Thursday, October 19, 2017

Worst Health Care Revolving Door Case So Far, Version 2.0? - From President of Lilly USA to US Secretary of Health and Human Services?

Last week, we discussed what appeared to be the most egregious case of the health care revolving door seen so far.  A health care corporate lobbyist without any direct medical, health care, public health or biomedical science experience was named Acting US Secretary of Health and Human Services after being confirmed as Deputy Secretary.


Former Top Executive of Pharmaceutical Company Eli Lilly Considered for Nomination as Secretary of Health and Human Services

Only a week later, an even more egregious case may be in the works.  The name being "floated" as nominee to be the next Secretary of Health and Human Services is Mr Alex Azar, who through this year was a top pharmaceutical executive.  Again, he has no experience in medicine, the health professions, public health or biomedical sciences.

To repeat, you cannot make this stuff up.

As reported by Politco on October 17, 2017...

Azar has spent most of the past decade inside the drug industry, one of the key sectors he’ll regulate at HHS. Azar joined pharmaceutical giant Eli Lilly and Company in June 2007 as a senior vice president of corporate affairs and communications right after leaving the Bush administration.

He rose to head Lilly’s U.S. operations in 2012, a position he held until this January, when he left the company. At Lilly he worked on both international and federal government affairs and public policy. Other areas of focus included counterfeit medicines and health information technology.
By the way,

As part of his role at Lilly, Azar served on the board of directors for BIO, a drug lobby.

Mr Azar did have prior experience in the Department of Health and Human Services, but essentially as a lawyer/ administrator,

He served as the department’s general counsel and deputy secretary during the Bush administration.

Political, but No Medical, Health Care Professional, Public Health or Biomedical Science Credentials

To emphasize his lack of medical, health care, public health or biomedical science background, see this quote from what Mr Azar wrote this in his alumni profile for the Yale Law School,

I entered healthcare largely by accident. After law school, I clerked for Justice Antonin Scalia and then joined a D.C. law firm. I went to work for my mentor Ken Starr immediately after he became the Whitewater independent counsel.

While at my law firm, Wiley, Rein & Fielding, I was active in the Bush-Cheney campaign in 2000. After Bush won, I received a call from the office of Tommy Thompson, Secretary of the Department of Health & Human Services, asking me if I'd have interest in being General Counsel of HHS. I'll confess that I wrestled with the question, since I had not focused on health law in my legal career.

The Politico article suggests that the Trump regime might consider most of Mr Azar's credentials to be the top US health official are political,

He has also been a harsh critic of Obamacare and cheered GOP efforts to repeal and replace it, telling Fox Business in May that the Obamacare is 'fundamentally broken' and 'circling the drain.'

Azar emerged as a strong backer of former Florida Gov. Jeb Bush’s Republican presidential campaign in 2016, serving on Bush’s 30-member Indiana steering committee in the lead-up to the election.

Azar knows Vice President Mike Pence from his time at Lilly, which is headquartered in Indianapolis.
 Note that were he to become Secretary of DHHS, unless the Affordable Care Act ("Obamacare") were to be repealed, he would be charged with enforcing it.

And years prior to that, according to the Washington Post,

Azar clerked for Supreme Court Justice Antonin Scalia and, after Bill Clinton became president, worked under special counsel Kenneth Starr as he investigated Clinton’s failed Whitewater real estate investments.

Lilly's Poor Ethical Track Record on his Watch

Unlike the Mr Hargan, who transited the revolving door from a lobbying position, Mr Azar had direct operational responsibility, in this case, for Eli Lilly's US operations.  Thus he ought to be held responsible for the company's ethical misadventures during the time he was there.  In fact, the company has had a few such misadventures, some of which we have previously discussed.


Jury Found Takeda and Eli Lilly Concealed Cancer Risks of Actos, Company Subject to Punitive Damages of $36.8 Million - 2014

We discussed this in 2014.  This case seemed to involve serious deceptions, since the judge said in one ruling:

the evidence during the trial showed that the companies 'disregarded, denied, obfuscated and concealed' for more than a decade that Actos could increase patients' risk for bladder cancer.


