What the Student Loan Scandal Says About the Milieu in Which Medical Schools Operate

We have posted frequently about problems with the leadership of academic medicine in the US. For example, most recently we discussed how American medical schools seem to value faculty members' ability to bring in money from external sources, by clinical billing, or from research grants, over any other criteria of faculty performance. We have also frequently discussed how many medical school leaders, and the university leaders to which they report, have significant conflicts of interest, and that some even serve on the boards of directors of, and hence have ultimate fiduciary responsibilities for the management of major health care companies.

US medical schools operate within larger universities, and now it seems that the universities in which they operate have similar leadership issues. For example, the latest scandal to rock American universities has to do with how they make student loans. An investigation has shown a variety of financial ties among university officials and companies which make loans to their students. Particular examples involving universities that also have medical schools include:

- Several financial aid officers at major universities allegedly held positions in the securities of a loan company, and at least one made a considerable profit from such securities, according to the Associated Press (via Forbes):

The University of Texas put it's financial officer, Lawrence Burt, on paid leave and the University of Southern California did the same with it's financial aid officer, Catherine Thomas. Columbia University had already placed it's associated dean of student affairs, David Charlow, on leave while it investigates Cuomo's claims.
SEC records show Charlow owned 7,500 shares of Education Lending Group's stock and owned 2,500 stock warrants at the time of the stock prospectus. Cuomo's office said Charlow sold the 7,500 shares for about $9.50 each and in 2005 sold more of the securities for a total profit of more than $100,000. Investigators said Charlow bought the securities for $1 a share in 2001. Cuomo's office believes others also got similar deals.

- The Chancellor of the State University of New York (SUNY) system, including 64 campuses and several medical schools, was on the board of directors of a loan company, again per the AP

John Ryan, chancellor of the 64-campus State University of New York system, serves on CIT's board of directors.

Ryan, who announced last month that he will step down at the end of May, has been a director at CIT since July 2003, according to the company's Web site. A company SEC filing shows Ryan earned about $146,000 last year in cash, stock and options for his service on the CIT board. He is paid $340,000 a year as chancellor.

Student Loan Xpress is also listed as a preferred lender at SUNY Maritime College, where Ryan served as president after retiring from the Navy and the Naval Academy in 2002.

- A financial aid officer at Johns Hopkins University "received about $65,000 in consulting fees since 2002 from Student Loan Xpress," according to the Baltimore Sun.

This is the milieu in which medical schools must operate, a milieu in which conflicts of interest seem rampant, and in which university officials may be putting their personal profits ahead of their ostensible mission.

It does increasingly appear that some of society's major institutions, institutions which the public trusts, are increasingly run by people who use their positions of entrusted power to fatten their wallets or further their ideological agendas. Thus the problems afflicting health care leadership may be part of an even larger problem afflicting many of society's important institutions.

As Merrill Goozner put it,

A century ago, the progressive era gave rise to a professional class whose values and ethics arose from the need to mediate the power of newly ascendant corporations on behalf of a public that didn’t have the time or expertise to protect itself from unsafe products and monopoly power. Today, each of the institutions created or empowered in that era to act as counterweights to that power – non-profits and universities, the Fourth Estate and the regulatory agencies – have been subverted by incestuous financial ties with the corporations they’re supposed to influence and oversee.

It's not a pretty picture, but now that the public is increasingly aware of this problem, maybe some of us professionals can show the way towards its solution.

Lifestyles of Rich but Not So Famous Hospital Executives

The Hartford Courant just reported on the ballooning salaries of top executives of not-for-profit hospitals in the state of Connecticut.

The head of Middlesex Hospital earned $1.9 million last year, making him the highest-paid hospital administrator in the state. In just three years, CEO Robert Kiely's compensation nearly tripled, part of a trend in soaring compensation packages for hospital leaders.

Last year, Kiely and seven other Connecticut hospital administrators - three of them top managers in the Yale-New Haven Hospital Health System - made more than $1 million.

The Courant ranked the highest-paid hospital CEOs in Connecticut using data recently filed with the state Office of Health Care Access.

Yet, a close look at the numbers shows how arbitrary compensation can be. In Middletown, Kiely heads a community hospital that has expanded its ER but is not a state-approved trauma center. In New Haven, [Marna] Borgstrom oversees a teaching hospital [Yale-New Haven Hospital] and two smaller hospitals that together bring in three times the revenue. Though both executives made roughly the same in salary, Kiely received an extra $395,000 in benefits-most of it retirement money.

At Stamford Hospital, [Brina] Grissler made $376,000 more last year than Hartford Hospital President John Meehan, who oversees a health system with three times more revenue. A spokesman said Grissler's compensation takes into account his long tenure and the cost of living in Fairfield County.

The article provided some rationalizations for how much hospital executives now make.

The hospitals say they need to offer competitive pay to keep talented managers. The job of running a hospital has grown more complex, they argue, amid falling government reimbursement rates for services and rising demand for charity care.

'We can't do excellence on the cheap,' said James Matschulat, head of the compensation committee at Middlesex and a retired insurance executive. 'We compete with every hospital in the nation for top talent.'

Strong leadership is needed for hospitals to succeed financially, and therefore serve the public good, the hospitals contend. 'These are very complicated and difficult businesses,' said Robert Ritz, CEO at St. Mary's, a Catholic hospital in Waterbury. 'We have a charitable, social and healing mission.'

On the other hand, such lavish compensation of managers of not-for-profit organizations often considered charities makes some people uncomfortable. Although excellence may not come cheap, it is not clear that all hospital executives are excellent. And some of the explanations proposed for the phenomenon are not so rational as those above.

'Think about how many uninsured people that would cover,' said Ellen Andrews, head of the Connecticut Health Policy Project in New Haven.

Compensation at nonprofits is exploding because board members often come from the corporate world, where lavish CEO salaries are accepted, said Pablo Eisenberg, a senior fellow at Georgetown University's Public Policy Institute. Compensation consultants are also driving up pay by referencing corporate salaries in their surveys. As the salary gap widens between top managers and their staff, teamwork and collegiality suffers, he argues.

'Boards are not exercising their fiduciary duty,' he said. 'No one is questioning these excessive compensations.'

Note that we previously posted about arguments that hospital board members see their job mainly as a networking opportunity and a chance to go to fancy social events, at least in Massachusetts, Connecticut's northern neighbor.

As briefly mentioned in the Courant article, Senator Charles Grassley, (R-Iowa) also views lavish pay of hospital administrators with a jaundiced eye, and the scope of his concern is not restricted to the states of Connecticut or Massachusetts. As noted in the Chronicle of Higher Education,

A powerful Republican senator has asked the Government Accountability Office, Congress's investigative arm, to examine how much free care and other services nonprofit hospitals provide to the regions in which they are located.

Sen. Charles E. Grassley of Iowa said he is concerned that hospitals may not be providing enough services to their local areas to justify the tax breaks they receive. Mr. Grassley, the top Republican on the Senate Finance Committee, also said that some hospital executives and board members may be overpaid.

'There have been alarming reports about the lavish lifestyle that some of these individuals lead courtesy of the nonprofit hospital as well as the business ventures that enrich these individuals to the detriment of the nonprofit hospital,' he said.

In my humble opinion, there are some hospital executives who certainly earn every dollar they make.

But it seems that

• hospital executives' total compensation is often well concealed
• the relationships among such compensation and hospital size, hospital performance, and CEO performance are not obvious
• many anecdotes, most muttered quietly in hallways, suggest very well-paid CEOs live lavish life-styles disproportionate to their hospitals' size, charitable mission, and struggling financial status
• such disproportionate pay and life-style of some hospital CEOs may demoralize their employees and health care professionals, even while delighting their golf-playing buddies among the local gentry
• I would believe the sincerity of those who espouse pay for performance (P4P) for physicians if they were equally enthused about applying some measure of rationality to the compensation of health care executives.

