BLOGSCAN - More Detailed Allegations About Intimidating an Avandia Whistle-Blower

On PharmaLot, this post adds some detail to previous allegations (which we most recently discussed here), that top executives, now including the top-most executive at GlaxoSmithKline tried to silence an academic physician who had doubts about the safety of rosiglitazone (Avandia). This is another reminder of the lack of transparency of the pseudo-market in pharmaceuticals. As we have said before, of course, intimidating people who blow the whistle about drug safety concerns is bad not only for the whistle-blowers, but for patients and doctors whose decisions about which treatments to give ought to be based on critical review of the best possible clinical evidence, not evidence that is filtered by secrecy and intimidation to only reflect vested interests of the makers of the treatments.

The Comparative Effectiveness Kerfuffle: An Argument for Restoring Control of Clinical Research to Doctors

Introduction: How to Make the Best Clinical Decisions?

Physicians spend a lot of time trying to figure out the best treatments for particular patients' problems. Doing so is often hard. In many situations, there are many plausible treatments, but the trick is picking the one most likely to do the most good and least harm for a particular patient. Ideally, this is where evidence based medicine comes in. But the biggest problem with using the EBM approach is that often the best available evidence does not help much. In particular, for many clinical problems, and for many sorts of patients, no one has ever done a good quality study that compares the plausible treatments for those problems and those patients. When the only studies done compared individual treatments to placebos, and when even those were restricted to narrow patient populations unlike those patient usually seen in daily practice, physicians are left juggling oranges, tomatoes, and carburetors.

Comparative effectiveness studies are simply studies that compare plausible treatments that could be used for patients with particular problems, and which are designed to be generalizable to the sorts of patients usually seen in practice. As a physician, I welcome such studies, because they may provide very useful information that could help me select the optimal treatments for individual patients.

Because I believe that comparative effectiveness studies could be very useful to improve patient care, it upsets me to see this particular kind of clinical study get caught in political, ideological, and economic battles.

The Comparative Effectiveness Kerfuffle

Therefore I have been dismayed to see the concept of comparative effectiveness studies get trashed in the main stream media. It is, of course, possible that some people are promoting comparative effectiveness studies for their own political, economic, or ideological reasons. And maybe such promotion deserves rebuttal. But just because some people may promote comparative effectiveness studies for the wrong reasons does not mean that such studies are a bad idea. In my humble opinion, as a physician, stifling such studies will stifle an opportunity to improve clinical decision making and improve patients' outcomes.

So when an op-ed piece in the Washington Times asserted that comparative effectiveness studies "can kill," and then based that argument on complete misunderstanding of several clinical issues and misinterpretation of clinical research studies, I felt that I should respond.

Rebutting the DrugWonks Rebuttal

Robert Goldberg, Vice President of the Center for Medicine in the Public Interest, has just rebutted my response, in a comment on my original post, and on his own blog, DrugWonks.com.

His reply, like his op-ed, seemed to be based on misunderstandings of the clinical context, and misinterpretation of the clinical research literature.

His first main point was:

1. You treat congestive heart failure with anti-hypertension drugs. Ask any doctor.

It is true that many drugs used to treat congestive heart failure (CHF) are also used to treat hypertension. These include diuretics, used to treat all forms of CHF, and angiotensin-converting enzyme inhibitors (ACEIs), beta-blockers, and angiotensin-receptor blockers (ARBs), used to treat CHF with systolic dysfunction (decreased pump function of the heart, as opposed to diastolic dysfunction, increased wall stiffness). But many drugs used to treat hypertension have not been demonstrated to benefit patients with CHF. For example, calcium-channel blockers have not been shown to be of benefit in CHF with systolic dysfunction.

Some treatments of CHF are not useful for hypertension, most notably digoxin and similar drugs, which seem to decrease symptoms and improve physical functioning (although they don't improve longevity) for CHF and systolic dysfunction.

In any case, just because some drugs work both for hypertension and for CHF does not mean that studies of the drugs of patients with one of these conditions provide results that can be extrapolated to patients with the other condition.

So Goldberg's sentence is at best partially true, but even so, is not relevant to the arguments he made in his original Washington Times op-ed.

Regarding his second sentence: 1 - I am a doctor, licensed in multiple states, and board-certified in Internal Medicine. 2 - I have written several research reports on CHF that were published in major journals. (1-3)

His second main point was:

I will refer you to the A-HeFT study and it's design which included BiDIl with OTHER anti-hypertensives to prolong survival from congestive heart failure.

I agree that the study compared BilDil, a fixed combination of isosorbide dinitrate and hydralazine, to placebo for CHF among African-American patients. Patients continued to take other CHF medications, including diuretics, ACEIs, ARBs, beta-blockers digoxin, and spironolactone.(4) But that is irrelevant to Goldberg's argument in his Washington Times article, which seemed to be based on the notion that BilDil should be used to treat hypertension, not CHF.

His third main point was to provide a quote, out-of-context and whose origin was unclear, attacking the ALLHAT study with adjectives and generalities. However, this quote does not support the specific criticisms of the ALLHAT study that Goldberg made in his Washington Times article. He asserted that patients were allowed to switch from the original assigned therapy only if they suffered a severe adverse effect, and that the primary result of the study was that diuretics were the most cost-effective drug. Both these assertions are not supported by the published reports of the ALLHAT study, as I discussed in detail in my previous post.

Goldberg concluded with a personal attack on me, one that is fairly ridiculous given my background and experience as briefly mentioned above. Goldberg also mounted a shrill attack on the comparative effectiveness movement, asserting that it arises from people "hating drug companies, "places the cost of drugs over the quality of human life," is based on hostility to "corporate capitalism," and is an example of "the end justifies the means."

Perhaps some people advocate comparative effectiveness research for these reasons. I certainly don't.

Summary: the Real Reason to Do Comparative Effectiveness Research

I advocate comparative effectiveness research because it has the potential to improve the decisions that us doctors make on behalf of patients, increasing the likelihood that patients will have good effects from treatment, and minimizing the possibility of side-effects.

If we allow clinical studies that realistically compare plausible therapies of conditions for various sorts of patients to become a political football, we will lose a major opportunity to improve patient care.

The current kerfuffle suggests it is time to return more control of medical research to physicians, who, after all, swore oaths to put the needs of patients ahead of other concerns, and let those with vested political, ideological, or economic interests argue over something else.

ADDENDUM (1 October, 2007) - On 27 September, I attempted to add comments on the DrugWonks.com post to which I referred above. As of today, those comments have not appeared.

Also, another post on DrugWonks.com on 27 September included "I guess taking money from organizations that switch people from one molocule to another without telling patients is okay for bloggers like Health Care Renewal." I have never, and I don't think any Health Care Renewal blogger has ever suggested they approve of switching patients without their (or their physicians') permission from one medication to another. Furthermore, a quick perusal of Health Care Renewal would indicate that we are as skeptical and critical of health care insurers and managed care organizations as we are of pharmaceutical companies, and we have been critical of conflicts of interest related to either type of company.

References

1. Poses, RM, Smith WR, McClish DK, Huber EC, Clemo FLW, Schmitt BP, Alexander-Forti D, Racht EM, Colenda CC, Centor RM. Physicians’ survival predictions for patients with acute congestive heart failure. Arch Int Med 1997;157:1001-1007.
2. Poses RM, McClish DK, Smith WR, Huber EC, Clemo FLW, Schmitt BP et al. Results of report cards for patients with congestive heart failure depend on the method used to adjust for severity. Ann Intern Med 2000;133:10-20.
3. Smith WR, Poses RM, McClish DK, Huber EC, Clemo FLW, Schmitt BP et al. Prognostic
judgments and triage decisions for patients with acute congestive heart failure. Chest 2002;121:1610-1617.
4. Taylor AL, Ziesche S, Yancey C et al. Combination of isosorbide dinitrate and hydralazine in blacks with heart failure. N Eng J Med 2004; 351: 2049-2057. Link here.