Lilly Pleaded Guilty to Charges Related to Deceptive Marketing of Zypresa as Part of an Over $1 Billion Settlement - 2009

At the time, this was considered a landmark case.  Eli Lilly pleaded guilty to a misdemeanor criminal charges and settled allegations about questionable marketing practices for its anti-psychotic drug Zyprexa for over $1 billion in 2009 (see post here).  The settlement provided some instructive information about how big pharmaceutical companies employ ghost writing to sell product (see this post). The company pushed Zyprexa for elderly patients with dementia, despite the lack of evidence that the drug's benefits outweighed its clear harms, thus likely leading to patient harm.

Many other cases of dubious Lilly practices that did not necessarily lead to legal settlements or criminal charges can be found here.  These practices include older, lesser cases involving the revolving door; and various instances of apparently deceptive marketing practices such as planned obsolescence of drugs, use of physician "thought leaders" as covert drug marketers, payments to patient advocacy groups presumably to encourage them to act also as covert drug marketers, etc, etc

Furthermore, the company was involved in several major cases of misbehavior overseas about which  Mr Azar may or may not have been aware.  These included:

-  Lilly Fined by Brazil for "Sham" Litigation to Extend Patent on Gemzar - 2015

Per the Wall Street Journal, the government deemed the company to have engaged in anti-competitive behavior.

-  Lilly Settled Case Alleging it Bribed Foreign Officials to Win Business - 2012

We discussed this here.  This case seemed serious since it involved lavish gifts and payments made from 2006-2009 to Chinese physicians who worked for the government , bribes to health officials to Brazil starting in 2007, and other such transactions in other countries in previous years.

Discussion

Last week we noted that Mr Trump famously promised to "drain the swamp" in Washington.  Last week, despite his previous pledges to not appoint lobbyists to powerful positions, he appointed a lobbyist to be acting DHHS Secretary.  This week he is apparently strongly considering Mr Alex Azar, a pharmaceutical executive to be permanent DHHS Secretary, even though the FDA, part of DHHS, has direct regulatory authority over the pharmaceutical industry, and many other DHHS policies strongly affect the pharmaceutical industry.  (By the way, Mr Azar was also in charge of one lobbying effort.) 

So should Mr Azar be confirmed as Secretary of DHHS, the fox guarding the hen house appears to be a reasonable analogy.

Moreover, several serious legal cases involving bad behavior by his company, and multiple other instances of apparently unethical behavior occurred on Mr Azar's watch at Eli Lilly.  So the fox might be not the most reputable member of the species.

So you know the drill....     The revolving door is a species of conflict of interest. Worse, some experts have suggested that the revolving door is in fact corruption.  As we noted here, the experts from the distinguished European anti-corruption group U4 wrote,
The literature makes clear that the revolving door process is a source of valuable political connections for private firms. But it generates corruption risks and has strong distortionary effects on the economy, especially when this power is concentrated within a few firms.

The ongoing parade of people transiting the revolving door from industry to the Trump administration once again suggests how the revolving door may enable certain of those with private vested interests to have excess influence, way beyond that of ordinary citizens, on how the government works, and that the country is still increasingly being run by a cozy group of insiders with ties to both government and industry. This has been termed crony capitalism. The latest cohort and now this most flagrant example of revolving door transits suggests that regulatory capture is likely to become much worse in the near future.

So, as we have said before [before, before...] The continuing egregiousness of the revolving door in health care shows how health care leadership can play mutually beneficial games, regardless of the their effects on patients' and the public's health.  Once again, true health care reform would cut the ties between government and corporate leaders and their cronies that have lead to government of, for and by corporate executives rather than the people at large.

Let me at least try to provide a new picture of the revolving door...


Wednesday, October 11, 2017

Worst Health Care Revolving Door Case So Far? - From Lobbyist to Acting Secretary of Department of Health and Human Services

Once again, you just cannot make this stuff up.

Last week we posted our latest revolving door roundup, one of many we have done during the Trump administration.  At the time we noted that a lobbyist, Mr Eric D Hargan, at Greenberg Taurig Alston & Bird, had been nominated to be Deputy Secretary of the Department of Health and Human Services (DHHS).

Wikepedia provides a little more information about his past lobbying employment.

