In what prosecutors called the largest health-care settlement in federal court here, Cephalon Inc. will pay $425 million to settle criminal and civil charges that it illegally marketed three of its drugs.
The Frazer company is expected to plead guilty in U.S. District Court to one misdemeanor criminal charge, the U.S. Attorney's Office in Philadelphia announced yesterday.
Cephalon, a biopharmaceutical company based in Chester County, previously announced last November an "agreement in principle" with the U.S. attorney and Justice Department over an investigation that began in 2003 of its "off-label" promotion and sales of pain medication Actiq, Provigil for sleep disorders, and Gabitril for epilepsy.
Cephalon said yesterday that it had reached separate agreements with attorneys general in Connecticut and Massachusetts to settle related probes.
The drug manufacturer will pay $6.15 million to Connecticut and $700,000 to Massachusetts.
That's the cost of "doing business" to unscrupulous drug marketering and salesforce leaders:
Cephalon's off-label campaigns were successful. Actiq sales jumped from $50.1 million in 2001 to $550.4 million in 2006.
Gabitril revenue rose from $24.6 million in 2001 to $87.3 million in 2004, and Provigil sales from $146.2 million in 2001 to $691.7 million in 2006, the government said.
What's the problem with the strategy of off-label advertising?
While doctors are free to prescribe medicines for any condition they believe appropriate, drug manufacturers can promote products in the United States only for FDA-approved uses.
Were leaders at Cephalon, I add, hired and trained and unleashed without that knowledge? Or did they deliberately flout the law? And if so, have the individuals involved been properly held accountable?
Law enforcement authorities began seeing misuse of Actiq by people who also abused OxyContin and other narcotic painkillers in 2004. Actiq had the street name "perc-o-pops."
Actiq, a berry-flavored cancer-pain treatment on a stick, is approved to treat bouts of severe cancer pain in patients who can tolerate opiods such as morphine. But Cephalon promoted it to treat migraines and backaches, prosecutors said .... acting U.S. Attorney Laurie Magid said at a news briefing "We know in the case of these drugs, patients were harmed, including death, when there was off-label use."
Treatment of migraines and backaches with a drug used to treat pain of metastatic cancer?? The former are just the complaints many addicts use in ED's and doctor's offices to get drugs.
I spent the early part of my career trying to convince public transit vehicle operators, police, fire, and other mission-critical personnel not to abuse drugs, and oversaw testing for same.
Now, here come the pharmas, encouraging physicians (some of them - a minority - unscrupulous themselves, but others naive or misled by drug reps and advertising) to prescribe questionable drugs resulting in harm to innocent patients, abuses by dishonest "patient-actors", and support of the street drug trade.
How did this practice come to light?
In January 2003, a former Cephalon sales representative in Ohio, Bruce Boise, contacted the FDA about Cephalon's sales practices. Boise wore an undercover wire to a company sales conference to help the government gather evidence, according to his Washington-based attorney, Peter Chatfield.
In November 2003, another Cephalon sales representative, Lucia Paccione, of Philadelphia, filed the first of four qui tam "whistle-blower" lawsuits. The complaints were unsealed yesterday.
In this case, four whistle-blowers will divide about $46.5 million plus accrued interest, prosecutors said.
The ultimate costs to the company?
News of the settlement, known to Wall Street for months, barely budged Cephalon's stock price. Shares closed down $1.31, or 1.64 percent, at $78.57. Cephalon had reserved the $425 million for the federal settlement last year.
In summary, the life of an unsuspecting patient who takes Cepahalon drugs for off-label uses that were illegally advertised and then suffers harm, and the life of those addicted to drugs, seem worth little to Cephalon and its stockholders.
In my opinion, as long as this pharma/stockholder/cost-of-doing-business dystopia continues, we can look forward to an unending stream of this type of situation.
The penalties for this type of conduct need to be escalated. Instead of just a fine of $425 million, how about the addition of long prison sentences and exclusion from any further involvement in biomedicine - for life - for the perps?