Haunted Health Care: the Scope of Ghost Management

An important new article in PLoS Medicine expanded thinking about the involvement of pharmaceutical companies (and possibly other health care corporations) in the shaping of clinical research. [Sismondo S. Ghost management: how much of the medical literature is shaped behind the scenes by industry? PLoS Med 4(9): e286 doi:10.1371/journal.pmed.0040286]

Sismondo defined ghost management of medical research and publishing:

when pharmaceutical companies and their agents control or shape multiple steps in the research, analysis, writing, and publication of articles. Such articles are 'ghostly' because signs of their actual production are largely invisible—academic authors whose names appear at the tops of ghost-managed articles give corporate research a veneer of independence and credibility. They are 'managed' because those companies shape the eventual message conveyed by the article or by a suite of articles.

Sismondo thus went beyond the issue of ghost-writing, the contribution of unnamed authors who may be influenced, or hired, by pharmaceutical companies or other organizations with vested interests. (See recent post here.) He also went beyond the issue of how pharmaceutical companies and other research sponsors may attempt to influence the design and implementation of research studies, the analysis of their results, and/or how the results are reported. (See this post.)

As Sismondo noted,

It has been repeatedly and firmly established that pharmaceutical company funding strongly biases published results in favor of the company's products. Ghost management amplifies that bias, because when one set of commercial interests exerts influence at multiple stages of research, writing, and publication, it will shape the resulting article. In turn, bias affects medical opinion and practice, and ultimately, patients.

Sismondo also attempted to estimate the prevalence of ghost management. This would have been predicted to be a difficult task, because,

it is not in the interests of writers, authors, or sponsors and their agents to reveal ghost management processes; hence a number of the published accounts of ghost management have stemmed from legal proceedings and investigative journalism.

So he set out to review existing evidence and find some new evidence.

First he noted the article by Healey and Cattall, based on documents produced during legal proceedings, that explained how Pfizer Inc ghost managed publications of multiple articles on the drug sertraline [Zoloft], producing 85 manuscripts, and accounting for an important part of the literature on this one drug. (See previous post here.)

An important contribution by Sismondo was what he called his "supply-side analysis."

A survey in 2001 identified 182 MECCs in the United States, up from 153 in 1998. A number specialize in producing, placing, and tracking journal articles, known in the trade as 'publication planning' or 'strategic communication planning.' While these firms hide details of their work—from potential critics and competitors—they also energetically promote themselves and their services.

I spent six hours searching web pages for MECCs offering publication planning or similar or overlapping services to the pharmaceutical industry, and found 23 (list available from the author). This is not an estimate of the number of such firms, but indicates how common they are. There may be many more firms providing publication planning, including some not uncovered in this search, and some not advertising these services on the Internet.

In a primer on publication planning, the director of one MECC defines the activity as: 'gaining product adoption and usage through the systematic, planned dissemination of key messages and data to appropriate target audiences at the optimum time using the most effective communication channels'.

Complete Healthcare Communications (CHC) claims on its banner that it 'has honed the systems and skills needed to develop the intellectual heart of pharmaceutical marketing—the publication plan. The result for your product? A continuum of awareness, interest, and prescriber confidence.'

CHC includes among its clients Pfizer, Sanofi-Aventis, Ortho Biotech, Wyeth, Schering-Plough, Shire, AstraZeneca, and other pharmaceutical companies.

Other agencies offer very similar services. As described in an article by three of its managers, the Medical Knowledge Group starts publication planning with a phase of exploring 'key messages' and 'author/journal options' before designing any publications to incorporate those messages

Another MECC, Envision Pharma, says that 'data generated from clinical trials programs are the most powerful marketing tools available to a pharmaceutical company.' Envision will work from early on in the process to ensure 'consistent message dissemination,' will plan and track the 'data dissemination plan,' and will produce 'scientifically accurate, commercially focused abstracts, posters, and primary and secondary publications'

Several of the publication planning firms identified are owned by major publishing houses. For example, Excerpta Medica is 'an Elsevier business' and writes that its 'relationship with Elsevier allows… access to editors and editorial boards who provide professional advice and deep opinion leader networks.'

Wolters Kluwer Health draws attention to its publisher Lippincott Williams & Wilkins, with 'nearly 275 periodicals and 1,500 books in more than 100 disciplines,' and to Ovid and its other medical information providers, emphasizing the links it can make between its different arms

Vertical integration is attractive in the industry as a whole: at least three of the world's largest advertising agencies own not only MECCs, but also CROs.

Ghost management of medical journal publications is clearly a substantial business, employing thousands of marketers, writers, and managers. It is large enough that the industry has established the International Publication Planning Association.

The conclusion is that

Given the amount of data that pharmaceutical companies control, the number of publication planning agencies that openly advertise on the Internet, the number of medical writers, the existence of two associations for publication planners, and meetings organized and reports written for them, we can conclude that ghost management is common.

Why is it so important?

Articles in medical journals have real effects upon physician prescribing behavior, which is why pharmaceutical companies invest so much in their publication. Journal articles are heavily used in detailing, to validate claims and rebut worries. Even independent of detailers, responsible physicians and medical researchers search the literature to gather evidence about the best treatments. Published scientific articles are the sources of medical information with the highest authority. Systematic reviews and meta-analyses almost all start with the published literature—so even fully independent reviews are influenced by ghostly activities.

It is clear that ghost management is a major part of the production of pseudoevidence-based medicine.

Sismondo's article is an important contribution to our knowledge of how research on human beings is manipulated into marketing and propaganda, if not outright disinformation. Such practices break the trust of research subjects who thought they were participating to advance science and medical care. Such practices mock physicians who think they are trying to make decisions based on clinical science. Such practices can harm patients who are subjected to tests and treatments based on hype and manipulation rather than unbiased data.

Sismondo ended with some suggestions for alleviating the problem, but noted,

There are no straightforward solutions, short of large changes to the nature of medical publishing and/or research, changes that would effectively sequester pharmaceutical company funding from research and publishing....

We have now said frequently that there are many reasons to think about whether organizations who have a vested interest having clinical research produce particular results should be banned from funding or other involvement in research on human beings. The probably pervasive practice of ghost management is another strong reason to consider this seemingly extreme step.

In the absence of such a drastic prohibition, all I could suggest is a much strengthened and more comprehensive disclosure policy. Many would now agree that all clinical trials should be registered. Such registration should include details of any involvement of pharmaceutical, biotechnology, device and similar companies in the design and implementation of the research, and the analysis and reporting of its results. Any involvement by contract research organizations, for-profit institutional review boards, medical education and communication companies, and the like should be disclosed in trial registration.

Furthermore, there should be full disclosure of all involvement by any of these organizations accompanying any publication or presentation of study results, including publications in peer-reviewed journals, abstract presentations, etc.

Furthermore, the penalties for concealing involvement of any of these organizations should be severe, all the way up to considering failing to disclose as potential criminal fraud.

Allowing ghost management to continue victimizes people who volunteer to participate in research, mocks physicians who try to base their clinical decisions on the best available evidence, and hurts patients.

Hat tip to the Medical Humanities Blog, and one of our corps of Health Care Renewal scouts.

BLOGSCAN - Review of Fixing American Healthcare

On the Health Business Blog, this post by David Williams favorably reviews the just published book by Richard N. Fogoros, Fixing American Healthcare; Wonkonians, Gekkonians and the Grand Unification Theory of Healthcare. Fogoros blogs on the Covert Rationing Blog.

Banning Logo Coffee-Mugs, Soliciting $5 Million Donations

A story from the Connecticut Business Journal suggests the extent that medical schools now seek money from for-profit health care corporations.

The Yale School of Medicine has mounted an aggressive fundraising campaign targeting drug makers, according to internal university documents recently reviewed by Business New Haven.

The documents, part of a confidential briefing for School of Medicine Dean Robert Alpern, outline an effort to raise more than $40 million in philanthropic dollars through 2008 from pharmaceutical companies.