Note, for an interesting discussion of hospital CEO pay orchestrated by the one hospital CEO who sets an example of transparency by blogging, see this post on Running a Hospital, and its associated comments.

Defending Conflicts of Interest and How eSapience Was "Shaping the Debate"

Last week we posted about a prominent commentary, entitled "Drug Crazy," by Richard Epstein, a Professor at the University of Chicago, in the Wall Street Journal. We noted that Prof Epstein seemed to rely on a number of misconceptions about clinical research to defend how the US Food and Drug Administration (FDA) allows people with conflicts of interest to serve on its advisory boards. The WSJ subsequently published a letter by Marcia Angell making similar points, rather more succinctly.

Now it turns out, as the Boston Globe reported, that Prof Epstein seems to have been part of an unusual enterprise that offered to "shape the debate" in return for fat fees from well-heeled clients. Per the Globe,

A high-powered academic team's work for a billionaire executive facing charges of improper accounting has raised questions about the appropriate relationship between academic consultants and the businesses they advise.

Business ethicists are questioning why the academics, affiliated with some of the top business and law schools, joined a campaign to repair the image of Maurice R. 'Hank' Greenberg , who was forced to resign in February 2005 as chairman of American Insurance Group Inc., billing him at rates of $400 to $1,000 an hour.

The academics, working with eSapience, a little-known Cambridge company calling itself a new media and research firm, included Richard Schmalensee , dean of MIT's Sloan School of Management; David S. Evans , adjunct professor at University College London; and Richard Epstein , a University of Chicago law professor.

The lawsuit identifies Schmalensee as managing director of eSapience, Evans as chairman, and Epstein as an affiliate.

The eSapience plan summary ... lists several other academics as members of what it calls its 'core academic team and network,' suggesting 'they are ready to begin the development of the papers, articles, opeds, books, monographs, and other content related to our key themes,' such as the onerous insurance regulatory environment.

eSapience's website, no longer apparently working, but cached by Google, advertised that the company "shapes the debate on issues that intersect law, economics, and policy. Through its global network of academics and other public intellectuals, the firm publishes leading journals, organizes high-level briefings and closed-door sessions, and creates a variety of other on- and off line venues...."

Ethics experts interviewed by the Globe were not amused.

'Academics are supposed to be independent thinkers,' said Jim Hoopes , professor of business ethics at Babson College in Wellesley. 'Once academics start getting paid for their opinions in this way, there is less confidence in the integrity of their ideas.'

'Resurrecting the reputation of certain people who deserve a plaque in the hall of infamy because of past wrongdoing is not proper,' said W. Michael Hoffman , executive director of the Center for Business Ethics at Bentley College in Waltham. 'That these are professors within universities that should be the last bastions of integrity is cause for question.'

Of course, we have blogged quite a bit about medical academics working part time for pharmaceutical, biotechnology, or device companies, and speaking or writing as academics in ways that seem to aid the companies' marketing objectives (for example, here and here.) However, I don't recall hearing of medical academics forming their own company and then soliciting marketing work from drug companies. An article from PRWeek about the case noted,

The case is also notable for the way in which eSapience brazenly touted its ties to respected academic institutions as a selling point that could be leveraged on behalf of paying clients. In its plan summary, the firm promised to 'leverage our relationships with important and highly credible channels, including [think tanks], MIT, University of Chicago Law School, and The Federalist Society, among others. Those organizations will work with us to host conferences... co-author papers' and on other work.

It makes you wonder whether some of the many other arguments that regulation of high-flying health care corporations would stifle life-saving innovation were similarly based on "leveraged relationships," forged by firms that used ostensible academics to "shape the debate" in ways favorable to those paying their fees.

In any event, this case certainly does nothing to increase the credibility of Prof Epstein's arguments defending the FDA appointing advisory board members with conflicts of interest. It does provide yet another reason to better disclose and regulate the financial dealings of academics in medicine and health policy with organizations that have vested interests in these areas.

ADDENDUM (18 April, 2007) - In Epstein's WSJ article, he disclosed consulting "frequently with pharmaceutical companies," but not which ones. In a 2007 article on conflicts of interest [Epstein RA. Conflicts of interest in health care: who guards the guardians? Perspect Biol Med 2007; 50: 72-88.], Epstein revealed he has "served as a consultant to the Pharmaceutical Research and Manufacturers of America (PhRMA) and to Pfizer...."

Annals of Internal Medicine Shows Appropriate Skepticism About a Commercially Sponsored Clinical Trial

The Annals of Internal Medicine just published a clinical trial that compared a new type of anti-diabetic drug, exenatide, (Byetta, from Eli Lilly & Co, and Amylin) an incretin mimetic, to placebo for patients already being treated for Type 2 diabetes. [Zinman B, Hoofwerf BJ, Garcia SD et al. The effect of adding exenatide to a thiazolidinedione in supoptimally controled type 2 diabetes: a randomized trial. Ann Intern Med 2007; 146: 477-485.]

The article was typical of the commercially sponsored clinical trials that appear in many journals. The Annals, however, made a publishing decision that was atypical of how many journals handle such articles. It included an accompanying editorial that was appropriately critical of the study design and methods, and appropriately attuned to how commercial research sponsors, such as pharmaceutical companies, biotechnology companies, and device manufacturers, may manipulate how research is designed, carried out, analyzed, and reported to serve their vested interests.

We have blogged about such research manipulation before. See our posts about Richard Smith's catalog of manipulation strategies, about specific strategies used in a study of muraglitazar, about David Healy's description about manipulation strategies used for studies of SSRIs (selective serotonin reuptake inhibitors), and Wally Smith's summary of the creation of pseudoevidence. But commercially sponsored articles whose design, execution, and analysis have been manipulated to serve their sponsors interests slip into print regularly, unaccompanied by any notice of how they serve commercial purposes.

The Clinical Trial of Exenatide

In summary, the trial by Zinman et al compared exenatide to placebo in patients already received either rosiglitazone (Avandia, by GlaxoSmithKline) or pioglitazone (Actos, by Takeda Pharmaceuticals), sometimes also metformin, but who were not necessarily trying to modify their lifestyles (either their diet or exercise schedule). A total of 233 patients were randomized, and followed for 16 weeks. Patients in the exenatide group had a statistically significantly lower hemoglobin A1c level, a measure of overall control of blood sugar, at the end of the trial. They also had statistically significantly greater rates of nausea and vomiting, and greater rates of dropping out due to adverse events.

The Editorial

Accompanying the trial was an editorial [Malazowski S. Exenatide in combination therapy: small study, big market, and many unanswered questions. Ann Intern Med 2007; 146: 527-528.] The editorial amounted to a rigorous critical review of the trial. It pointed out most of the trial's many design and methodologic problems, and explained why its results were less than earth-shaking.

These problems included:

• Difficulty determining to whom the results would apply - The patient population consisted of people who did not have their diabetes under excellent control, but were not on optimal medication regimens, and were not trying to improve their diets or increase their exercise. Thus, "we simply don't know whether patients optimally treated with diabetes education, diet, TZDs, [thiazolidinediones] and metformin will receive as much benefitfrom exenatide as the paper reports," since such patients were not included in the study. Nor could the study predict whether adding exenatide would work better than simply increasing the doses of conventional medication, or starting a diet modification or exercise program.
• Short duration - Although diabetes is a chronic problem, the study did not assess the new medication in long-term use. Thus, it was not designed to tell whether it would work in the long run, whether it would affect the patients' longevity, development of complications, symptoms or health status in the long run, and whether it would lead to adverse effects in the long run that did not occur in the short run.
• Small sample size - "Small and short studies provide a false sense of safety, because common severe drug reactions may not occur in the condensed timeline and the limited number of patients." Even so, patients who received exenatide had a relatively high rate of nausea and vomiting, often leading to discontinuation of the drug. So the study did not suggest that any benefits of the drug clearly outweighed its harms. [Note that the editorial did not mention that patients on exenatide also had higher (but not statistically significantly higher) rates of hypoglycemia, low blood sugar, than did patients given placebo. Hypoglycemia, which can be serious, is the main hazard of aggressive treatment of blood sugar. One patient on exenatide also developed an unusual, possibly allergic reaction, allergic alveolitis. The study was clearly too small to predict the rates of these effects that would occur if the drug were used in large numbers of patients. Thus, there is suspicion that the benefit/ harm ratio of this drug is even less favorable.]