Hargan left the government in 2007 and joined the health law department of law firm McDermott Will & Emery. Hargan joined the health and FDA business development practice of law firm Greenberg Traurig in June 2010. He is a shareholder in Greenberg Traurig's Health & FDA Business Practice.

Greenberg Taurig Austin & Bird has done considerable lobbying for health care corporations.  We previously wrote that it "has earned more than $4.4 million lobbying so far this year for health care companies and trade groups including Novartis AG, Verax Biomedical, the American Hospital Association, St. Jude Children’s Research Hospital, and Aetna...."

Prior to his most recent lobbying work, Mr Hargan was a corporate lawyer, and then served in several purely administrative positions in DHHS during the George W Bush administration.  He also apparently served on the Trump transition team (per Wikipedia). 

I can see nothing that suggests he has any direct experience or expertise in actual health care, public health or biomedical science.  

Today, as reported, for example, by CBS, the Trump administration announced he will be acting Secretary of DHHS, the most powerful government health care official.  By the way, so far today, the brief pieces on this nomination (see also Politico, CNN, The Hill) have not mentioned his lobbying background, or lack of medical, health care, public health, or biomedical science experience. 

As we noted in our last, very recent post on the revolving door in health care, candidate Trump promised to "drain the swamp" in Washington, and specifically to avoid appointing lobbyists to government positions that could influence the fortunes of the companies for which they lobbied.

Yet here is a flagrant example of a lobbyist appointed to the highest US government health care position.  We have often discussed the revolving door affecting health care.  I believe this is the worst example so far I have seen.  We will have a man most expert in pushing policies to improve the fortunes of large health care corporations and their management, but who apparently knows little about health care, medicine, public health, or biomedical science, and has no record showing he particularly cares about patients' and the public's health.  This man is now in charge of the health care and public health operations of the US government. 



 Mr Trump, at least this doctor asks, have you no sense of decency?

So, to repeat in anguish what I have said before, most recently last week. 

The revolving door is a species of conflict of interest. Worse, some experts have suggested that the revolving door is in fact corruption.  As we noted here, the experts from the distinguished European anti-corruption group U4 wrote,


The literature makes clear that the revolving door process is a source of valuable political connections for private firms. But it generates corruption risks and has strong distortionary effects on the economy, especially when this power is concentrated within a few firms.

The ongoing parade of people transiting the revolving door from industry to the Trump administration once again suggests how the revolving door may enable certain of those with private vested interests to have excess influence, way beyond that of ordinary citizens, on how the government works, and that the country is still increasingly being run by a cozy group of insiders with ties to both government and industry. This has been termed crony capitalism. The latest cohort and now this most flagrant example of revolving door transits suggests that regulatory capture is likely to become much worse in the near future.

So, as we have said before [before, before...] The continuing egregiousness of the revolving door in health care shows how health care leadership can play mutually beneficial games, regardless of the their effects on patients' and the public's health.  Once again, true health care reform would cut the ties between government and corporate leaders and their cronies that have lead to government of, for and by corporate executives rather than the people at large.

Sunday, October 08, 2017

Round and Round It Spins - Our Latest Health Care Revolving Door Roundup

Sorry about the bad pun.  We have accumulated a remarkable number of stories of people transiting the revolving door from working for health care corporations in various but important capacities to positions in health care policy or regulation for the Trump administration.  These stories may not always appear in the most prominent places, but their accumulation suggests they should be of prominent importance.



As the New York Times reported on May 22, 2017, the Trump administration initially promised to drain the swamp, and specifically to prevent people who had lobbied the government from taking government positions with decision making power over their former employers' scope of interests.

President Trump signed an executive order in late January — echoing language first endorsed by Mr. Obama — that prohibited lobbyists and lawyers hired as political appointees from working for two years on 'particular' government matters that involved their former clients. In the case of former lobbyists, they could not work on the same regulatory issues they had been involved in.

Furthermore,

Both Mr. Trump and Mr. Obama reserved the right to issue waivers to this ban. Mr. Obama, unlike Mr. Trump, automatically made any such waivers public, offering detailed explanations. The exceptions were typically granted for people with special skills, or when the overlap between the new federal work and a prior job was minor.