Fund-raising efforts involving specific pharmaceutical companies included,

• "a suggestion to send Yale President Richard C. Levin to Germany to meet with Bayer Pharmaceutical's president to help secure $5 million in funding for the new Yale Cancer Center."
• "Merck & Co., under fire in recent years in the Vioxx scandal, is targeted for a $5 million appeal for the Yale Mouse Phenotyping Center, Yale officials confirmed. "
• "Yale has a particularly close relationship with Pfizer, which opened a clinical research facility adjacent to the university in 2005. Pfizer and the university also collaborated on the Yale Positron Emission Tomography Center, which opened earlier this year with help from a $5 million gift from the drug maker and a pledge of $2 million a year in research funding. "

The size of the total fund-raising effort is notable.

Corporate and foundation donations make up about 25 percent of Yale's annual fundraising take, [Vice President for Development Inge] Reichenbach says, with the rest coming from alumni donations. The pharmaceutical company push is part of a larger five-year effort, which includes a $100 million campaign for the Yale Cancer Center.

Reichenbach says that development officials often highlight links between ongoing research and a company's interests. Pharmaceutical companies have a natural stake in medical research and fund efforts on all levels at many schools, she adds.

'Basically we are making matches. That's what we do, we provide matches of interest,' Reichenbach says. 'When you have a medical school, it's a pretty obvious match.'

While Yale drums up such corporate funding, it has cracked down on relatively small transactions between individual faculty and commercial health care organizations.

Yale has in fact been at the forefront of cracking down on drug company efforts to influence individual researchers and clinicians, says David Rothman, a professor of social medicine at Columbia University and associate director of the Prescription Project, an effort to limit conflicts of interest in academic medicine.

A former Yale professor serves on the Prescription Project's advisory committee and drafted a series of cutting-edge guidelines for Yale on 'impeccable financial relationships between the pharmaceutical industry and physicians.' The guidelines restrict doctors' access to free meals and samples offered by companies.

There seems to be a striking contrast between how Yale addresses possible conflicts of interest affecting individual faculty, and how it addresses institutional conflicts of interest.

Yale has guidelines and an internal committee that probes for conflict of interest in research, says Stephanie Spangler, deputy provost for biomedical and health affairs. Any research funded by corporations is governed by strict set of rules and subject to peer review.

Much of Yale's formal ethics rules govern doctors and their interactions with pharmaceutical company representatives, long known for handing out free gifts and meals in an attempt to influence prescription-writing habits.

"We work very hard at an institutional level to make sure that any institutional relationships we have don't reach the individual clinician," Spangler says.

But there are no ethical guidelines in place regarding philanthropic gifts and their effects on research priorities. 'There's a spectrum of outside interests,' Spangler says. 'There aren't bright lines and hard and fast rules.'

That struck one external observer, Merrill Goozner, as hypocritical.

'Yale has put itself up for sale,' says Merrill Goozner, director of the Integrity in Science project at the Center for Science in the Public Interest in Washington, D.C. 'That's a fairly sad day for academic medicine.'

'The reality is that pharmaceutical company influence over the nation's medical schools is pervasive and unfortunate because it's skewing research,' Goozner says. 'You would think that medicals schools would take greater precautions, that they would draw a bright line.'

Even Rothman conceives that there is room for improvement.

Rothman of the Prescription Project says it may be time for the focus of concern over drug company influence to shift from individual doctors and researchers to universities as a whole.

'Is it an important issue? Absolutely. Is a frontier issue? Absolutely,' Rothman says. 'This kind of material compels us to go up one notch and start thinking long and hard about institutional conflict of interest.'

We have noted before that academic institutions which seem to be willing to ban financially small conflicts of interest affecting students and faculty seem unwilling to address larger conflicts affecting top leaders and the institution as a whole. Obviously, it is easier for leaders to tell their medical students not to accept coffee mugs or pizza from pharmaceutical company x than to themselves forego lucrative consulting agreements, or memberships in speakers bureaus or even boards of directors.

The temptation of corporate largesse is that it allows the leadership to continue to live in the style to which they have become accustomed. But if leaders are really worried how much a coffee mug may influence how a medical student thinks, they should be much more worried how much a $5 million donation may influence how they themselves think.

Fixing Students Grades at UMDNJ

Here we go again. We have done a long series of posts about the troubles at the University of Medicine and Dentistry of New Jersey (UMDNJ), the largest US health care university.

The university now is operating under a federal deferred prosecution agreement under the supervision of a federal monitor (see most recent posts here, here, here, here and here.) We had previously discussed allegations that UMDNJ had offered no-bid contracts, at times requiring no work, to the politically connected; had paid for lobbyists and made political contributions, even though UMDNJ is a state institution; and seemed to be run by political bosses rather than health care professionals. (See posts here, and here, with links to previous posts.) A recent development (see post here with links to previous posts) was that UMDNJ apparently gave paid part-time faculty positions to some community cardiologists in exchange for their referrals to the University's cardiac surgery program, but not in exchange for any major academic responsibilities. Another was some amazingly wasteful decisions by UMDNJ managers leading to spending millions of dollars for real-estate that now stands vacant (see post here). Another was the indictment of a powerful NJ politician for getting a no-work job in the system, and the indictment of the former dean of the university's osteopathic medicine school for giving him the job (see post here). Most recently, we found out that UMDNJ had named one of its teaching hospitals for a pharmaceutical company in 2001 (see post here).

The very latest story comes to us courtesy of the Newark Star-Ledger,

Paul Mehne was a popular dean on the Camden campus of the state’s medical school, well-liked by the small cadre of students there who felt their satellite program in South Jersey was something special.

What troubled investigators, however, is that none of his students ever seemed to fail. A new report by a federal monitor, scheduled to be released tomorrow, concludes that Mehne doctored the grades of several medical school students, including some now practicing medicine, giving passing test scores to those who came up short on exams needed to begin specialty rotations.

Mehne, 59, associate dean for academic and student affairs who headed the University of Medicine and Dentistry of New Jersey’s Camden campus, was abruptly relieved of his duties three months ago without explanation just weeks before he was scheduled to retire.

In the report, the monitor said some students at Camden were the beneficiaries of what it called 'unethical and inappropriate' activities related to grading.

The report said all grades were first sent to Mehne before being submitted to the registrar. The monitor said Mehne also coerced the directors of medical clerkships - the special rotations taken by third- and fourth-year medical students in areas such as obstetrics or family medicine - to award passing grades to students who did not pass standardized tests.

n one case cited in the monitor’s report, the source said an unidentified student who had failed an exam upon completing a specialty rotation was never retested. The report said Mehne instructed the clerkship director to change the student’s grade on two separate occasions.

According to the sources, no Camden students were brought up before the Academic Standing Committee for grade failures while Mehne was dean, until the monitor began his investigation.

This is a different kind of unethical behavior than that found previously at UMDNJ.

The lesson seems to be that mismanagement and unethical leadership at the top allows all sorts of mischief to flourish among the middle management.

[I must disclose that my first faculty position was at the UMDNJ Camden campus, which I left in 1987.]

ADDENDUM - See also comments on Phi Beta Cons here.

A Web of Deception Ensnares US Nursing Homes

The New York Times just published a report of some important investigative reporting about changes in how US nursing homes are currently managed, or mismanaged, leading to bad effects on patients' outcomes and safety. As an example, the report recounted the case of an elderly women who died in the Habana Health Center in Tampa, FL. The article made a series of key points,

• The homes were acquired by private equity companies not usually associated with health care.
• The companies drastically cut the costs of their acquisitions.
• These cost cuts decreased care, apparently leading to poor outcomes.
• The private equity companies set up complex corporate structures for their acquisitions, hiding their ownership, and thwarting lawsuits and regulation.

I have summarized supporting quotes for each point below.