Furthermore, the editorial pointed out the relationship between the study's commercial sponsorship and its flawed design. Malozowski stated, "the study was designed, conducted, and analyzed by employees of the manufacturer in collaboration with academicians...." (Note also that the three academicians who contributed to the study all worked part-time for the manufacturers as consultants and/or speakers.) So, "the design and reporting of Zinman and colleagues' study reminds us that the manufacturers control the flow of information about its product. By virtue of FDA approval for the combination of exenatide and TZDs, the data obtained in the study can lead to enormous financial benefits to the sponsor. Millions of patients received TZDs and metformin - now physicians may consider adding exenatide. Great power requires great responsibility. Physicians and patients need answers to the many questions raised by this small study."

In my experience, rarely have I seen a commercially sponsored study whose flaws all seemed to increase the likelihood of finding results favoring the sponsor's vested interests published with an accompanying commentary that pointed out these flaws and their relationships to these vested interests.

Given the great efforts commercial sponsors make to get studies with results favorable to their products published, it would be nice if all journals accompanied such articles with appropriately critical accompanying commentaries.

Kudos to the Annals of Internal Medicine for showing the way forward.

Medical Schools to Faculty: "Show Me the Money"

We have posted before (here and here) about how medical schools, despite their name, often fail to pay or otherwise reward faculty to actually teach.

This month's SGIM [Society of General Internal Medicine] Forum (should be available here on p. 13) features an interview with Dr Lee Goldman, the Dean of the Faculties of Health Sciences and Medicine, and Executive Vice-President for Health and Biomedical Sciences at Columbia University. Dr Goldman, despite being a cardiologist, is a former President of SGIM, whom I had a chance to work with when I was the editor of the predecessor to the Forum. Dr Goldman is known for saying it like it is. In the interview, he explains with brutal honesty how things now work in academic medicine, and thus explains the apparent paradox of medical schools that do not pay their teachers to teach.

[Dr Goldman was asked to talk about academic careers....] I'd add something about the cold, hard facts of Academic Economics 101. There are four categories of faculty: 1) 'Taxpayers' who generate more than they cost and help fuel the academic mission; 2) 'Hired workers' who get paid to do a job that many people might like to do; 3) 'Loss leaders' who get short-term investments in the expectation that they will become successful 'taxpayers;' and 4) 'Welfare recipients' - faculty with more tenuous status.

Bottom line, you should strive to be a 'taxpayer.' If you're a 'hired worker,' you should strive to be better than the others who would like your job.

Dr Goldman reveals that in the typical medical school, the most important criterion for faculty success if generation of external funding, that is, generation of fees for clinical work, or of grants from external sponsors. Whether a faculty member is good at patient care, teaching, or research, or whether he or she upholds the highest professional standards, is secondary.

At first glance, to someone outside of academic medicine, this seems nonsensical. The incentive system described by Dr Goldman seems to be like the commission system used to reward some automobile sales people (at the smarmier dealerships). The system seems utterly different from that used in other parts of "higher" education, in which faculty are usually paid straight salaries based on rank and seniority.

The system used in academic health care may be nonsensical. It is too bad those of us in or recently departed from this arena have gotten so used to it that it seems normal.

Let me explain the context a bit. At most medical schools and academic medical centers, accounting reports are created for each faculty member. The methods used to compile these reports are such that only clinical reimbursement or external grant funding "counts." Faculty who generate more such reimbursement or funding are the "taxpayers" to whom Dr Goldman refers.

But these accounting methods are often very artificial. These institutions actually receive quite a lot of money that is meant to support patient care and the academic mission. They collect tuition fees to support education. Academic medical centers receive millions from Medicare for graduate medical education, that is, education of interns, residents and fellows, divided into direct graduate medical education and indirect medical education funds (look here). State medical schools receive state support funds. Private, not-for-profit universities receive contributions that are tax-deductible for the donors, and collect interest and dividends from their endowments that are also not taxed. Yet rarely do faculty get "credit" for generating any of these sorts of funds. Why they don't is unclear, and, on its face, absurd.

The current accounting systems result in bias against general internists, and other primary care faculty. Since, as we have noted before, reimbursement rates for primary care and cognitive services are low, such faculty cannot become "taxpayers" by virtue of their clinical practice. (Faculty who do procedures, like invasive cardiologists, can generate enough large fees to become "taxpayers.") Furthermore, primary care faculty are often tasked with taking care of poor patients, and doing more than an average amount of education of medical students, interns, residents, and fellows, but the accounting systems do not count any of this work as generating external reimbursement. Thus, at best, really hard working generalist faculty can aspire to be "hired workers," and are in danger of being viewed as "welfare recipients." They will rarely be "taxpayers."

The only practical way for a generalist, and the best way for any faculty member to become a "taxpayer" is to generate external grant funding. Some faculty may be talented and lucky enough to get grants from federal agencies like the National Institutes of Health, or from foundations. I used the term "lucky," because such grant money is limited in amount, and limited in scope to the priorities of these organizations. Again, these priorities are often not the clinical and health services research that generalist academics may do. Thus, to generate external grant funding, most faculty, but particularly generalist faculty, must turn to pharmaceutical companies and other commercial sponsors. Working with such sponsors often entails giving the sponsors considerable control over the design, execution, and analysis of the research, and dissemination of its results. Medical schools and academic medical centers have often been only too happy to turn over such control (see post here). And pleasing commercial sponsors may lead to financial entanglements and conflicts of interest.

To summarize, the contemporary medical school seems to judge faculty by asking them to "show me the money."

And this emphasis on generating certain kinds of external funding helps explain the neglect of teaching, and the increasing corporate influence over academic health care.

The call to "show me the money" is mission-hostile management, writ large, of some of our most important, and heretofore revered academic medical institutions.

The continuance of such mission-hostile management may yet doom these institutions.

Pfizer Inc: the Dots Unconnected

A number of vivid stories about Pfizer Inc., the world's biggest pharmaceutical manufacturer, quietly slipped into public view this week. Yet the dots they represented were not connected.

First of all, as reported by Reuters and the Associated Press, units of the company pleaded guilty to a criminal charge, and separately entered into a deferred prosecution agreement with the US Department of Justice. As reported by the AP,

Two subsidiaries of Pfizer Inc. have agreed to pay fines totaling $34.7 million for offering a kickback to recommend company drugs and for illegally promoting the human growth hormone product Genotropin for nonapproved uses, federal prosecutors said yesterday.

Prosecutors allege that Pharmacia & Upjohn Co. offered to overpay a subsidiary of a pharmacy benefit manager by $12.3 million in the hope the company would, in turn, recommend Pharmacia's drug products to its clients.

Pharmacia hired the pharmacy benefit manager to distribute Genotropin. Prosecutors allege the company then offered to make excess payments on the distribution contract in an effort to improperly influence the unnamed pharmacy benefit manager's decision on which drugs to include on its list of product recommendations.

Under a plea agreement filed in US District Court yesterday, the company has agreed to plead guilty to one count of offering a kickback and to pay a criminal fine of $19.7 million.

Another Pfizer subsidiary, Pharmacia & Upjohn Co. LLC, has agreed to pay $15 million to settle allegations that it illegally promoted Genotropin for uses not approved by the Food & Drug Administration. [Note that as mentioned below, this was actually not the settlement of a civil charge, but entry into a deferred prosecution agreement - Ed]

Prosecutors allege that Pharmacia & Upjohn promoted Genotropin for antiaging, cosmetic use, and athletic performance enhancement.