However,

The Trump administration, in a significant escalation of its clash with the government’s top ethics watchdog, has moved to block an effort to disclose the names of former lobbyists who have been granted waivers to work in the White House or federal agencies.

The latest conflict came in recent days when the White House, in a highly unusual move, sent a letter to Walter M. Shaub Jr., the head of the Office of Government Ethics, asking him to withdraw a request he had sent to every federal agency for copies of the waivers. In the letter, the administration challenged his legal authority to demand the information.

In any case, information about people transiting the revolving door from health care lobbying firms has been coming out only in bits and pieces, as has information about people transiting from other health care positions.  I have been filing the information I can find about such people and present what I have found since May, 2017 here in chronological order.

Matthew Bassett from Senior Vice President for Government Affairs at Health Management Company myNEXUS to Assistant Secretary for Legislation at Department of Health and Human Services [DHHS]

Documented by the Nashville Post, May 5, 2017

Note that the article also stated that Mr Bassett "previously worked as a health care consultant and with ReviveHealth and DaVita"

Bruce Greenstein  from Health Care Technology Company Quartet to Chief Technology Officer, DHHS

As reported by Healthcare IT News on June 9, 2017

He previously

was CEO of Blend Health Insights, a consulting firm that advised health systems, payers, health IT companies and private equity firms in the U.S. and abroad on topics such as risk-based contracting, value-based purchasing and population health management.

Before that he

served as Secretary of the Department of Health and Hospitals in the administration of Louisiana Governor Bobby Jindal.

However

That position ended in controversy, however, when he resigned in 2013 amid accusations that he'd had improper communications related to a $197 million Medicaid contract awarded to a company, Client Network Services, Inc., where he had worked. Jindal canceled the contract, and Greenstein was indicted for perjury. The case was dismissed by the Louisiana Attorney General in 2016.

Oops. So in this case, there were at least previous allegations of corrupt behavior as well, although they remain unproven.

On June 15, 2017, the Intercept reported on several revolving door travelers.  These included:

Eric Hargan from Lobbying for UnitedHealthcare for Greenberg Traurig Alston & Bird to Deputy Secretary, DHHS

Also,

Paula Stannard  from Lobbying for UnitedHealthcare for Greenberg Traurig Alston & Bird to Senior Counselor to the Secretary, DHHS

Note that we previously posted on Ms Stannard's earlier position on a Trump "beachhead team" at DHHS.  At that time we noted that Greenberg Traurig Alston & Bird "has earned more than $4.4 million lobbying so far this year for health care companies and trade groups including Novartis AG, Verax Biomedical, the American Hospital Association, St. Jude Children’s Research Hospital, and Aetna...."

Randolph Wayne Pate from Vice President for Public Policy at Health Care Services Corporation to Associate Deputy Secretary, DHHS

That corporation operates Blue Cross Blue Shield plans in five states.

Keagan Lenihan from Lobbyist for McKesson Specialty Health to Senior Counselor, Secretary of DHHS

Note that we had posted about his previous position on a "beachhead team" here.

 The article also noted Lance Leggitt moving from Baker Donelson Bearman Caldwell & Berkowitz to Chief of Staff for the Secretary of DHHS.  We had previously posted about that position in May.

On June 21, 2017, Public Citizen published "The Swamp Nominees" which included 115 sub-cabinet appointments with questionable antecedents.   These included Mr Hargan, and Mr Bassett above.  They also included two people whom we had previously discussed, Dr Scott Gottlibe, Commissioner of the US Food and Drug Administration (FDA), Seema Verma, Administrator, Center for Medicare and Medicaid Services (CMS), and Brett Giroir, Assistant Secretary, DHHS.  However, there were quite a few more on ProPublica list, including...

Stephen Parente from Principal, Health Systems Innovation Network LLC to Assistant Secretary for Planning and Evaluation, DHHS

Robert Charrow from Greenberg Taurig LLP and Registered Lobbyist, Intrexon Corp to General Counsel, DHHS

Note that Mr Charrow as "principal shareholder" of Greenberg Taurig which "represents providers, scientists, pharmaceutical companies...."  I assume that this Greenberg Taurig is the same firm as that referred to as Greenberg Taurig Alston & Bird above.