Acquisition by Private Equity Companies

The changes seem to stem from the acquisition of many nursing homes and nursing home chains by "large Wall Street investment companies .... Those investors include prominent private equity firms like Warburg Pincus and the Carlyle Group, better known for buying companies like Dunkin’ Donuts. As such investors have acquired nursing homes, they have often reduced costs, increased profits and quickly resold facilities for significant gains."

The acquisitions involved were substantial. "But in recent years, large private investment groups have agreed to buy 6 of the nation’s 10 largest nursing home chains, containing over 141,000 beds, or 9 percent of the nation’s total. Private investment groups own at least another 60,000 beds at smaller chains and are expected to acquire many more companies as firms come under shareholder pressure to sell."

Drastic Cost Cutting

The major manifestations of mismanagement seem to be drastic cost cutting.

'The first thing owners do is lay off nurses and other staff that are essential to keeping patients safe,' said Charlene Harrington, a professor at the University of California in San Francisco who studies nursing homes. In her opinion, she added, 'chains have made a lot of money by cutting nurses, but it’s at the cost of human lives.'

The Times’s analysis of records collected by the Centers for Medicare and Medicaid Services reveals that at 60 percent of homes bought by large private equity groups from 2000 to 2006, managers have cut the number of clinical registered nurses, sometimes far below levels required by law. (At 19 percent of those homes, staffing has remained relatively constant, though often below national averages. At 21 percent, staffing rose significantly, though even those homes were typically below national averages.) During that period, staffing at many of the nation’s other homes has fallen much less or grown.

Nurses are often residents’ primary medical providers. In 2002, the Department of Health and Human Services said most nursing home residents needed at least 1.3 hours of care a day from a registered or licensed practical nurse. The average home was close to meeting that standard last year, according to data.

But homes owned by large investment companies typically provided only one hour of care a day, according to The Times’s analysis of records collected by the Centers for Medicare and Medicaid Services.

For the most highly trained nurses, staffing was particularly low: Homes owned by large private investment firms provided one clinical registered nurse for every 20 residents, 35 percent below the national average, the analysis showed.

Poor Patient Outcomes

In turn, such cost cutting was associated with poor outcomes.

The typical nursing home acquired by a large investment company before 2006 scored worse than national rates in 12 of 14 indicators that regulators use to track ailments of long-term residents. Those ailments include bedsores and easily preventable infections, as well as the need to be restrained. Before they were acquired by private investors, many of those homes scored at or above national averages in similar measurements.

In addition,

Regulators with state and federal health care agencies have cited those staffing deficiencies alongside some cases where residents died from accidental suffocations, injuries or other medical emergencies.

Federal and state regulators also said in interviews that such cuts help explain why serious quality-of-care deficiencies — like moldy food and the restraining of residents for long periods or the administration of wrong medications — rose at every large nursing home chain after it was acquired by a private investment group from 2000 to 2006, even as citations declined at many other homes and chains.

The typical number of serious health deficiencies cited by regulators last year was almost 19 percent higher at homes owned by large investment companies than the national average, according to analysis of Centers for Medicare and Medicaid Services records.

In the case of Habana Health Center,

Habana’s managers increased occupancy, and cut expenses by laying off about 10 of 30 clinical administrators and nurses, Medicare filings reveal. (After regulators complained, some positions were refilled and other spending increased.) Soon, Medicare regulators cited Habana for malfunctioning fire doors and moldy air vents.

'Those owners wouldn’t let us hire people,' said Annie Thornton, who became interim director of nursing around the time Habana was acquired, and who left about a year later. 'We told the higher-ups we needed more staffing, but they said we should make do.'

Regulators typically visit nursing homes about once a year. But in the 12 months after Formation’s acquisition of Habana, they visited an average of once a month, often in response to residents’ complaints. The home was cited for failing to follow doctors’ orders, cutting staff below legal minimums, blocking emergency exits, storing food in unhygienic areas and other health violations.

Soon after, nursing home inspectors wrote in Centers for Medicare and Medicaid Services documents that Habana was at fault when a resident suffocated because his tracheotomy tube became clogged. Although he had complained of shortness of breath, there were no records showing that staff had checked on him for almost two days.

Five months later, Mrs. Hewitt discovered that her mother had a large bedsore on her back that was oozing pus. Mrs. Garcia was rushed to the hospital. A physician later said the wound should have been detected much earlier, according to medical records submitted as part of a lawsuit Mrs. Hewitt filed in a Florida Circuit Court.

Three weeks later, Mrs. Garcia died.

Complex, Opaque Corporate Structures

Particularly fascinating and disturbing was the evidence that the nursing homes' managers evaded regulation, and legal responsibility for what they were doing by creating immensely complicated and opaque corporate structures.

Private investment companies have made it very difficult for plaintiffs to succeed in court and for regulators to levy chainwide fines by creating complex corporate structures that obscure who controls their nursing homes.

By contrast, publicly owned nursing home chains are essentially required to disclose who controls their facilities in securities filings and other regulatory documents.

The Byzantine structures established at homes owned by private investment firms also make it harder for regulators to know if one company is responsible for multiple centers. And the structures help managers bypass rules that require them to report when they, in effect, pay themselves from programs like Medicare and Medicaid.

For example,

Formation bought Habana, 48 other nursing homes and four assisted living centers from Beverly Enterprises, one of the nation’s largest chains, for $165 million.

Formation immediately leased many of the homes, including Habana, to an affiliate of Warburg Pincus. That firm spread management of the homes among dozens of other corporations, according to documents filed with Florida agencies and depositions from lawsuits.

Each home was operated by a separate company. Other companies helped choose staff, keep the books and negotiate for equipment and supplies. Some companies had no employees or offices, which let executives file regulatory documents without revealing their other corporate affiliations.

Current staff members at Habana declined to comment. Formation Properties I said it owned only Habana’s real estate and leased it to an independent company, and thus bore no responsibility for resident care.

That independent company — Florida Health Care Properties, which eventually became Epsilon Health Care Properties and subleased the home’s operation to Tampa Health Care Associates — is affiliated with Warburg Pincus, one of the world’s largest private equity firms. Warburg Pincus, Florida Health Care, Epsilon and Tampa Health Care all declined to comment.

The example of Habana Health Center showed how the complex and opaque corporate structures thwarted regulators.

Those [government] citations never mentioned Formation, Warburg Pincus or its affiliates. Warburg Pincus and its affiliates declined to discuss the citations. Formation said it was merely a landlord.

'Formation Properties owns real estate and leases it to an unaffiliated third party that obtains a license to operate it as a health care facility,' Formation said. 'No citation would mention Formation Properties since it has no involvement or control over the operations at the facility or any entity that is involved in such operations.'

Florida’s Agency for Health Care Administration has named Habana and 34 other homes owned by Formation and operated by affiliates of Warburg Pincus as among the state’s worst in categories like 'nutrition and hydration,' 'restraints and abuse' and 'quality of care.' Those homes have been individually cited for violations of safety codes, but there have been no chainwide investigations or fines, because regulators were unaware that all the facilities were owned and operated by a common group, said Molly McKinstry, bureau chief for long-term-care services at Florida’s Agency for Health Care Administration.

And even when regulators do issue fines to investor-owned homes, they have found penalties difficult to collect.

'These companies leave the nursing home licensee with no assets, and so there is nothing to take,' said Scott Johnson, special assistant attorney general of Mississippi.

Complex corporate structures also enable nursing home management to evade scrutiny of what they charge.

Government programs require nursing homes to reveal when they pay affiliates so that such disbursements can be scrutinized to make sure they are not artificially inflated.

'The government tries to make sure homes are paying a fair market value for things like rent and consulting and supplies,' said John Villegas-Grubbs, a Medicaid expert who has developed payment systems for several states. 'But when home owners pay themselves without revealing it, they can pad their bills. It’s not feasible to expect regulators to catch that unless they have transparency on ownership structures.'