Sullivan [not further identified in this version of the story, but actually US Attorney Michael J Sullivan of Massachusetts] noted that New York-based Pfizer, which acquired Pharmacia in April 2003, acted responsibly when it disclosed Pharmacia's unlawful promotion of human growth hormone to various federal government agencies in May of that year.

There is a considerable back-story here. Some is in Brandweek, particularly regarding the arrangements Pfizer made with the pharmacy benefits manager.

In the plea agreement, the vendor is not named. However, the agreement describes how Pharmacia awarded a contract to a pharmacy benefit manager in return for that company recommending that its customers purchase other Pharmacia products. The vendor got the contract, despite a competing bid that was “$12 million less expensive” than the vendors’ bid.

The settlement’s description of the kickback scheme matches a series of allegations reported by Brandweek last year. (Bad Medicine, March 20, 2006).

Two Pharmacia executives, ex-marketing vp Peter Rost and former senior director of U.S. marketing Carl Worrell, told Brandweek that Express Scripts managed the Genotropin patient assistance program even though other companies had offered to handle the business for much less money.

Rost said that when he tried to move the contract to the cheaper vendor he was told that it was balanced out by an advantageous relationship Pharmacia had with Express regarding its much bigger drug, the painkiller Celebrex. 'There was some setup in accounting so the Celebrex team reimbursed us $2 million,' Rost said at the time.

Both Pfizer and Express have repeatedly disclosed to the Securities and Exchange Commission that they were under investigation by the DOJ for this type of issue. Express declined comment at press time.

Pfizer distanced itself from the probe in today’s release. 'Pfizer’s marketing and promotion practices are not involved in the settlement,' said Pfizer svp-general counsel Allen Waxman in a statement.

The settlement ends the DOJ’s interest in Pfizer, but it does not end Pfizer’s legal entanglements with Genotropin—Pfizer remains a defendant in two legal cases related to the fiasco. In both cases, Rost sued Pfizer alleging he was wrongly fired for complaining to Pfizer prior to its acquisition of Pharmacia that the company was engaged in off-label marketing. His federal whistleblower complaint is currently being heard by an appeals court in Massachusetts; his wrongful termination suit is pending before New York State Supreme Court in Manhattan.

The Corporate Crime Reporter (a legal newsletter) had some pithy comments on the case, and how it was (or wasn't) reported,

Pfizer’s Pharmacia & Upjohn Company Inc. unit pled guilty yesterday to offering a kickback in connection with the sale of its human growth hormone product.

The Wall Street Journal, New York Times, and Washington Post ignored the story. [Actually, the Wall Street Journal ran the AP version.]

Why is unclear.

A second Pfizer unit, Pharmacia & Upjohn Company LLC, entered into a deferred prosecution agreement for illegally promoting its human growth hormone Genotropin for such off-label uses as anti-aging, cosmetic use and athletic enhancement.

U.S. Attorney Michael Sullivan [that is who the "Sullivan" mentioned above apparently is - Ed] said Pfizer 'acted responsibly' for voluntarily and fully self-disclosed the off-label promotion of Genotropin.

This ticked off Peter Rost.

Rost was a vice president at Pfizer when he discovered the criminality and blew the whistle.

Rost has two lawsuits pending against Pfizer.

One lawsuit accuses Pfizer of violating the False Claims Act. That lawsuit is pending on appeal to the First Circuit Court of Appeals in Boston.

The other – for wrongful dismissal – is in discovery.

How come the Justice Department is praising Pfizer and not Rost?

'The Justice Department praised Pfizer for self-reporting,' Rost told Corporate Crime Reporter. 'But Pfizer would have done nothing if I didn’t twist its arm. I was floored when I read the press release. They have one guy who lost his career, lost his job for doing the right thing. That would be me. And they praised the company that fired me?'

In fact, the U.S. Attorney’s criminal investigation was triggered by the filing of Rost’s False Claims Act case.

Rost documents the history of the case in his book – The Whistleblower: Confessions of a Healthcare Hitman.

And Rost testified twice before the federal grand jury in Boston that investigated the Pfizer criminal wrongdoing.

And yet the federal government refused to join Rost in his False Claims Act case.

Note that Health Care Renewal mentioned Rost's firing here. Further note that Rost is now a prolific blogger, and he has quite a bit more to say about the settlements and how they were reported on his blog, Question Authority.

One would think that it would be big news when the world's largest pharmaceutical company pleads guilty to one criminal charge, and enters into a deferred prosecution agreement regarding another such charge. But so far, as of today, only 33 media outlets have run any version of this story. No major newspaper has done any original reporting on it so far. Very few large market outlets have run the story at all (and the Los Angeles Times ran a very short version that omitted mentioning that the settlements were of criminal, not civil charges.) None of the wire service versions of the story noted that the second "settlement" was a deferred prosecution agreement, instead leaving the impression that it was a settlement of a civil dispute. And I have found no editorial commentary in the main stream media about it at all.

Thus, given the severity of the issue, this seems to be a prime example of what we have called the "anechoic effect." Surely this story merited more and more complete coverage than it received. And given how much ongoing concern there is about rising health care costs, declining access, and stagnant quality, this sort of story deserved some editorial attention outside of the blogsphere.

That was the largest dot. But there were others.

Also this week, Newsday reported that Pfizer is trying to get doctors to counter any attempts by managed care organizations or pharmacies to get patients to switch from Lipitor (atorvastatin) to generic simvastatin for the treatment of high cholesterol.

Pfizer, faced with the potential loss of billions of dollars as patients with high cholesterol switch from Lipitor to generic Zocor, has been helping doctors wage a letter-writing campaign to slow the tide.

Lipitor's U.S. patent doesn't expire until March 2010, but health plans are encouraging patients and doctors to switch to the cheaper generic Zocor, or simvastatin.

Pfizer sent doctors a CD containing two letters, one to health plans, one to pharmacists. The letters argue that switching from Lipitor to a generic statin "for cost reasons alone will undermine the clinical judgment that went into the decision to prescribe Lipitor for this patient."

'They're using doctors as a human shield to protect them from losing business,' said Sidney Wolfe, director of the Public Citizen Health Research Group. 'I would say it's unethical.'

I would add that it would not be unethical for Pfizer to try to persuade physicians not to switch their patients to a generic medication. But what Pfizer is doing sounds more like another variant of stealth lobbying.

And there was one more dot.

Oh, also this week, Reuters reported that the UK Office of Fair Trading is probling Pfizer's new policy of striking deals with specific drug distributors, rather than making drugs available to competing wholesalers. The OFT noted that Pfizer's new policy "caused 'great concern' to many in the market and the investigation was an important study of a 'priority sector'. 'The study will consider the likely impact of such changes on competition, the NHS (National Health Service) and patients...."

We have posted about how pharmaceutical executives worry about their companies' negative images (see relevant post here). I would suggest that a good first step to better images would be avoiding conduct for which guilty pleas become necessary. Another good step would be to have the industry make its own arguments, and end the stealth marketing and stealth lobbying. Finally, avoiding business practices that might be seen as anti-competitive would help.

The leaders of the main stream media have been worrying about their declining readership. Maybe if they were able to connect some of the dots like the ones above, they might get more peoples' attention.

"The Ugliest Night I Have Ever Seen" - 60 Minutes on How the Medicare Drug Benefit Bill Was Passed

The legendary television news magazine, 60 Minutes, just did an expose of how the US Medicare Part D prescription drug benefit bill was passed. It is well-known that US drug prices have continued to increase since this bill, which prevented Medicare from negotiating the prices it paid on behalf of patients for drugs.

The vote for the bill came in the wee morning hours, in a process that a Republican congressman who opposed the bill described as "the ugliest night I have ever seen in 22 years."

