Monday, October 01, 2007

Bristol-Myers Squibb Settles, Enters "Corporate Integrity Agreement"

And here we go again. Reported first late last Friday afternoon, as these things often are, was the huge settlement made by pharmaceutical manufacturer Bristol-Myers Squibb. This story received surprisingly little coverage in the main stream media, although World News Tonight (ABC) lead with it. The most detailed print version was in the Boston Globe,

Bristol-Myers Squibb and a subsidiary have agreed to pay more than $515 million to settle civil suits over fraudulent drug marketing and pricing schemes, including illegally promoting an anti-psychotic drug to children and the elderly, US Attorney Michael J. Sullivan said yesterday.

The settlement between the federal government and Bristol-Myers Squibb and Apothecon Inc. is the third-largest between a pharmaceutical company and the US Attorney's Office in Massachusetts....

The company said it has ... entered into a five-year 'corporate integrity agreement' with the Office of the Inspector General of the Department of Health and Human Services that requires it to develop programs to ensure compliance with the law.

The most notable charges involved unethical marketing practices.

The agreement says Bristol-Myers Squibb gave kickbacks to physicians and healthcare providers from 2000 through mid-2003 to get them to prescribe the company's drugs. The kickbacks came in several forms, including consulting fees and trips to luxury resorts.

From 2002 through 2005, Bristol-Myers Squibb promoted the sale of Abilify, an anti-psychotic drug, for pediatric use and to treat dementia-related psychosis, both "off-label" uses, prosecutors said. The Food and Drug Administration has approved Abilify to treat adult schizophrenia and bipolar disorder but not for the uses marketed by Bristol-Myers Squibb.

Nonetheless, Bristol-Myers Squibb created a special longterm-care sales force that called on nursing homes and promoted off-label use of Abilify, prosecutors said.

A sales force also visited child psychiatrists and other pediatric specialists and urged them to prescribe Abilify.

There were also allegations of pricing hanky-panky.

Bristol-Myers Squibb participated in pricing schemes, including one involving its anti-depressant drug Serzone, that defrauded the Medicaid program, prosecutors said.

Bristol-Myers Squibb and Apothecon also inflated prices for a wide assortment of cancer-fighting and generic drugs, deceiving federal healthcare programs that established reimbursement rates based on those prices, prosecutors said.

Not surprisingly, the company wants to put it all behind it.

Bristol-Myers Squibb is pleased to have resolved these matters from the past and is proud of its commitment to conduct business with the highest standards of integrity in its mission to extend and enhance human life.

Critics of the industry were not impressed.

Dr. Jerome Kassirer, a professor at Tufts University School of Medicine and outspoken critic of drug companies, is skeptical.

'A lot of these companies, when they get sued for a few million dollars, they just consider it loose change,' he said. 'I haven't seen any let-up in what they're doing. Most of the time, when they're caught, they'll often say, 'It was a renegade, someone who wasn't following the instructions. Our policy says we shouldn't do that.' '

Similarly, Thomas M. Greene, a Boston lawyer representing one of the whistleblowers, said the allegations are serious because off-label use has the potential to harm patients.

'What happens when you promote a drug that is not effective?' he said. 'You're depriving sick people of some other effective treatment.'

As in the recent case involving orthopedic device manufacturers, (see post here), so far, despite the huge corporate fine, it is not clear that any individuals, either at the drug company, or physicians, will pay a penalty.

As we noted before, corporate payments of huge fines may not be much of a negative incentive to corporate executives because the impact of the fines can be spread across the entire organization. And such fines clearly have no direct effect on physicians, and will not discourage them from accepting "consulting fees and trips to luxury resorts" on behalf of drug marketers.

How many more examples like this do we as a society need before we conclude that there is a systemic problem with unethical behavior by leaders of health care organizations, and that we need a systemic solution to this problem that goes past civil lawsuits, corporate compliance monitoring, and deferred prosecution agreements?

ADDENDUM - See also comments on BrandweekNRX, and on the Wall Street Journal Health Blog.


bev M.D. said...

When some of them get prosecuted criminally, like Enron et al, then the behavior will stop, or go underground.

Anonymous said...

I work in industry but I am disgusted by what I see my own company and others doing. I don't think you need criminal prosecution but at least it would be helpful if these CIA's and settlements at least forced the firing of the people involved. In big pharma bad sales represenatives are expendable and will be fired but marketing execs will be protected and hidden. It's like the church with bad priests. And the government plays alone. The CIA's are a joke. They allow the government to brag about the big settlements but they do nothing to bring about real change. Companies find a way around the policies, you would be amazed at how creative people can be. The government needs to hold individuals accountable period. If not with criminal charges then at least by forcing the companies who settle to fire all of the individuals involved in the wrong-doing. Read the CIA's, they never require it. The OIG doesn't even seek it. They just want the paper settlement and a big fine to hang on the wall. We have all of this enforcement, settlement after settlement, and NOTHING changes. You end up with all these policies and auditing but smart marketing execs who are finding every possible hole they can find and using all sorts of incentives to encourage more junior people to push the buttons. The government has now become part of the problem because they have lead people to believe that vigorous enforcement is the solution. But instead we have a bunch of 100-page sweatheart deals with big checks attached to them. It's a scandal that folks will write about 10 years from now.