Tuesday, September 30, 2008

What's a life worth to Cephalon and its stockholders?

Apparently, not very much, considering their off-label promotions of opiate-laced lollipops.

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?

-- SS


Nick said...

Instead of a wake-up call, it's merely "the cost of doing business." Compare and contrast this with tobacco lawsuits - the idea was to fine them so much that it would permanently change the way that they did business. This is just an inconvience.

Anonymous said...

As a business person I have to view this through a business prism. First: "Cephalon had reserved the $425 million for the federal settlement last year." This indicates that the margin on these product are so great that this company can expense this fine. This is similar to the statement made by the device manufactures after they were fined that they would suffer no material impact on earnings.

Cutting through the biz speak this means that these companies can absorb these fines and they will not prove to be a deterrent to these same behaviors in the future.

We look today at the announcement by GSK that they are cutting R&D staff to realign their priorities. Pfizer announced it is getting out of the heart business, the business that has made it billions in the last decade, to focus on, from my perspective, softer less difficult markets such as dementia and oncology. Results may not be measured as stringently for these conditions given the larger body of data on more common conditions.

Often sighted by drug companies is the hostile environment of today's FDA. My personal feeling is the FDA has become aware of drug companies spinning data, and results, and are now demanding a higher standard in more common drugs. Surrogate end points may not be allowed in the future, but instead hard data proving a drugs effectiveness may be the standard.

Taken collectively these companies are acting as, well, companies. There is no higher calling. There is no loyalty to the data. There is only a drive to sell product at the highest price to the most people, regardless of need, or even desire. Pharma is a true marketing industry with all of the same morals and ethics as a Ponzi scheme.

I find it personally insulting when doctors defend pharma as some golden industry claiming I, and my insurance company, are required to both use, and pay, a higher price for branded drugs in order to support this industry. Further, doctors demean their profession with claims of not being influenced by pharma while patients watch drug reps bring in food and other items, while the doctors themselves speak of attending meetings at expensive resorts or restaurants.

The only issue left is what will pharma's response be when a standard of treatment they have promoted for years is found to be of no medical use: Thank you for your multibillion contribution to our corporate coffers? As a marketing entity pharma will always look for greener pastures where they can employ the same tactics they have used in the past. Sales people are creatures of habit and the habits they have learned will die hard.

Steve Lucas

FallenAttorney said...

If you need evidence that Cephalon's promotion of Provigil for non-approved uses is a very bad idea, consider my case:

Several years ago, My physician met for the first time with a Cephalon sales representative. Being a doctor who saw many adult ADHD patients, she decided to prescribe Provigil for me for a 3-month trial with an eye towards eventually substituting Provigil for Dexedrine. I had been taking Dexedrine for ADHD for nearly 15 years without problem. However, she became convinced after meeting with the Cephalon rep that Provigil could offer me therapeutic benefit equivalent to that of Dexedrine without posing the cardiac risks associated with amphetamines to someone like me in his middle 50s. Six weeks later, I awoke in a delusional state. 2 hours later I arrived painless at the ER, but highly hypotensive and well into acute renal failure. 30 minutes later, I was in cardiogenic shock, and after the on-call cardiologist inserted an intra-aortic balloon, a helicopter took me to a regional heart center. Finding no typical ECG signs of a myocardial infarction, I remained on a ventilator and on the brink of death for 2 weeks with my kidneys nearly useless. 32 days after I was admitted, I left the hospital for home, alive if barely. A year later, a cardiac MRI disclosed that I had suffered a small subendocardial infarction, usually associated with severe hypotension. I have since learned that hypotension/vasodilation is a side effect which studies have shown to occur in 1 out of every 30users of Provigil.

Anonymous said...

Large corporations want all the 'rights' of personhood with none of the accountability. Until we see many more CEO's and their sycophants doing a perp walk, with shareholders paying for the promise of high ROI's, nothing is going to change.

Quite frankly, I think the 3-strikes-and-you're-out paradigm that some states apply to individuals should be applied to corporations. Three-strikes and the company will be nationalized or cannabalized by the competitors--maybe THAT would get some attention?


MedInformaticsMD said...


I am sorry to hear of your travails. I hope you will be well with no lasting problems.

Speaking as I might have when I was a medical resident about what was done, let me say "that really sucks."