It is worth reading the full transcript of the story, but what I found most striking were the number of relationships it cataloged between congresspeople, staffers, and other federal officials and the pharmaceutical industry. These included:

• Bill Tauzin (Republican - Louisiana), who "steered it [the bill] through the house," within a few months "began discussions with the pharmaceutical industry to become its chief lobbyist in Washington." Tauzin had an "extremely rare" tumor removed, and was treated "with a new medicine, Avastatin, that had never been used on that form of cancer. The treatment was succesful , and as a result Tauzin felt he owed his life to the drug industry." [but apparently not to the surgeon - Ed] "After serving out his congressional term, he accepted a $2 million-a-year job ... as president of PhRMA - Pharmaceutical Research and Manufacturers of America."
• Medicare Chief Actuary Richard Foster said he "was told to withold the new numbers" that gave an honest estimate of the cost of the new drug benefit, and said "the person who told him to withhold Congress from getting the revised estimates was Medicare boss Tom Sculley." But, "Sculley was the administration's lead negotiator on the prescription drug bill, and at the time was also negotiating a job for himself with a high-powered Washington law firm, where he became a lobbyist with the pharmaceutical industry."
• Multiple former federal legislators helped lobby for the bill, including "former senators Dennis Deconcini (D-Arizona), and Steve Symms (R-Idaho), and former congressmen like Tom Downey (D-New York), Vic Fazio (D-California), Bill Paxon (R-New York), and former house Minority Leader Robert Michel (R-Illinois)."
• "John McManus, the staff director of the Ways and Means subcommittee on Health. Within a few months, he left Congress and started his own lobbying firm. Among his new clients was PhRMA, Pfizer, Eli Lilly and Merck. "
• "Linda Fishman, from the majority side of the Finance Committee, left to become a lobbyist with the drug manufacturer Amgen. "
• "Pat Morrisey, chief of staff of the Energy and Commerce Committee, took a job lobbying for drug companies Novartis and Hoffman-La Roche. "
• "Jeremy Allen went to Johnson and Johnson. "
• "Kathleen Weldon went to lobby for Biogen, a Bio-tech company. "
• "Jim Barnette left to lobby for Hoffman-La Roche. "

One Republican congressman who opposed the bill commented thus about Billy Tauzin's new job, "I mean, when you're pushing so hard for a bill that's controversial and you have to keep the machine open for three hours to get the one vote necessary to pass it, and then, within a matter of months you go to work for the industry that's gonna benefit from it, it does cause you some concern."

Well, if nothing else, this case shows that it is not only physicians and medical academics who have issues with conflicts of interest involving the pharmaceutical and biotechnology industries.

It also suggests that simplistic arguments between advocates of private insurance and single-payer government financed insurance, each claiming that their approach would solve all our health care problems, completely miss the point.

What would help to solve our problems is to get rid of the conflicts that interest that affect health care policy, not just academics and policy experts paid on the side by commercial health care firms, but legislators and legislative staff working to impress their eventual commercial employers, when they are supposed to be representing the public.

See also the post on PharmaGossip, and the post on PharmaLot.

New Data, More Doubts About Pay-for-Performance (P4P)

Two recent health care research articles and their accompanying editorials once again question the premises which undergird the currently fashionable pay-for-performance (P4P) movement.

We have posted skeptically here, here, and here about P4P. Briefly, our concerns were that P4P could lead to perverse incentives (by rewarding apparently better rates of good outcomes which could be created by avoiding the sickest patients, or emphasizing a few measured processes and thus distracting physicians from doing anything else, or being based on inaccurate or irrelevant data), could emphasize cost cutting over quality, and could emphasize processes which have been better studied, potentially penalizing the specialties that did the most research about quality.

Rapid Antibiotic Treatment for Patients with Pneumonia

The first article(1), currently only available online, addressed a performance measure already in wide use, whether patients with a provisional diagnosis of community-acquired pneumonia receive an antibiotic within four hours of hospital arrival. This is a core quality of measure per the Center for Medicare and Medicaid Services (CMS) and the Joint Commission on Accreditation of Healthcare Organizations (JCAHO). The University HealthSystem Consortium's goal is 90% achievement of this measure. The authors' hospital already bases physician payments on the achievement of this measure.

Fee and Weber constructed a retrospective cohort of patients eligible for this measure according to JCAHO and CMS standards. They then examined the 34.9% of them who failed to meet the standard, i.e., failed to get antibiotics within four hours. They found that 58.5% in turn of these outliers, or 20.4% of the total patient cohort, had not been diagnosed with community acquired pneumonia at the time they left the Emergency Department (ED). Thus the performance measure for treatment of pneumonia was being applied to patients who did not clearly have pneumonia at the time the treatment decisions had to be made.

The accompanying editorial(2) noted many problems with the "four hour rule," in part based on this data. Most important is that the diagnosis of pneumonia is not always obvious in patients presenting to the ED. Yet the four hour rule standard as currently applied requires physicians to give antibiotics promptly to patients who do not obviously have pneumonia at the time the physicians saw them, and whose diagnosis was made only later. It seems obviously unfair to require physicians to be clairvoyant. The risks are that emphasis on the four hour rule, including payments made to physicians who fulfill the standard more often, will induce physicians to unnecessarily treat lots of patients with possible pneumonia with antibiotics in the hopes that some will turn out to have pneumonia, raising costs, causing side effects, and creating more antibiotic resistance. Thus, this data suggested how this particular performance measure was likely to have perverse effects.

Aggressive Glucose Lowering Treatment for Diabetes

The second article(3), published this month, addressed another well-known performance measure. This is the proportion of patients with diabetes mellitus who have hemoglobin A1C values less than 7%, as endorsed by the National Quality Forum and the National Committee on Quality Assurance.

Pogach et al retrospectively identified a cohort of patient with diabetes, then assessed the proportion of patients in this cohort who might not benefit from the application of the standard, because the results of the clinical research on which the standard was based might not apply to them. In particular, they identified patients with decreased life-expectancies or multiple or severe co-morbid conditions. Their criteria for identifying these patients were based on the exclusion criteria used by the major controlled trial of aggressive glucose reduction in patients with adult-onset diabetes, the UKPDS study. They found that 21.7% of their cohort had major co-morbid illnesses, 7.9% had major mental health problems, and another 4.4% had multiple co-morbid conditions, suggesting that 34.1% of the patients to whom the standard might usually be applied might not benefit from it. This is important because the aggressive control of diabetes needed to achieve a low hemoglobin A1C value at best only benefits patients by decreasing their risk of certain diabetic complications long term, but raises the risks of hypoglycemia (low blood sugar), which can be dangerous or fatal, for as long as treatment remains aggressive. The results of this study suggest that the performance measure could be applied to many patients who may never benefit from it, but would be at continuous risk of aggressive lowering of blood sugar. Again, this suggests how this performance measure might have perverse effects.

This article was accompanied by a pithy editorial by Rodney Hayward. Hawyard dissected problems with outcome-based performance measures that can lead to perverse results. Some of his observations particularly deserve quoting:

This editorial ... will discuss the broader question of why this intuitively appealing approach - using 'optimal' treatment goals as performance measures - will almost always require more sophisticated approaches ... or else risk generating performanc meausres that are inaccurate, promote waste, and perhaps cause substantial patient harm.

Readers may be perplexed as to why 2 new outcome measures lacking any risk adjustment were adopted. In truth, these new measures were a compromise between advocates of optimal goals (disease advocates) and advocates of simple, inexpensive performance measures (health plan leadership). Experts in evidence were not included in the compromise, which is part of the problem.

Payers, disease advocates, consumer groups, and political leaders are often dismissive of the complex reality of measuring care....

Wishful thinking will not transform poor performance measures into useful ones, and that well-meaning people have a profound aptitude for letting their desires and ideology blind them to unwanted facts and complexities that are so vexingly common in the real world.

Promoting optimal care using performance measures requires considering the very real tensions among treatment-related benefits and treatment-related burdens, risks, and costs. HL Mencken once said, 'for every problem, there is a solutiont that is simple, neat, and wrong,' and using unadjusted, 'all-or-nothin' optimal treatment targets as performance measures is such an example.