In the case of Habana Health Center,

For example, Habana, operated by a Warburg Pincus affiliate, paid other Warburg Pincus affiliates an estimated $558,000 for management advice and other services last year, according to reports the home filed.

However, complex corporate structures make such scrutiny difficult. Regulators did not know that so many of Habana’s payments went to companies affiliated with Warburg Pincus.

Summary

We see some very familiar themes in this sorry tale.

Health care is increasingly dominated by large organizations. In this case, some of these organizations are not usually identified with health care, and the identity of other organizations is secret.

The leadership of many health care organizations will put their financial self-interest ahead of patients' interests.

The leadership of many health care organizations will hide what they are doing, evade responsibility, and thwart accountability by deliberate complexity and outright deception.

Until the leadership of health care organizations becomes more transparent and accountable, things are likely to continue to go downhill.

Once again, "sunlight is the best disinfectant."

The tgAAC94 Study Consent Form: Raising More Questions than it Answered

We previously posted, most recently here, about the unfortunate case of a young woman who died after participation in a Phase I safety study of a gene-therapy agent for inflammatory arthritis, tgAAC94, made by Targeted Genetics.

An astute comment on our last post directed me to the actual consent form for this study, available here, courtesy of Citizens for Responsible Care and Research. Review of the form, coupled with what is already available from the media about this case, (see discussion in previous post and links backward), raised even more questions about this benighted human experiment. These included questions about what was in the form, and what the form left out.

Did the Consent Form Exaggerate the Safety of the Treatment?

The consent form included various statements that seemingly were meant to persuade study subjects that the treatment was safe, even though the treatment's safety was unknown, and the ostensible purpose of the study was to test its safety.

First, it included statements in the "Study Agent" section that seemed to suggest that the adeno-associated virus (AAV) which would transfer the gene was innocuous:

AAV infects many people in everyday life, but does not cause disease in humans. Although tgAAC94 was modified from AAV, tgAAC94 cannot grow in your body because all the AAV genes, including those that it needs to grow, have been removed.

Then, the "Risks, Hazards, and Discomforts" section seems to contain multiple arguments why the treatment may be safe, which took more space than discussion of its possible hazards.

It noted that the AAV vector (without the gene for etanercept) could produce an "immune response," but this causes "no side effects" in previous studies.

Targeted Genetics Corporation has used AAV to introduce genes into 200 people. These included about 140 subjects with a genetic disorder called cystic fibrosis (CF) who received does of a similar AAV vector into the nose, maxillary sinus, and lung, and about 65 healthy volunteers who received an injection of a similar vector into the muscle in an HIV vaccine study. Some subjects administered the highest doses developed an immune response. This immune response consisted of elevated proteins that interact with AAV in the blood. No side effects related to the development of this immune response have been noted so far.

Later, it tried to minimize the relevance of reports that high doses of AAV could cause cancer in animals.

The U.S. Food and Drug Administration (FDA), which oversees clinical studies of investigational drugs in the United States, was made aware of an animal study where [sic] a number of newborn diseased mice injected with very high doses of an AAV vector developed liver tumors. This was a research study using an AAV vector that was not designed or produced for human use. The vector used for the mouse study did not contain the TNFR-Fc gene and it was not designed to treat inflammatory arthritis. Tumors have not been observed in other similar studies of different types of mice injected with higher doses of AAV vectors and watched for over a year. There have been no reports of tumors in the limited number of human subjects who have received an AAV vector. Tumors have not been reported in any other animal studies of AAV vectors, but the number of studies that have been done so far is small. It seems unlikely that the tumors are linked to the AAV vector, but we do not know for sure.

It reported that injection of tgAAC94 appeared safe in animal studies:

A single dose of tgAAC94 has been injected into the joints of both rats and monkeys without raising any safety concerns. A single dose of a different AAV vector, containing the rat version of TNFR-Fc, has also been injected into the joints of rats with arthritis without causing any problems.

It noted that tgAAC94 had been given to small numbers of people without ill effects.

A single injection of tgAAC94 has been given to the joint [sic] of approximately 10 humans in another study of tgAAC94 without raising any safety concerns.

It noted that repeat injections of tgAAC94 given to animals only produced mild side-effects.

Repeat injections of tgAAC94 into joint have been given to rats once a month for three months. After the second injection of tgAAC94, approximately 20% of the rats developed mild swelling to the joint [sic] that resolved after a few days.

Only at the very end were there these two sentences.

There may be other not-yet-identified side effects that could occur during the time you participate in the study or years after receiving the study agent. Unknown side effects could be mild, serious, or life-treateneing, and could result in pain, discomfort, disability, or, in rare circumstances, death.

Thus, much of the ostensible discussion of possible adverse effects of the treatment consisted of arguments that the treatment was safe, again, made before any safety data had been collected. This seems particularly inappropriate for a study designed to assess the safety of treatment.

Did the Consent Form Imply that Patients Would Benefit from Study Participation?

The study was ostensibly only meant to test the treatment's safety, not its benefits. Whether the treatment has any benefits for humans has never been assessed.

However, the "Study Agent" Section included,

By injecting tgAAC94 directly into an affected joint in your body (called the target joint), we hope it will help the body make a protein that stops the inflammatory process and reduces the progressive joint destruction and resulting disabilities associated with inflammatory arthritis.

Furthermore, in the "Risks, Hazards, and Discomforts" section are statements that, rather than relating to the agent's possible risks, seem to draw parallels that argue for its effectiveness.

The gene that is transferred to the body codes for a protein that is the same as the approved medication called etanercept or Enbrel. Etanercept has been given by an injection under the skin to many people with inflammatory arthritis with remarkable improvement in their symptoms.

It also included a statement about use of a gene transfer therapy for rats,

The arthritis in these rats seemed to improve.

Thus, the consent form clearly contained arguments that the treatment could be beneficial, even though its benefits had never been assessed. Furthermore, some of these arguments were interspersed through a section of the consent form that was supposed to discuss possible adverse effects of the treatment, possibly distracting the reader.

Could A Research Subject Understand the Form?

The form contained numerous scientific terms and used technical jargon. It is not obvious that participants who were not familiar with biology or medicine could understand most of it.

The form also raised questions about what it did not include.

Who Actually Designed and Implemented the Study?

The form did identify the study's sponsor, i.e., the organization that paid for the study to be done, as Targeted Genetics Corporation.

The version of the form available on the CIRC web-site listed the study investigator as Robert G Trapp MD, with an address in Springfield, Illinois, and gave a 24 hour phone number for him. It identified the study site as the Arthritis Center, at the same address. Dr Trapp appeared to be one of the physicians enrolling patients, and the Arthritis Center appeared to be the name of his practice location. The form did not identify Dr Trapp as the Principal Investigator, i.e., the person in charge of the whole study. Apparently, his role would be that of "research doctor," a term used frequently later in the form. It is possible that different versions of the form used at other sites identified other "investigators."

However, the form was silent about who was in charge of the study, who designed the study, or who would implement the study. In general, clinical research studies have a Principal Investigator, or perhaps two Co-Principal Investigators, who take responsibility for the design, scientific conduct, analysis, and dissemination of the study. Furthermore, clinical research studies are generally carried out by study teams, or could be based at a medical school, research institute, teaching hospital, or contract research organization (CRO).

The form, in fact, did not identify anyone as the Principal Investigator, or anyone other than Dr Trapp as being involved with the study. It did not explain who had designed the study. It did not mention who would carry out the study, for example, by collecting data, ensuring that patients had appropriate follow-up, entering data, analyzing data, writing up results, etc.

The form did identify the Institutional Review Board (IRB) which reviewed the study and the consent form itself as the Western Institutional Review Board (WIRB), stating "WIRB is a group of people who perform independent review of research." This statement seems disingenuous, since WIRB is also a profit-making company (see Emanuel EJ, Lemmens T, Elliott C. Should society allow research ethics board to be run as for-profit enterprises. PLoS Med. 2006 July; 3(7): e309. DOI:10.1371/journal.pmed.0030309).

