Abbott Laboratories and Pig Roasts, the "Philly Mob," and Legal Settlements

Help.... The health care muck is now being raked so fast I can't keep up.

Abbott Laboratories, Prolific Stenters, Pig Barbecues, Etc

In the last week, multiple media outlets picked up the story of the cozy relationship between Abbott Laboratories and a doctor now accused of implanting too many cardiac stents for too much money.  The essentials were, as summarized from New York Times, Wall Street Journal, and Baltimore Sun articles -

Dr Mark Midei was a prolific user of cardiac stents for patient with coronary artery disease (blocked cardiac arteries)

In the June deposition, Dr. Midei estimated that in 2005 — before research revealed that many stents were unnecessary — he performed about 800 stent procedures. Instead of dropping in subsequent years, however, the number of stents Dr. Midei inserted rose to as many as 1,200 annually, he estimated. In a 2007 internal document, Abbott Laboratories ranked Dr. Midei’s use of stents behind only five other cardiologists in the Northeast, including those at hospitals four and five times St. Joseph’s size. [NYT]

Therefore, hospitals sought him out

He had been one of the most sought-after clinicians in his region. Trained at Johns Hopkins University, he was a co-founder of MidAtlantic, a practice with dozens of cardiologists that controlled much of the cardiac business in Baltimore’s private hospitals. Dr. Midei was one of the practice’s stars. When MidAtlantic negotiated a $25 million merger with Union Hospital in 2007, the deal was contingent on his continued employment.

St. Joseph was so concerned about losing Dr. Midei’s business that the hospital offered a $1.2 million salary if he would leave MidAtlantic and join the hospital’s staff. [NYT]

However, it appeared he performed the procedures on patients who would not benefit from them.

The hospital engaged a panel of experts who reviewed 1,878 cases from January 2007 to May 2009 and found that 585 patients might have received unnecessary stents.

When asked to review the cases himself, Dr. Midei found far less blockage than he had initially, according to the Maryland Board of Physicians. The hospital suspended his privileges and eventually sent letters to all 585 patients. Hundreds of lawsuits against Dr. Midei and St. Joseph followed, including from patients treated well before January 2007. [NYT]

Nonetheless, Abbott Laboratories had been rewarding him for frequent use of their products

Word quickly reached top executives at Abbott Laboratories that a Baltimore cardiologist, Dr. Mark Midei, had inserted 30 of the company’s cardiac stents in a single day in August 2008, 'which is the biggest day I remember hearing about,' an executive wrote in a celebratory e-mail.

Two days later, an Abbott sales representative spent $2,159 to buy a whole, slow-smoked pig, peach cobbler and other fixings for a barbecue dinner at Dr. Midei’s home, according to a report being released Monday by the Senate. The dinner was just a small part of the millions in salary and perks showered on Dr. Midei for putting more stents in more patients than almost any other cardiologist in Baltimore. [NYT]

When his over-use was alleged, Abbott continued to use him as a key opinion leader.

Abbott responded to the controversy by hiring Dr. Midei as a consultant. 'It’s the right thing to do because he helped us so many times over the years,' an Abbott executive wrote in a January e-mail cited in the Senate report. [NYT]

Also,

After St. Joseph barred Dr. Midei from practicing there in May 2009, Abbott arranged consultant work for him, according to emails released by the Senate committee.

In December 2009, an Abbott senior vice president wrote in an email that he was 'very open' to having Dr. Midei do consulting 'to see how it might go—either getting the word out in China/Japan, medical or safety work.'

The following month, the Sun reported on the allegations against Dr. Midei and St. Joseph. According to the Senate report, an Abbott executive subsequently said in an internal company email, 'We recommend that we not use Dr. Midei in the U.S. at this time (the press is just too hot).'

Charles Simonton, the medical director of Abbott's vascular division, said in another email cited by the report that Dr. Midei should 'clearly avoid' the Baltimore area, but Dr. Simonton encouraged colleagues to 'please find key physicians or cath labs you'd like him to get in front of with our data.' Abbott wanted to hire Dr. Midei 'because he helped us so many times over the years,' yet another Abbott executive said in an email.

Dr. Simonton didn't return phone calls seeking comment.

Abbott sent Dr. Midei to Japan to promote the Xience stent, but bad publicity caused that trip to be cut short in late January, the report says. In total, Abbott paid the doctor $30,623 to help market the Xience, the Senate investigators found. [WSJ]

When the relationship was criticized, Abbott executives responded with threats, or were they jokes?

I called David Pacitti, vice president of global marketing for Abbott Laboratories' cardiac-plumbing division, to ask why he seems to want goons to beat me up in the newspaper parking lot.

'Don't you have connections in Baltimore?????' Pacitti e-mailed a subordinate regarding a January column I wrote on heart-artery stents. 'Someone needs to take this writer outside and kick his ass! Do I need to send in the Philly mob?'