Some leaders in performance measurement have asked me, 'do you really think that these measures will lead clinicians and health systems to overtreat?' I am frankly amazed by this question. Spiraling healthcare costs and overtreatment are probably the defining feature of the US healthcare system. Industry-funded 'experts' and disease advocates have been effectively promoting overtreatment for decades, and performance measurement was supposed to be a tool to bring better value to healthcare spending. Although performance measurement has proved to be a very powerful took, like all tools it provides opportunities for both benefit and harm.

Again, as we have noted before, developing performance measures that will truly benefit patients will require detailed understanding of the clinical context, keen skeptical analysis of the available relevant research data, and careful balancing of benefits, harms and costs. All this would be very hard under the best of circumstances. But the continual attempts by those with vested ideological and financial interests to influence performance measures to advance their own interests make it unlikely that the whole P4P movement will have any good effects on patients.

The first improvement needed in the P4P movement is clear, detailed disclosure of all conflicts of interest affecting those involved in the movement at any stage.

At this point, patients and physicians should be very skeptical about who is likely to benefit from any new performance measure, particularly measures that are lavishly promoted.

References

1. Fee C, Weber EJ. Identification of 90% of patients ultimately diagnosed with community-acquired pneumonia within four hours of emergency department arrival may not be feasible. Ann Emerg Med 2007. [now available on-line only]
2. Pines JM. Measuring antibiotic timing for pneumonia in the Emergency Department: another nail in the coffin. Ann Emerg Med 2007. [now available on-line only]
3. Pogach LM, Tiwari A, Maney M et al. Should mitigating comorbidities be considered in assessing healthcare plan performance in achieving optimal glycemic control? Am J Managed Care 2007; 13: 133-140. [link here]
4. Hayward RA. All-or-nothing treatment targets make bad performance measures. Am J Managed Care 2007; 13: 126-128. [link here]

More Indictments at UMDNJ

The pain at the University of Medicine and Dentistry of New Jersey (UMDNJ) just goes on and on. We have previously discussed, seemingly ad infinitum, the troubles there. The university now is operating under a federal deferred prosecution agreement with 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).

This just in, via Bloomberg News,

New Jersey Senator Wayne Bryant, once one of the state's most powerful Democrats, was indicted today on corruption charges and accused of trading his political influence for a job at the state's medical university.

Bryant, 59, was charged in a 20-count indictment of engaging in a 'scheme and artifice to defraud the public of honest services.'

Bryant ... was accused by a federal monitor of directing millions of dollars to the University of Medicine and Dentistry of New Jersey after receiving a 'no-work' job there. R. Michael Gallagher, former dean at the medical university's school of osteopathic medicine, was also charged today in the indictment.

According to the indictment, Gallagher in 2003 gave Bryant the title of program support coordinator at the osteopathic school at a starting pay of $35,000 a year. The job helped Bryant accrue credit toward his state pension.

Bryant, according to the indictment, used his senate staff to arrange meetings for Gallagher with members of the Senate budget committee, at which Gallagher presented a 'white paper' regarding capital projects at the osteopathic school that needed funding. From 2003 to 2006, Bryant directed changes in the state budget to benefit the medical school, including an allocation of $2.325 million for the osteopathic school, the indictment said.

UMDNJ has become one of the most graphic examples of mismanagement of an academic medical institution. The case is also one of the most striking examples of the "anechoic effect." I have never found any reference to the troubles at UMDNJ in any article in a scholarly medical or health care, policy, or services research journal.

Failure to even talk about cases of bad or corrupt managment of health care institutions leaves us far from a solution to the problem.

Some Days You Can't Win: Lawyers in Fen-Phen Case Found to Have Defrauded Injured Patients

In "Pharma Goes to the Laundry," Carl Elliott described Wyeth's marketing campaign for fenfluramine, the fen in the diet drug combination fen-phen. It included a stealth marketing effort, including strategically placed ghost-written articles on behalf of obesity as a public health problem. When reports of heart valve damage afflicting patients on fen-phen began to come out, the company allegedly tried to conceal the evidence it had supporting a causative role for the drug combination. [Elliot C. Pharma goes to the laundry. Hasting Center Report 2004: 34: 18-23, link here.] (See our post here.)

A few days ago, the New York Times reported how patients who developed valvular heart disease after taking fen-phen allegedly were then ripped off by their own lawyers.

W. L. Carter knew there was something fishy going on when he went to his lawyers’ office a few years ago to pick up his settlement check for the heart damage he had sustained from taking the diet drug combination fen-phen.

The check was, for starters, much smaller than he had expected. And his own lawyers threatened to retaliate against him if he ever told anyone, including his family, how much he had been paid. 'You will be fined $100,000, you will go to jail and you will be sued,' Mr. Carter recalled them saying.

Mr. Carter was right to have been suspicious. The lawyers defrauded their clients, a state judge has ruled in a civil case, when they settled fen-phen lawsuits on behalf of 440 of them for $200 million but kept the bulk of the money for themselves. Legal experts said the fraud might be one of the biggest and most brazen in legal history.

When the clients sued the drug maker, they agreed to pay the lawyers 30 percent to 33 percent of any money that was recovered, plus expenses. In this case, that would have left the 440 clients to divide perhaps $135 million.

But the clients received only $74 million. An additional $20 million went to a questionable 'charitable fund.' The rest — $106 million — went to lawyers. Though amounts of the individual settlements remain sealed, court papers suggest they were from $100,000 to $5 million. On average, plaintiffs received less than 40 percent of what the settlement agreement specified, instead of the roughly 70 percent to which they were entitled

At a hearing in 2002 ... the original judge in the case said ... [the lawyers] deserved the higher compensation 'for their services and for the incredible risks they took' and for 'the administrative headaches that came with that.'

But the judge who made that statement and who approved the settlement, Joseph F. Bamberger, received a financial benefit from the windfall. After retiring from the bench in 2004, Judge Bamberger became a director of the $20 million charity for a $5,000 monthly fee. He has since repaid what he received.

Judge Bamberger was reprimanded last year by the Judicial Conduct Commission in Kentucky. The commission said his actions were disturbing, inexcusable and shocking to the conscience.

Judge Bamberger acknowledged to the commission that he had approved fees and expenses of what he understood to be about 49 percent of the settlement but said he had not known about the contracts calling for payment of only 30 to 33 percent. He declined to comment for this article.

In August, the Kentucky Supreme Court suspended the three lawyers, finding that there was probable cause that they had misappropriated their clients’ money.

Some days, you just can't win. There seem to be two morals to this story. First, stealth marketing of and concealment of data about pharmaceuticals can have a cascade of bad effects on patients. Second, trying to solve such problems retrospectively through civil litigation can have its own bad effects. Instead, we need to better assure the honesty of clinical research data about and the marketing of pharmaceuticals (and devices) from the beginning.

Physicians need to be better watch-dogs in this regard on behalf of their patients.

"Drug Crazy"

Every time the issue of conflicts of interest affecting the US Food and Drug Administration (FDA) comes up, one is sure to see at least one opinion piece decrying how excess concern with such conflicts will stifle innovation and keep wonder drugs off the market. There seems to be a whole raft of economists, lawyers, and policy-wonks out there who believe that any slowdown in drug approvals or any excess concern about drug side-effects will lead to unmitigated disaster.

Recently, the FDA announced it would restrict physicians and scientists with major conflicts of interest from participating on its advisory boards. To summarize quickly (with quotes from a Washington Post article),

The biggest change bars anyone from serving on a committee who has a financial interest of $50,000 or more that could have an impact on the drug, device or other issue the committee is considering. Overriding this rule would require a special waiver. If such a waiver is granted, that person could attend meetings, consult and express his views, but could not vote.

In addition, anyone with a conflicting financial interest of less than $50,000 could sit on an advisory committee, but could not vote. There will be a 60-day comment period before the proposals take effect.

"The limit would cover financial interests over the proceeding 12 months and cover, for example, stock and consulting fees," [said an Agency spokesperson.]

See discussion of these changes on GoozNews and the links from PharmaGossip. I could easily argue that allowing people who get up to $50,000 a year from a drug company to sit on an advisory board would given undue influence to people who are paid substantial money by those with vested interests in having the board advise in a certain way.