Thus, although the form identified the "investigator" who would be the study subject's first point of contact with the study, it failed to identify all the other people who were doubtless involved in designing, and carrying out the study, and failed to identify anybody who had ultimate authority for the design and implementation of the study.

Summary

It seems the more we learn about this case, the less we realize we know. There have been questions all along about the appropriateness of the consent form and how it was presented to potential study subjects: whether it de-emphasized possible risks, hinted at benefits that may not exist, and was written and administered in a way that was not conducive to somber consideration by potential research subjects.

Now, it seems that the identities of the people who actually designed, controlled, and implemented this study are mysterious as well. I do not understand how experimental research can be done on humans without telling the research subjects who is actually responsible for the experimentation to be done on them. Furthermore, these identities remain mysterious even after a well-publicized NIH hearing on the fatal outcome of this study. I also do not understand how an official government hearing on this project did not involve, nor reveal, who these people were.

Perhaps some investigative reporting will solve some of these mysteries.

Meanwhile, this troubling and now too mysterious case should cause patients, physicians, and policy makers alike to re-consider whether we should continue to allow experimental testing of drugs or devices on humans to be done by those with vested interests in the success of the drugs or devices being tested.

BLOGSCAN - "Lawyerly Parsing" the Manufacturing Outsourcing Story

On PharmaLot, Ed Silverman follows up on the story that AstraZeneca plans to outsource its pharmaceutical production, mainly to India and China. (See previous post here.) Apparently, the publicity garnered by the first version of the story put the company into a bit of a tizzy. Silverman concluded first, " the AZ effort to disavow Smith’s remarks appears disingenous and resembles the worst kind of lawyerly parsing." His final conclusion would seem familiar to Health Care Renewal readers, "If AZ wants public trust in its products, the drugmaker must also instill trust in its words."

Which Frogs A-Leaping?

Reported so far mainly in medical news outlets, e.g., in WebMD health news, was a survey from the Leapfrog Group naming the US best hospitals. There has also been some local coverage in areas in which some of the named hospitals are based, e.g., here in the Star-Telegram.

The Leapfrog Group proclaims itself to be "a voluntary program aimed at mobilizing employer purchasing power to alert America’s health industry that big leaps in health care safety, quality and customer value will be recognized and rewarded." It is usually described as a group of large employers out to improve health care.

Is that description accurate? Who are its members.? The most recent list is here.

On it are some well known large companies, such as Boeing and IBM. But what is most striking about its membership is the prevalence of health care corporations. A full 14 of 49 members (28.6%) are health care corporations. These include pharmaceutical companies, e.g.,

• Boehringer Ingelheim,
• Eli Lilly and
• Sanofi-Aventis.

These also include health care insurers and managed care organizations, e.g.,

• Aetna Inc,
• Blue Shield of California,
• HCA,
• UnitedHealth, and
• Wellpoint.

These include hospitals and hospital networks, e.g.,

• Greenville Hospital System, and
• Heartland Surgical Specialty Hospital.

And these include other health care companies, e.g.

• Milliman (purveyors of care guidelines), and
• Thomson Healthcare (providers of health care information resources).

The members also include companies who, while not being purely in health care, have significant health care businesses, such as General Electric.

One would expect that companies who make money by providing health care goods and services may have different ideas about health care costs and quality than companies who do not do any health care related business.

So it seems that it is the truth that the Leapfrog Group is an organization of employers, it is not the whole relevant truth. In fact, it appears that the Group includes significant representation of companies who have vested interests in health care being done in certain ways. Thus, its ideas about how to improve quality and lower costs may have been influenced by the vested interests of its members, which may not represent just the interests of employers who provide health insurance to their employees. At least, the organization should make clear that it includes "employers" who also sell drugs, sell health insurance, manage care, and market health care information.

This seems like another example, in a somewhat different dimension, of conflicts of interest in health care, and of the failure of such conflicts to be clearly disclosed. This also seems like another demonstration that things are rarely what they seem in the complex and not always honest world of health care, particularly in the US.

In my humble opinion, full disclosure of all relevant conflicts in all dimensions, and consideration of whether certain kinds of conflicts should be not merely disclosed, but reduced or eliminated, might go a long way to improving our problems with health care costs, quality, and access.

"Sunlight is the best disinfectant."

Note, see our previous post here about a previous version of Leapfrog Group membership.

ADDENDUM (19 September, 2007) - On the Running a Hospital Blog, Paul Levy posted a bit more positively about Leapfrog, although he finished somewhat ambiguously by wondering whether the group has "lost importance" by hopping "over their own approach."

The WSJ Health Blog provided more detail about the LeapFrog hospital quality report here.

An NIH Hearing About the Death of a Patient in a Gene Therapy Trial

We previously discussed, most recently here, the unfortunate and unexplained death of young patient after an injection of an experimental gene-therapy agent. A US National Institutes of Health (NIH) committee, the Recombinant DNA Advisory Committee, just conducted a hearing about the case, which received considerable media coverage. The coverage did illuminate a few more important details, although much about the case remains mysterious.

To summarize the case thus far, a young woman received a dose of an adeno-associated virus carrying a gene that was meant to have a local immune suppression effect, tgAAC94, made by Targeted Genetics, directly into her joint as part of a phase I study meant to assess the safety of the treatment. Soon after the treatment, she became ill, then very ill, and ultimately died in an intensive care unit. Whether the treatment had anything to do with her illness and death were initially unclear. Questions were raised about the conduct of the trial, including

• whether the patient was lead to believe she might benefit from it, even though the study was meant only as an initial, Phase I, safety assessment;
• whether she was influenced to participate because her rheumatologist was an investigator, and he administered the informed consent form, without disclosing he was paid to participate in the trial;
• whether she found the consent form understandable;
• what institutional review board (IRB) reviewed the trial; and
• whether Targeted Genetics unduly delayed reporting the patient's condition to the US Food and Drug Administration (FDA)?

The key points from the hearing, as reported by the New York Times and Washington Post, were:

• The patient died apparently from a massive histoplasmosis (fungal) infection, possibly complicated by major internal bleeding
• The patient was also taking "Humira, a drug similar to Enbrel that has also been linked to infections, including histoplasmosis. She was also on two other immune-suppressing drugs." [Times]
• The genetically engineered AAV had spread to her liver and spleen, although the President of Targeted Genetics said the the levels of the virus were "tiny"
• The patient did not appear disabled or seriously ill from arthritis before entering the trial, her "husband, Rob, told the panel that his wife was only mildly affected by her arthritis and was not properly warned of the experiment's risks." [Post]
• The panel was concerned "about the way his wife was signed up for the study. They noted that, although no regulation prohibits the practice, it can be ethically problematic when a patient's personal physician recruits the patient.... Patients routinely overestimate the chance that an experimental treatment will help them, and this 'therapeutic misconception' is even more likely when the recruiter is the patient's personal doctor...." Also, her "physician also signed her up immediately, rather than having her take the materials home to consider.... And there was no mention in the informed consent document that her doctor was being paid by Targeted Genetics for every patient he enlisted." [Post]

In my humble opinion, the main achievement of this meeting was affording a potentially important case more publicity. To me, the major questions remain: what relationship, if any, was there between the experimental therapy and the patient's illness and death; would changes in the conduct of experiments like this, particularly involving informed consent, lower the probability of future tragedies?

The larger question is whether companies and other organizations should be sponsoring and controlling research on human beings when the companies and organizations have financial (or ideological) stakes in the outcome of the studies?

Targeted Genetics employees seemed to be taking a persistently optimistic view about the role of their treatment in this case. Note the comments above of the President minimizing the importance of admittedly preliminary data showing that the AAV had spread beyond the joint into which it was injected. Furthermore, in a Seattle Times report, a company spokesperson also asserted that the virus was "unlikely" to have been related to the patient's death, and that the data so far was "very positive." Of course, when one's job and company's financial future depend on a particular interpretation of the science, one is likely to support that interpretation.

