research subjects are often assured that their participation is for the benefit of science and health care.  Suppressing results unfavorable to vested interests distorts science and makes health care more dysfunctional. Evidence that is purposefully suppressed is by definition hard to find. Nonetheless, we have seen several recent examples in which suppressed evidence was later revealed, and when combined with existing evidence, showed that previously hyped treatments were really not as safe and effective as was thought.  In particular, the suppression by various drug companies of evidence unfavorable to new anti-depressants they were marketing has generated some discussion (see post <a href="http://hcrenewal.blogspot.com/2009/08/high-costs-and-poor-outcomes-lesson.html">here</a>). This parade of examples suggests that stronger measures are needed to assure that clinical research is not suppressed due to the vested interests of research sponsors.  One seemingly radical, but increasingly plausible approach would ban corporations that sell health care products or services from influencing clinical research done to evaluate those products.  Would be health care reformers who really want to improve outcomes, improve access and decrease costs might want to think about how to make the evidence available about the outcomes of health care interventions more honest.

Suppression of Clinical Trials of Sumatriptan

Correspondence to the Lancet two weeks ago revealed another instance in which clinical research studies that failed to provide results favor...

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