Nonetheless, soon after these new rules were announced a commentary appeared in the Wall Street Journal aptly entitled "Drug Crazy," by Richard A Epstein, a law professor at the University of Chicago, which practically warned the sky would fall if people with large conflicts of interest are kept off FDA advisory boards. Here are some choice quotes.

The main justification for this new regime is the widespread perception that drug and device makers have "hijacked" the FDA process, allowing dangerous drugs to slip into the market. The most conspicuous illustration involves the various COX-2 inhibitors such as Vioxx and Bextra....

The common perception is that the FDA acted too late in removing these drugs from the marketplace, and indeed should never have approved them at all. That perception rests on a crucial tradeoff: how much of an increased risk of heart attack should people be allowed to run in order to mitigate the ravages of arthritis and other degenerative diseases.

'Suffering boomers want to fill Vioxx void' is a headline in last Friday's Chicago Tribune. The gist of the story: Baby boomers and others have returned to Pfizer's Celebrex, which reported an 18% increase in sales notwithstanding the FDA's stringent black box warning. Similarly, many individuals stashed away their Vioxx for a rainy day after it was recalled by Merck. These individuals understand the risk they're running, but trust their physicians to minimize its impact.

This evidence should put the FDA's zeal in a new light. Just how do these advisory committees 'protect' informed product users by limiting their choices for dealing with crippling chronic conditions?

The FDA's major problem is not laxity, but zealotry. Its current get-tough view on conflict of interest only aggravates the fundamental flaw in its institutional design. Transfixed on the harms drugs can cause, the FDA remains largely oblivious to the harms they can prevent. Any delay in the use of a successful drug is costly: The delay matters little to the FDA, but a great deal to the thousands who plea for compassionate exemptions to try a drug that has not met with FDA approval.

The current get-tough policy on conflicts of interest only magnifies these costly FDA biases. The agency rules cut out the persons who know most about the drugs, and who could well counter unsound objections by critical committee members. But keeping these experts off the committees also skews the deliberative process in a more subtle and powerful way.

Anyone who consults for drug companies is likely to come with the presumption that new drugs may well fill important therapeutic voids. Once these individuals, as a class, are kept off advisory committees, the remaining drug experts are more likely to have the populist views held by the likes of a Marcia Angell or Sidney Wolfe, who suspiciously view most new drugs as insignificant advances over prior treatments. I tremble at the thought that these "untainted" experts will markedly slow down the FDA approval process. This would be bad news for the tens of millions who suffer from arthritis, and the countless individuals who suffer from other conditions.

Right now, we all have a simple expedient to protect ourselves against dangerous drugs that make it to the market: Don't take them. But we have no protection at all when the FDA denies us that choice in the first place. Right now the pace of drug approval is too slow. We don't need the FDA to slow it up still further.

My response is, to be polite, oh, balderdash. Prof Epstein mainly succeeded in revealing his lack of knowledge about drugs and clinical epidemiology. Let me address his main points.

Did Taking Rofecoxib Off the Market Deprive Patients of a Uniquely Effective Drug?

His first major point is that removing Cox-2 inhibitors from the market deprives arthritis sufferers of some magically effective treatment.

In fact, even the clinical trials supported by Merck failed to show that Vioxx (rofecoxib) was any better at relieving pain or other arthritis symptoms than older, cheaper non-steroidal anti-inflammatory drugs (NSAIDs) like ibuprofen and naproxen. See:
Day R, Morrison B, Luza A et al. A randomized trial of the efficacy and tolerability of the COX-2 inhibitor rofecoxib vs ibuprofen in patients with osteoarthritis. Arch Intern Med 2000; 160: 1781-1787. (link here)
Lisse JR, Perlman M, Johannsson G et al. Gastrointestinal tolerability and effectiveness of rofecoxib versus naproxen in the treatment of osteoarthritis: a randomized controlled trial. Ann Intern Med 2003; 139: 539-546. (link here)

To quote the latter study, "in terms of osteoarthritis efficacy, no statistically significant difference in PGADS scores was observed between the rofecoxib and naproxen groups over 12 weeks.... Improvement in AUSCAN scores was not statistically signifcantly different between the rofecoxib and naproxen groups." So even the authors of a Merck supported study were not claiming that Vioxx offered any more pain or symptom relief than did naproxen.

It is possible that for a few patients a Cox-2 inhibitor offers better symptom relief than a NSAID. But there is no evidence of any wide-spread or major advantages. The notion that Cox-2 inhibitors are better pain or symptom relievers seems to be an urban myth. And Counselor Epstein seems to have bought into this myth.

In fact, the only clear advantage of rofecoxib seemed to be that it lead to a slightly smaller risk of upper gastrointestinal (GI) problems than did traditional NSAIDs. For example, one study showed that the risk of upper GI bleeding was 1.3%/year for rofecoxib vs 1.8%/year for various NSAIDs. But even that is a small advantage. One would have to treat 200 patients with rofecoxib to avoid one such a bleed. See:
Langman MJ, Jensen DM, Watson DJ et al. Adverse upper gastrointestinal effects of rofecoxib compared with NSAIDs. JAMA 1999; 282: 1929-1933. (link here)

Are the Risks of Drugs Well-Known, and Can be Easily Avoided by Not Taking Them?

Prof Epstein asserted that it is easy to avoid drug adverse effects. This might be true when these effects are well-known. But the whole point of the Vioxx case was that the adverse effects of rofecoxib were not well-known, and there were allegations that the adverse effects were concealed while the drug was vigorously promoted to a wide-spectrum of patients who were not at particular risk of GI side-effects, and could have been satisfactorily treated with other drugs. (See some relevant posts here, here, here and here.)

Do Conflicted Board Members Provide Needed Opposition to "Populists"?

The notion that without board members who are investors in or paid by pharmaceutical companies, boards will be lead by "populists" who "view most new drugs as insignificant advances over prior treatments." Underlying this is the unstated assumption that many drugs offer significant advances over prior treatments. This is why Prof Epstein "trembled" at the thought of any slow-down in drug approvals.

As a physician, I wish that most new drugs were major advances over existing treatments. But my knowledge of evidence-based medicine suggests that they aren't. Unfortunately, most new drugs (and most new treatments) offer at best only small incremental improvements over other relevant options. And some are simply "me-too" efforts that really offer the most inconsequential advantages.

For example, see the data presented on Vioxx (rofecoxib) above. Clinical research never showed that this drug was a much better pain or symptom reliever than old-fashioned NSAIDs. At best, it lead to slightly fewer gastrointestinal side effects. But we now know that these were traded for increased risk of adverse cardiovascular effects.

In summary, I would suggest that lawyers and economists who write about drugs ought to look at the relevant clinical research before composing their first sentences. Maybe that would give them a more realistic idea of what new drugs and other health care products really are innovations, and what their downsides might be.

By the way, the author of the article, Richard Epstein, did disclose that he has "consulted frequently with pharmaceutical companies." Maybe employment by these companies influenced him to be less than skeptical about the benefits and harms of their products.

Thinking Blogger Award

Health Care Renewal has now been nominated for a Thinking Blogger Award three times, from PharmaGossip, Clinical Psychology and Psychiatry, and Seroxat Sufferers. Thanks to all for the honor!

In return, we are expected to nominate five more blogs that have not yet received the award.

I do have to note that many of our favorite blogs have already been cited. But there are more who are deserving. So I nominate, in alphabetical order:

DB's Medical Rants

MedPundit

Two of the first general medical blogs, with lots of interesting commentary about the real world of medicine

GoozNews

Lots of interesting health care/ policy posts, with emphasis on conflicts of interest problems

Running a Hospital

Truly unique - a hospital CEO who tells it like it is

The Torch

FIRE's in-house multi-author blog on academic freedom, due process for students and faculty, freedom of conscience, etc

WellPoint Fined $1 Million for Canceling Individual Insurance Policies in California

The Los Angeles Times just reported,

Blue Cross of California 'routinely' violated state law when it canceled individual health insurance coverage after policyholders got pregnant or sick, making no attempt to determine whether they did anything to merit such "harsh" treatment, according to a state investigation of practices that appear to be industrywide.