Finally, on August 31, 2017, ProPublica reported,

Joe Grogan from Lobbyist from Gilead to White House Working Group on Drug Prices

Note that Gilead was first to market with a new group of extremely expensive drugs to treat hepatitis C.  As we have discussed, there is no evidence so far that these drugs avert the severe complications of hepatitis C or increase longevity.  Furthermore, per ProPublica

As reported by Kaiser Health News, internal documents from the working group show that, despite vows by President Trump to lower the price of medications, Grogan’s team is pushing pharma-friendly policies, such as extending a drug’s patent time in foreign markets. Grogan and the Office of Management and Budget did not respond to requests for comment.
This suggests that this particular instance of the revolving door is leading to regulatory capture.

Obama Administration Officials Transiting to Industry

During the same period, in the interest of fairness, we also note that some former Obama administration health care policy or regulatory officials now have industry positions, including

Dr Robert Califf former FDA Commissioner to Google subsidiary Verity

Per StatNews on May 17, 2017

Note that Dr Califf transited the revolving door in the opposite direction in 2015 when he became FDA leader, as we noted here.

Kevin Coulihan, former CEO of HealthCare.gov to Centene

Per the St Louis Post-Dispatch, August 2, 2017,

Drew Littman former Counselor for DHHS to Brownstein Hyatt Farber Schreck LLP

Per the Washington Examiner, Aug 14, 2017,

Note that this law firm has clients that "include companies in the healthcare and biotechnology fields."

Discussion

The revolving door has been a chronic problem for the US, but seems to only be getting worse.  We saw plenty of examples of people transiting the door to or from the US executive branch during the George W Bush and Obama administrations.  We are still seeing people transiting the door from the latter administration.  However, the number of people transiting the door into the Trump administration seems unprecedented, although admittedly that impression is based on series of cases, not systematic quantitative studies.

So, as I have said before, most recently in August, 2017,


The revolving door is a species of conflict of interest. Worse, some experts have suggested that the revolving door is in fact corruption.  As we noted here, the experts from the distinguished European anti-corruption group U4 wrote,

The literature makes clear that the revolving door process is a source of valuable political connections for private firms. But it generates corruption risks and has strong distortionary effects on the economy, especially when this power is concentrated within a few firms.

The ongoing parade of people transiting the revolving door from industry to the Trump administration once again suggests how the revolving door may enable certain of those with private vested interests to have excess influence, way beyond that of ordinary citizens, on how the government works, and that the country is still increasingly being run by a cozy group of insiders with ties to both government and industry. This has been termed crony capitalism. The latest cohort of revolving door transits suggests that regulatory capture is likely to become much worse in the near future.

So, as we have said before [before, before...] The continuing egregiousness of the revolving door in health care shows how health care leadership can play mutually beneficial games, regardless of the their effects on patients' and the public's health.  Once again, true health care reform would cut the ties between government and corporate leaders and their cronies that have lead to government of, for and by corporate executives rather than the people at large.

Sunday, October 01, 2017

Latest Legal Settlements Suggest Hazards of Making Pharmaceutical Regulation More Lenient, as is Apparently Favored by New FDA Leader

The new US Food and Drug Administration (FDA) commissioner Dr Scott Gottlieb is promoting making the agency's mechanisms to approve new drugs more lenient, according to the Cardiobrief blog.  Blogger Larry Husten wrote:

Gottlieb’s entire career has centered on loosening regulatory restrictions to enable industry to thrive. At the core of his philosophy is the view that with fewer restrictions the force of unbridled capitalism will unleash a torrent of industry innovation. In this view negative consequences, should they occur, will be quickly addressed by an efficient marketplace.

Should we trust pharmaceutical companies to innovate in such a light-touch regulatory climate?  On Health Care Renewal we have noted ethical violations by most of the major pharmaceutical companies, often involving deception in marketing, manipulation and suppression of clinical research, and distortions of dissemination of medical information, such as articles ghost-written by authors paid by industry.  We have documented numerous legal settlements of cases arising out of such misbehavior.