ADDENDUM (20 September, 2007) - The consent form for this study is apparently available on the web here. See first comment below. It appears to raise more questions than it answers. Stay tuned.

Caught in the Cross-Fire: Patients, Doctors, DaVita, Amgen, and Medicare

The New York Times just published a report that raised intriguing questions about the biggest US commercial dialysis provider, and, its relationships with a large biotechnology company on one hand, and the US government's Medicare system, on the the other. These questions thus end up being about how the power of big business and big government intersect within US health care.

First, here is some background. In the US, nearly all dialysis for patients with end-stage renal disease (ESRD) is funded by Medicare, the government single-payer insurance system for the elderly and disabled. Yet nearly all such patients get their dialysis in commercially run clinics. We recently posted about allegations of anti-competitive practices by some of the companies that run such clinics.

The NY Times focused on another company, DaVita, "a leading provider of dialysis services."

1 - Who is really responsible for key clinical decisions made on behalf of dialysis patients in commercially run clinics?

This will require more background. Epogen (epoetin , manufactured by Amgen), combats the anemia that often afflicts dialysis patients. There has been recent controversy about whether physicians use the drug too aggressively, raising expenses, and possibly doing patients no good, and even harm. Moreover, Medicare pays for Epogen separately from other dialysis services, and allows clinics that administer it to mark up the price, making it a lucrative source of revenue. (See our related posts here, here and here.)

DaVita patients apparently receive a lot of Epogen.

How DaVita makes much of its money: by administering the drug Epogen to treat anemia in dialysis patients. DaVita receives more from Medicare and private insurers for providing Epogen than it pays to buy the drug from its manufacturer, Amgen.

DaVita treats about 106,000 patients in more than 1,300 clinics and appears to be the most aggressive Epogen user among major dialysis chains, according to the United States Renal Data System, a government-funded registry of dialysis data. Epogen accounts for 25 percent of DaVita’s revenue and up to 40 percent of its earnings, according to the Stanford Group Company, a research firm.

In the article, Kent J Thiry, DaVita's CEO, appeared to assume responsibility for the use of all this Epogen. Thiry took "issue with what he describes as unfair accusations that his company’s profits are built on a product that causes harm to patients." He then said "he would welcome a well-designed change in the reimbursement system to eliminate perceived incentives to overuse Epogen, which is commonly referred to as Epo. 'Do that tomorrow so we get rid of the taint,' he said. 'We’re still going to use the same amount of Epo.'

But how did Mr Thiry, described as a graduate of "Harvard Business School, ... [who] was a consultant at Bain & Company and then ran Vivra, a dialysis chain in Northern California," become so confident about the reasons DaVita patients get so much Epogen? He is not a doctor. He said "DaVita did not overuse Epogen. He said decisions on how much to use are made by patients’ physicians."

Then how could he be sure how these physicians would prescribe in the future?

Maybe it is because "DaVita does have a central protocol to advise doctors on dosage."

So just how much direct control DaVita physicians have over their own prescribing, versus how much they must toe the company line is unclear.

2 - Are prescribing decisions affected by conflicts of interest?

Dialysis clinics lose money on the fee paid by Medicare for a dialysis treatment because the payments haven’t kept pace with inflation. Yet industry executives say the clinics can typically recoup those losses by getting reimbursed for Epogen and other drugs.

Government officials “understood they were subsidizing the cost of dialysis by allowing us to make a profit on the drugs,” said Dr. J. Michael Lazarus, chief medical officer of Fresenius [another commercial dialysis provider].

Amgen offers discounts and rebates to dialysis companies based, in part, on how much Epogen they use and how much that use increases year to year. DaVita says in regulatory filings that failure to qualify for such discounts could have a 'material adverse effect' on the company’s earnings.

Mr. Thiry declined to comment about Amgen. But in previous comments to reporters and analysts, he has accused Amgen of 'abuse of monopoly power' and has said that Washington would not care as much about Epogen if the price were lower.

In a letter to Amgen in February 2006, DaVita protested terms of a new contract, saying it would face huge financial penalties if it didn’t increase usage of Epogen by 4 percent.

What sense did the contract with Amgen make if DaVita has no control over the amount of Epogen its physicians prescribe? But did the structure of contracts between DaVita and Amgen put pressure on the company to in turn pressure its physicians to prescribe more Epogen? Did this amount to a conflict of interest? Did DaVita patients know that the company's profits were tied to how aggressively their physicians prescribed?

The NY Times has provided a disturbing look into how corporate motives intrude into the patient-physician relationship, and how this intrusion was apparently facilitated by how the US government's single payer health insurance system, Medicare, works. The end results seems to be patients and physicians caught in the cross-fire between a commercial dialysis provider, a biotechnology company, and the US government.

"Yee Hah" Direct to Consumer Advertising

An editorialist at The Day (New London, CT) had some choice comments about the current direct to consumer (DCT) advertising of Viagra (sildenafil), the erectile dysfunction (ED) drug made by Pfizer Inc.

Pfizer Inc. denies it, but it sure appears it no longer markets Viagra as simply medicine, but encourages recreational use by projecting an aphrodisiac-like image.

In 2005 Pfizer and other pharmaceutical companies peddling male impotence drugs toned down their advertising after the Food and Drug Administration criticized sexually-suggestive commercials that paid little attention to the medical problem the drugs are intended to address — erectile dysfunction (ED).

Pfizer, which had run TV advertisements of men growing blue devilish horns when the Viagra logo appeared, turned in late 2005 to conservative spots....

But the conservative strategy apparently produced impotent sales because Pfizer is back to using a 'yee-hah' approach to selling the little blue pill. New spots feature the catchy tune 'Viva Viagra,' sung in one commercial by a group of guitar-picking manly men who apparently share a desire not to disappoint their partners.
n another commercial a distinguished man twirls his date around the dance floor to the tune, before heading up the elevator with her for you know what. These advertisements frequently pop up when family members are watching a sporting event or movie. Talk about intrusive.

Last Christmas season a Viagra commercial aired during the reindeer movie
'Prancer.' A commercial for competitor Cialis appeared on an early-evening presentation of 'Miracle on 34th Street.' Happy holidays.

Dr. Brian Klee, senior medical director on the Pfizer Viagra global medical team, said the company has taken new steps to target the commercials for predominately adult audiences and avoid broadcasting them around religious and family holidays. He also said the marketing strategy is not intended to encourage men who don't really need the drug to give it a try, but instead to persuade men who do need it to work up the courage to ask their doctor about it.

Visit www.viagra.com/content on the web and you can see the 'real' Viva Viagra group singing.

Men visiting the site can then take a little quiz that basically leads to the conclusion that unless you're batting 1.000 in bed, you're a candidate for Viagra.

Apologies to Dr. Klee, but it appears clear the intent is to broaden the customer base for Viagra beyond men who are having real problems.

It is not spending that money because ED is a great medical scourge. It spends it to make money. Viagra sales totaled $836,436,000 for the company in 2007. It cannot achieve those kinds of sales figures without a lot of men asking for the blue pill, some who don't really need it. And with Pfizer profits falling 48 percent in the second quarter of this year, it needs sales.

Maybe there is nothing wrong with pushing Viagra this way. The drug has proved safe. It is the speciousness of Pfizer's approach that is maddening.

Having seen more than my fair share of Viagra (and Cialis) advertisements, often during nightly news programming, I share the editorialist's opinion that they are mainly about sex, not about erectile dysfunction.

Again, if pharmaceutical companies (and other health care organizations) were more honest about what they are doing, maybe they would no longer be regarded as "shifty."

BLOGSCAN - More on Prescription Data Mining

On the Carlat Psychiatry Blog, this post reviews how "pharmacy information companies" get data about which physicians prescribed what drugs from pharmacies, combine it with data on physicians from the American Medical Association (AMA), and package the result, which identifies how many prescriptions each doctor wrote for each drug, to pharmaceutical companies. The post features some delightful sarcasm on how the "pharmacy information companies" defend their lucrative work, as increasing "transparency."