Pacitti and other Abbott execs apparently don't care for suggestions that their expensive vascular devices often do patients little good and that a star Baltimore doctor took their encouragement to be 'truly outstanding' a bit too much to heart. [Sun]

Furthermore,

Pacitti didn't return my phone calls, but an Abbott flack got in touch on Monday.

'We sincerely apologize if this caused you any concern or distress,' the company spokesman said. Pacitti's comment, he said, 'wasn't meant to be taken seriously.'

Yeah, that's what King Henry II said after they whacked Thomas Becket. [Sun]

So here is a particularly vivid case showing how big health care corporations make "key opinion leaders" out of doctors apparently just because they use or prescribe a lot of the company's products, regardless of the doctors' expertise, or ethics.  As we noted before, "key opinion leaders" are seen by corporate marketing executives as fellow travelers or useful idiots (see posts here, and here). It again appears is that all that health care corporate marketers care about is selling product. Whether their pitches are honest or ethical is besides the point. Those who get in their way are treated with contempt, and maybe, just maybe are threatened with violence

The physicians who are flattered at being called "key opinion leaders," or "thought leaders" have got to realize that the marketers think they are chumps. If they think they are providing honest information, or education, they are deluded.

This case has already been widely discussed in the blogsphere.  See, in particular, posts by Dr Howard Brody on the Hooked: Ethics, Medicine and Pharma blog, and Larry Husten on the CardioBrief blog.

But if that were not enough, on the heels of this story came several more about Abbott Laboratories

Abbott Laboratories Settles, Twice

As reported by the Los Angeles Times, while Abbott was trying to hide Dr Midei overseas, it was also busily negotiating settlements of completely separate charges:

Abbott Laboratories and two other pharmaceutical firms agreed to pay more than $421 million to settle claims of defrauding Medicare and Medicaid in the latest in a string of nine- and ten-figure health care fraud settlements announced by the Justice Department.

The drug companies charged one set of prices to doctors and pharmacies but reported another set of inflated figures that were used as benchmarks by government insurers reimbursing health care providers. The spread, or difference, amounted to kickbacks to the companies' customers, according to Tony West, assistant attorney general for the Justice Department's civil division, who announced the settlements on Tuesday.

In particular,

Abbott, of North Chicago, Ill, agreed to pay $126.5 million to settle accusations that it charged the government inflated prices for products ranging from sterile water and saline solution to vancomycin, an antibiotic.

An Abbott spokesman said the company believes 'that we have complied with all laws and regulations' and settled the case to avoid 'the uncertainty associated with continued litigation.'

At least he did not threaten the Department of Justice officials with an attack by the "Philly mob."

But that is not all. The Wall Street Journal reported that Abbott had to make a second, unrelated settlement:

Separately on Tuesday, the Justice Department announced an unrelated $41 million settlement with Abbott subsidiary Kos Pharmaceuticals Inc. on charges that it paid kickbacks to doctors and other health professionals to encourage them to prescribe or recommend the cholesterol drugs Advicor and Niaspan.

As part of that settlement, Kos entered into an agreement that will allow it to avoid prosecution on criminal charges. 'These actions occurred prior to Abbott's acquisition of Kos in 2006 and Abbott has not been accused of any wrongdoing,' an Abbott spokesman said.

However, Abbott chose to acquire a company that allegedly chose to pay kickbacks of this sort. The apparent resemblance to Abbott's payments to Dr Midei in the case above are striking.

By the way, the Los Angeles Times article also noted previous black marks on Abbott's record:

Abbott also paid $614 million in civil and criminal penalties in 2003 to end a federal investigation of the company's marketing practices and Medicaid and Medicare reimbursements.

In 2001, TAP Pharmaceutical Products Inc., of Lake Forest, Ill., an Abbott joint venture, agreed to pay $875 million and plead guilty to a criminal charge of conspiring with doctors to overbill Medicare.

At the time, the TAP penalty was the largest health care fraud settlement in U.S. history, but it has since been eclipsed by at least two others.

So we once again illustrate how punishing wrong doing by fining large corporations, when the fines are just seen as a cost of doing business, in the absence ofany negative consequences on the real people who authorized, directed, or implemented the bad behavior fails to deter future bad behavior.

This remarkable confluence of cases suggest how rotten are the ethical foundations of even large and previously respected health care organizations. I imagine, though, that as long as these corporations richly reward their executives regardless of the ethics of their actions, and regardless of the long term effects on the organizations' reputations, and as long as their are no externally imposed negative consequences on these leaders, the practices will continue, and will get worse.

Health care costs keep rising, access keeps declining, quality gets worse. We moan and wring our hands, but as long as we allow the rot to worsen, and the muck to grow, expect these trends to continue until the whole smelly mess collapses of its own weight (with all those rich executives escaping to their mansions.)

If we really want high quality accessible, reasonably priced health care, we need true health care reform that reduces concentration of power in large organizations, and makes health care organizations' leadership accountable, ethical, and transparent. That will not be easy.

ADDENDUM (8 December, 2010) - See also comments by Maggie Mahar on the HealthBeat blog, David Williams on the Health Business Blog, and Paul Thacker on the Project on Government Oversight blog.