It is no surprise that more legal settlements have marched into view during the last few months to add weight to concerns about making regulation of the pharmaceutical industry more lax.  To summarize them, in chronological order...

Celgene Settled Allegations it Deceptively Marketed Thalidomid and Revlimid for $280 Million

Per the New York Times, July 25, 2017:

The pharmaceutical company Celgene has agreed to pay $280 million to settle claims that it marketed the cancer drugs Thalomid and Revlimid for unapproved uses, the company said on Tuesday.

Under the terms of the settlement, which resulted from a lawsuit filed by a whistle-blower — a former sales representative at Celgene — the company will pay $259.3 million to the United States and $20.7 million to 28 states and the District of Columbia.

In particular, years before the company got approval to market its drug Thalidomid (generic name: thalidomide, the same drug that caused severe birth defects when marketed in Europe in the 1950s)

sales of Thalomid quickly took off, in part because — as [whistle blower] Ms. Brown claimed in her complaint — Celgene 'flooded the country' with sales representatives who were under heavy pressure to pitch the drug to oncologists for a variety of cancers. The F.D.A. sent Celgene two warning letters, in 1998 and 2000, claiming the company had been marketing the drug to treat cancer. In 2000, one Wall Street analyst estimated that 90 percent of Thalomid’s sales were to treat cancer, according to Ms. Brown’s complaint.

However, the drug was not approved for use in cancer until 2006. Also,

in 2005, the company received approval to sell Revlimid for a rare cancer, and Ms. Brown’s complaint claims that the company — as it had with Thalomid — marketed it to treat a broader range of cancers. It also pressured doctors to switch Thalomid patients to Revlimid, which is more expensive.

Ms. Brown’s complaint also claimed that Celgene’s inappropriate marketing of Thalomid exposed patients to heightened risks that included potentially fatal blood clots and other side effects. Those risks were added to the drug’s warning label only after it received the approval for cancer treatment, Mr. Guttman said.

Thus the company's actions may well have harmed patients.

We previously discussed, most recently in 2010, the immense price Celgene charged for Thalidomid, despite the fact that this compound, developed about 60 years ago, is available for pennies in many countries.  

Nonetheless, and also despite the amount of money that Celgene was making selling its drugs for unapproved uses (e.g., Revlimid's sales last year were nearly $7 billion), the US Department of Justice declined to get involved in this case.  Also, like most legal settlements involving big health care organizations, the company did not admit any wrongdoing, and no person who enabled, approved, or directed the misbehavior suffered any negative consequences.

Insys Settled Allegations of  Promotion of Narcotics for Unapproved Uses for $4.5 Million to Illinois

Per the Chicago Tribune, August 18, 2017:

An Arizona drug company has agreed to pay Illinois $4.45 million to settle allegations that it deceptively marketed and sold a prescription opioid drug for uses not approved by the U.S. Food and Drug Administration.

Insys' actions may well have contributed to the current opioid epidemic.

The company heavily marketed the drug to Illinois doctors with records of prescribing high volumes of opioids regardless of whether those doctors were prescribing opioids to treat cancer pain, the state alleged.

In particular,

According to Madigan's office, the top prescriber of Subsys in Illinois was Dr. Paul Madison, who wrote about 58 percent of all prescriptions for the drug in the state despite treating few, if any, cancer patients. Madison, an anesthesiologist and former owner of the Watertower Surgicenter on North Michigan Avenue in Chicago, was indicted in 2012 by the U.S. attorney's office in Chicago for billing insurers for procedures he didn't perform, and his medical license was suspended in November, according to Madigan's office.

We previously discussed Insys' stealth public relations campaign against medical marijuana here.

However, as in the previous case, the US DOJ was not involved, the company did not admit wrongdoing, and no individual involved in the misbehavior paid any penalty.

Novo Nordisk Settled Allegations it Minimized Risks of Victoza for Nearly $58.7 Million

Per Reuters, September 5, 2017:

Novo Nordisk will pay nearly $58.7 million to resolve claims the drugmaker’s sales staff downplayed the importance of U.S. Food and Drug Administration-mandated warnings about the cancer risks of its diabetes medication Victoza.