BLOGSCAN - Pharmaceutical Manufacturer to Outsource Manufacturing

On PharmaGossip, this post, and on PharmaLot, this post are about AstraZeneca's avowed intention of getting out of the drug manufacturing business. Apparently, the company is planning to outsource all its manufacturing, mainly to factories in China and India. So I guess we soon won't be able to call Astra Zeneca a pharmaceutical manufacturer? The PharmaLot post noted "the pharmaceutical sector is among the most conservative global industries in its attitude towards manufacturing and the supply chain, in part because of a history of high profit margins and stringent industry regulation." And didn't we just hear something about toys whose manufacturing was outsourced to China covered with lead-based paint, and pet food containing toxic chemicals whose manufacturing was outsourced to China? Maybe that regulation had a purpose?

BLOGSCAN - More Criticism of Study Linking Rising Youth Suicide and "Black Box" Warnings for SSRIs

On the Clinical Psychology and Psychiatry blog, this post dissects that study which purported to link the decreasing use of selective serotonin reuptake inhibitor (SSRI) anti-depressants, after the US Food and Drug Administration (FDA) mandated a "black box" warning for these drugs, circa 2004, with increasing youth suicide rates (in 2004). It turns out that the study's methods appear rather weak. Questions had already been raised about the study (see earlier post on Clinical Psychology and Psychiatry) , which was also not corroborated by reports that the suicide rate declined again in 2005 (see another earlier post). We previously noted Merrill Goozner's critical take on the same study in GoozNews, in which he also alluded to the conflict of interest of the study's author that was widely ignored in its previous media coverage.

Genzyme Settles One

The Boston Globe just reported about some questionable tactics the biotechnology firm Genzyme used in the course of a merger and subsequent stock buy-back. Here is the background,

Like many large biotech firms, Genzyme has built its success as much by acquiring businesses and clever financing as by developing new drugs. The biosurgery division was a typical Genzyme creation.

The company set up Genzyme Biosurgery in December 2000 when it bought Biomatrix Inc., a New Jersey company. The attraction was Synvisc, a promising material that could be injected into arthritic knees to ease pain. Genzyme used tracking shares in the new division to pay for most of the transaction, worth about $860 million....

At the outset, the appeal for shareholders of Genzyme Biosurgery was that Synvisc and the division's other products had enormous growth potential that would allow the stock to rise faster than shares of Genzyme. Aside from the normal risks of owning stock, there was an additional one: Genzyme could at any time buy the tracking shares and absorb the division into the parent. The price was supposed to reflect the division's fair market value, but Genzyme had the right to choose the timing for the purchase.

Within six months of the acquisition, Genzyme soured on the arrangement. Company officials asked their investment bankers how to eliminate Biosurgery stock. A Feb. 27, 2002, Genzyme report on Project Eleanor described a timeline for buying the shares the following year.

'We are working towards reabsorbing' Genzyme Biosurgery, Peter Wirth, Genzyme's top lawyer, told Termeer in March 2002, an outline of the meeting said.

That August, Genzyme executives held a dinner discussion about the tracking stocks entitled 'Where Do We Go From Here?' The conclusion, according to company briefing materials, was that the biosurgery tracking stock had been a flop.

The issue was when to buy back the tracking stock. This is where things get complex.

But how quickly? The corporate charter said the parent firm could buy the tracking stock at any time, using cash or its own stock. The price would be the average of Genzyme Biosurgery's closing price over 20 trading days, plus a 30 percent premium. Genzyme preferred to use its stock rather than cash. But its stock had dropped by two-thirds between January and June of 2002 because of poor sales of the company's dialysis drug, Renagel. That meant Genzyme would have to use more of its own shares, making the deal more expensive.

Internally, Genzyme expected sales to improve, and its stock to bounce back. The company decided to wait, keeping Genzyme Biosurgery intact until that happened.

When the board met Oct. 3, 2002, directors discussed in detail eliminating Genzyme Biosurgery. Based on a company estimate, the division could be "rolled up" for only 60 percent of what Genzyme actually thought Biosurgery was worth. Shareholders would get $3.55 a share. Directors also discussed steps to protect themselves from lawsuits that might result from the buyback.

But Genzyme did not act immediately. Instead, according to shareholders' allegations, Genzyme tried to drive down the price of Biosurgery shares, to make the acquisition even cheaper.

In a lawsuit filed later, share-holders alleged that Genzyme used a variety of tactics to drive down the price of the tracking shares before the buy-back.

For instance, Genzyme disclosed bad news about the Biosurgery division while withholding good news.

In early 2003, Genzyme made public that the US distributor of Synvisc was lowering inventory levels - a sign of poor sales. The result was that Genzyme Biosurgery shares dropped to a record low, $1.17 a share. But according to the complaint, Genzyme had known about the inventory reduction since 2001.

Quinn, Genzyme's spokesman, said the company knew the distributor, Wyeth, was trying to reduce its inventory prior to the disclosure. 'We were trying to delay [the inventory reduction] for as long as possible and hoped we could avoid it entirely, particularly if sales rose to a point where it wouldn't be necessary,' he said. 'Ultimately, it was Wyeth's decision.'

Shareholders alleged that Genzyme also withheld information about a business within the biosurgery division that makes cardiothoracic surgical instruments. The division tried to sell the money-losing unit but the deal fell through in the summer 2002. In December 2002, Genzyme restarted the sales process, hiring J.P. Morgan Securities Inc. to identify prospective buyers. By March 2003, J.P. Morgan was guiding a group of prospective buyers through final steps prior to soliciting formal offers.

Genzyme kept secret its renewed effort to sell the instrument business. That news, shareholders claim, could have sent Genzyme Biosurgery shares up sharply, because the division would have immediately become profitable upon sale of the division. But Termeer did not tell shareholders until the May 8 conference call. It was too late: The price for the share buyback had already been set.

Genzyme also kept secret news that the Food and Drug Administration had given Biosurgery approval to conduct clinical trials on Synvisc's use in hip joints.

Quinn said Genzyme made 'all appropriate disclosures' regarding both developments. In particular, he said, the company's policy is not to disclose clinical trials until physicians begin giving doses to patients. That policy also applied to the Biosurgery division, he said, even though the start of the hip trial potentially might have had a major impact on prospects for the division.

Genzyme also commissioned an outside appraisal of the value of the tracking shares, but share-holders alleged that it was not accurate.

At a Feb. 27, 2003, meeting, Genzyme directors took a final look at the mechanics of the Biosurgery buyback. Once again, directors examined ways to minimize their legal exposure. They called for an outside valuation on the exchange price - known as a fairness opinion - to provide 'additional comfort' in the event of legal action disputing the deal.

The outside firm, Houlihan Lokey Howard & Zukin Capital, concluded that Biosurgery shares were worth $1.31 to $2.54. The purchase price of $1.77 was comfortably in that range. In court papers, shareholders characterized the report as a 'sham' that used arbitrary methodology to arrive at a predetermined price and provide cover for Genzyme's bargain price.

Genzyme disputed the share-holders' allegations, but just agreed to settle the case for $64 million. Documents released after that settlement formed the basis for the Globe's report.

In legal filings, Genzyme disputes the shareholders' interpretation of the events leading up to the buyback.

Last month, days before the case was to go to trial in New York City, Genzyme agreed to pay $64 million to settle the case.

Executives of pharmaceutical and biotechnology companies wonder why the public often does not trust their companies. (See posts here and here. )

A seemingly endless series of legal cases in which the companies end up settling allegations that they pushed the envelope of the truth to make more money may contribute to the public's impression that these companies' leadership often puts making money ahead ot being truthful.

If one cannot trust many of these companies' financial dealings, why should one believe what they say about their products, and why should one believe the research they sponsor, and their "educational" programs for doctors?