The U.S. Justice Department said Tuesday’s settlement would resolve claims Novo Nordisk supplied its sales representatives with information to give to doctors that created the false or misleading impression that warnings were wrong or unimportant.

In particular,

The lawsuit said that program required Novo Nordisk to provide doctors information about the potential risk of a rare form of cancer associated with the drug, which gained FDA approval in 2010.

Victoza’s FDA-approved labeling also contained a boxed warning related to that form of thyroid cancer, the lawsuit said.

Novo Nordisk’s sales force employed messages and tactics that created a false or misleading impression with doctors regarding the cancer risks, leading some physicians to be unaware of them, the lawsuit said.
Thus, again this company's actions appeared to pose a risk to patients.

This company also has a track record of ethical misadventures.  In 2011, we discussed several previous settlements by Novo Nordisk.  Nonetheless, the US DOJ decided not to be involved in this litigation, which, as in the other cases above, did not result in admission of wrongdoing, nor any penalities for individual involved in the misbehavior.

Novelion Subsidiary Aegerion Pleaded Guilty, Fined $40 Million for Misbranding Juxtapid by Minimizing its Adverse Effects

Per Reuters, September 22, 2017:

Aegerion Pharmaceuticals Inc will plead guilty to two misdemeanors and pay $40.1 million to resolve investigations into its marketing and sales of an expensive cholesterol drug, U.S. authorities said on Friday.

The settlements will resolve long-running investigations into Aegerion, a subsidiary of Canada’s Novelion Therapeutics Inc, by the U.S. Justice Department and the U.S. Securities and Exchange Commission related to its drug Juxtapid.

In particular,

Prosecutors said after the U.S. Food and Drug Administration in 2012 approved Juxtapid for treating a rare genetic condition that causes high cholesterol, Aegerion promoted it for patients who had not been diagnosed with the condition.

Juxtapid, which cost $250,000 to $300,000 annually per patient, featured a black box warning on its label that it could cause serious liver and stomach problems, prosecutors said.

Sales representatives also were trained to tell doctors and patients that Juxtapid would 'take patients out of harm’s way' and prevent 'impending' heart attacks and strokes, despite the lack of data supporting those claims, prosecutors alleged.

Numerous patients discontinued using Juxtapid after suffering conditions including liver toxicity and gastrointestinal distress, prosecutors said.
Thus, once more, the company's actions appeared to result in patient harm.

The company also signed a deferred prosecution agreement.  By pleading guilty, it admitted the misbehavior in this case.  However, again no individual involved in the misbehavior faced any penalties, despite the severe nature of the adverse effects the company deceptively minimized.

AmeriSourceBergen Settled For $260 Million Allegations of Illegally Selling Repackaged, Perhaps Adulterated Drugs so as to Avoid FDA Regulation

Per Modern Healthcare, September 27, 2017:

AmerisourceBergen Specialty Group, a wholly-owned subsidiary of the major wholesale drug distributor AmerisourceBergen Corp., pled guilty to illegally distributing misbranded drugs and agreed to pay $260 million to resolve criminal liability for skirting regulatory oversight.

Between 2001 and 2014, according to court records unsealed Wednesday, the group's now-defunct subsidiary Medical Initiatives prepared millions of syringes that had been filled with cancer drugs and shipped them to providers in all 50 states.

Medical Initiatives removed the drugs from their original glass vials and repackaged them into plastic syringes in an unclean and unsterile environment, allowing the company to sell excess drug product in the vials known as 'overfill,' according to court records. It combined the contents of multiple vials in a process known as 'pooling,' despite many of the vials carrying a 'single-use' designation.

In order to avoid the Food and Drug Administration's regulatory oversight, AmerisourceBergen Specialty Group did not register Medical Initiatives as a repackager or manufacturer with the agency, records show. Instead, the group portrayed Medical Initiatives as a state-regulated pharmacy, exploiting an exemption to the FDA registration requirement that is reserved for legitimate pharmacies, not for manufacturers or repackagers, authorities said.
Given the problems with sterility, again the company's actions possibly could have harmed patients.

However, yet again, this settlement did again involve a guilty plea, but again no individual involved in the repackaging and adulteration suffered any negative consequences.

Discussion

All the cases discussed above were of behavior that could have harmed patients.  Many of the companies involved had records of previous ethical misadventures.  While a few cases resulted in corporate guilty pleas (to misdemeanors), none resulted in monetary penalties that would have much impact on the companies' finances, and none resulted in any negative consequences for people who enabled, authorized, directed or implemented the bad behavior.


These, just the latest in the march of legal settlements by large health care organizations, again demonstrate how often and how seriously pharmaceutical companies (and other organizations) may misbehave, and how the leaders of these organizations exhibit continued impunity, never having any legal accountability for their organizations' actions.  These settlements again demonstrate the relatively light touch US regulators, including the FDA and DOJ, have exhibited when dealing with these organizations.

So what could happen if that touch is lightened still more, particularly by the ongoing initiatives of the current US FDA leader?  I submit the results will be higher drug prices, more use of minimally effective and/or seriously risky drugs, and larger compensation for top managers of pharmaceutical companies.  Will the public actually also get access to "life saving" drugs?  Perhaps, but most of the offerings of drug companies in the last years have had minimal efficacy, and rarely have been proven to extend life.

Why is Dr Gottlieb pursuing these initiatives?  Is he a true believer in market fundamentalism, perhaps untrammeled by lack of evidence supporting it?

Maybe he as he become intoxicated by all the money he previously made from the pharmaceutical industry.  Prior to his approval by the Senate, his extensive financial dealings with the pharmaceutical industry were detailed by the New York Times, and Stat News, among others.  The NYT article said:

The nominee, Dr. Scott Gottlieb, has spent the bulk of his career working in the drug and health care industry, which experts say raises the potential for myriad conflicts of interest. If confirmed to head the F.D.A., he would wield considerable power over companies and investment firms that have paid him millions of dollars over the years. From 2013 to 2015, for example, Dr. Gottlieb received more than $150,000 to advise Vertex Pharmaceuticals, a company whose two approved drugs are seen as breakthrough treatments for cystic fibrosis but carry list prices of more than $250,000 a year. He’s the acting chief executive of Cell Biotherapy, an early-stage cancer biotech firm that he helped found. He has served for years as a consultant to pharmaceutical giants like GlaxoSmithKline and Bristol-Myers Squibb and is paid by other companies for his expertise.
So Dr Gottlieb's move to the FDA was yet another example of the revolving door pheonomenon.



The Stat article concluded,

It also reflects the normalization of conflicts of interest in medicine, which has been debated in the pages of the New England Journal of Medicine and in the Lown Institute blog.

Gottlieb has criticized government efforts to shed light on conflicts of interest, such as the Physician Sunshine Act, as 'federal tinkering' leading to “the demise of American medicine.” We believe his confirmation will lead to the demise of some FDA rules that are already barely keeping a lid on useless or dangerous medical products.

That may not be so far in the future, if Husten's concerns mentioned at the top of this post are true. And when conflicts of interest start having such real world effects, they cease to be merely conflicts of interest, but become corruption.

We have long been railing against conflicts of interest and corruption.  Until recently we noted only some conflicts of interest affecting US government leaders, most often in the form of the revolving door.  Most of the conflicts we discussed involved health care professionals and leaders of health care organizations.

So we used to write things like this (in July, 2016):

True health care reform would first make transparent the web of institutional and individual conflicts of interest that seems to tie together nearly all big health care organizations, and open discussion of how to make health care organizations better serve health care rather than the narrow financial interest of their top leaders.

Or this (in June, 2016):

True health care reform would first expose these conflicts, then reduce or better yet, eliminate them, and make health care more about helping patients and less about making money by marketing commercial products.

However, since the last presidential campaign, more and more conflicts of interest and apparent examples of corruption involving President Trump, his family, and his ongoing business interests have appeared, so that at this time the Trump regime seems to be riddled with conflicts of interest and corruption (for example, see these lists compiled by the Sunlight Foundation and Newsweek).  Conflicts of interest and corruption involving the highest levels of US government have even more potential to damage patients' and the public's health than those involving, say, physicians or hospital CEOs.

 So we now must say that true health care reform in the US first requires vast reduction in the conflicts of interest and corruption of the leaders of US government.