As a result of its unprecedented investigation, the Department of Managed Health Care on Thursday said that it had fined Blue Cross $1 million — an amount immediately criticized by canceled policyholders and consumer advocates as too small to matter to an insurer whose parent company, WellPoint Inc., earned $3.1 billion in profit last year on revenue of $57 billion.

Indianapolis-based WellPoint disputed the findings, saying it acted legally and that some rescissions are necessary to combat fraud.

The state investigation found that Blue Cross used computer programs and a dedicated department to systematically investigate and cancel the policies of pregnant women and the chronically ill regardless of whether they intentionally lied on their applications to cover up preexisting medical conditions — a standard required by state law for canceling individual policies.

Regulators examined 90 randomly selected cases of policy cancellations — out of about 1,000 a year in California — and found violations in each one.

'This looks like 'Rescission Inc.,' ' said Bryan Liang, director of the Institute of Health Law Studies at California Western School of Law in San Diego. 'It's clear if 100% of these individuals had their policies illegally pulled, that means that there's a problem. These are just the tip of the iceberg.'

What sort of insurance is it when the policy can be cancelled as soon as its holder makes a large claim, on the pretext that in retrospect something the policy-holder wrote on a complicated and hard to interpret application form was wrong?

Note that we most recently wrote about charges that the California Blue Cross unit of WellPoint was cancelling policies in this manner here.

Note also that this is the same WellPoint whose New York Empire Blue Cross and Blue Shield subsidiary recently misplaced a computer disc containing confidential information on 75,000 policy-holders (see story here).

Furthermore, this is the same WellPoint which settled a RICO (racketeer influenced corrupt organization) law-suit in California over its alleged systematic attempts to withhold payments from physicians (see story here).

Finally, this is the same WellPoint whose retiring CEO earned more than $8.5 million in total compensation in 2005, and will be receiving a lump sum retirement payment of $31 million when he steps down (see story here).

Yet WellPoint advertises its "commitments" thusly,

At WellPoint, we are dedicated to improving the lives of the people we serve and the health of our communities. From the boardroom to the mailroom, every associate is expected to honor the company's commitments to our diverse customers, fellow associates, shareholders and the communities we serve - helping us become the most trusted choice among consumers.

Our business strategies mirror our commitment to providing affordable quality care to our members and the public. In line with our vision to become the most valued company in our industry, we must:

* Bring affordable quality health care and coverage to medically underserved communities
* Educate people to take an active role in their own health
* Work with our health care partners to improve quality of care
* Help shape public policy that makes health care more affordable and more accessible

Say what? WellPoint is a for-profit company. Its first obligation is supposed to be to make money for its share-holders. I won't comment on how successful it has been in that regard. It certainly has been successful in putting money in the pockets of its out-going CEO.

But how does a "commitment" to provide "affordable quality health care" square with cancelling individual subscribers who actually need to the insurance to pay medical bills? How does a "commitment" to "work with our health care partners to improve quality of care" lead to settling a RICO law-suit about withholding physicians' reimbursement?

It's funny how for-profit managed care organizations warm and fuzzy statements of purpose seem to contrast with how they operate in real life (see also the case of UnitedHealth's recent advertising here).

Maybe soon they will be retailing bridges across the East River in New York.

Other Bloggers Shed Light on Important Cases.

A number of important and interesting stories have lately been perspicaciously covered by some other bloggers. I think we are starting to demonstrate that blogging can help spread the word about important cases of health care mismanagement, conflicts of interest, and malfeasance, and of cases of attempts to promote pseudoevidence by deception and intimidation, the sorts of cases which used to only get local coverage. "Sunlight is the best disinfectant."

On PharmaGossip, the latest pharmaceutical marketing bomb-shell, pharmaceutical representatives moon-lighting in beauty pageants. This is a useful link to look at the next time someone in pharmaceutical marketing argues that drug detailing is all about presenting physicians with the most relevant evidence in a sober and scientific manner.

On the Clinical Psychology and Psychiatry Blog, how a pharmaceutical company tried to deal with a scientific presentation suggesting one of its products might be more hazardous that was previously thought. The methods contemplated included trying to stop or delay publication of the paper, possibly by exerting "influence" on the editorial board, or article reviewers. This is another nasty reminder about how marketing may trump science, and patient welfare in some health care organizations.

Also on the Clinical Psychology and Psychiatry Blog, how some US state Medicaid programs are using pharmaceutical company subsidiaries to try to control drug utilization, including of that company's products. This appears to be a new variant of hiring the fox to guard the hen-house.

On the [anti-] Scientific Misconduct Blog, a discussion of the ad hominem attacks that have been launched against one of the more important medical whistle-blowers of the last decade, Dr Nancy Olivieri. Such attacks, of course, should not diminish the importance of the case of attempted research suppression that she made public.

FDA Leader Warns Dissent is Not "Helpful"

And speaking of leaders of health care organizations who will not tolerate dissent...

The Associated Press (here via SFGate.com) reported that although Dr Andrew von Eschenbach, the new chief of the US Food and Drug Adminstration (FDA) vowed during a congressional hearing to protect "the legal rights of every single employee within the FDA," he seemed to have a rather harsh view of any FDA employee who might speak out publicly in opposition to the party line.

However, during a June 2006 meeting, von Eschenbach told a group of 30 to 40 employees that anyone who went against the "team" could end up being "traded," according to accounts by agency whistle-blowers, including Dr. David Ross.

During Thursday's hearing, von Eschenbach apologized to Ross, who now works for the Department of Veterans Affairs, if his comments had been misunderstood. The FDA head then told lawmakers he wanted to foster an environment — 'if you will, a locker room' — where people with diverse points of view and different perspectives could debate, vigorously and aggressively, any problems or issues.

Ross said in February that he left the FDA 'rather than be silenced.'

Von Eschenbach went on to add: 'When people don't choose to participate in that and aren't willing to be a part of that and simply express opinions independent of that, I don't think that's helpful to the process.'

Ross told reporters during a break in Thursday's hearing that that qualifying statement 'sends a very unfortunate message.'

Unfortunately, this is all too parallel with how dissent appears to be treated at the CDC (see post here). Again, in my humble, a scientifically-based agency whose task is to protect the health of the public requires the same sort of spirit of free enquiry that is part of the academic mission (but often only honored in the breach on campus). For the leadership of such an agency to regard independent opinios as not "helpful to the precess" is to acknowledge, once again, mission-hostile management.

Note: for the PharmaGossip take on this, go here.

Funny Sorts of Ombudsmen at the CDC

We have previously posted (most recently here) about allegations of mismanagement at the US Centers for Disease Control and Prevention (CDC).

The Atlanta Journal Constitution just reported an unusual exchange between Dr Julie Geberding, the head of the CDC, and US Senator Charles Grassley, the senior Republican on the US Senate Finance Committee. It seems that Senator Grassley requested a briefing from the newly hired CDC ombudsmen, but Dr Geberding refused the request.

In a March 5 letter to Grassley, Geberding said the two contract employees the CDC has hired to serve as interim ombudsmen believe that briefing the senator would violate standards of practice for ombudsmen and render them unable to continue to do their jobs effectively.

'While I am respectful of your desire to get further information, I am also sensitive to these principles — especially because CDC's Ombudsman Office is in a critical stage of development,' Gerberding wrote.

The big problem with that argument is that the ombudsmen already had agreed to brief Geberding.

Grassley's letter questions the validity of the ombudsmen's reasoning, stating that he is neither the subject of the ombudsmen's inquiries 'nor a potential cause of employee angst at CDC.' He notes that the ombudsmen have met and briefed Gerberding. Many employees blame Gerberding and her leadership for problems at the agency.

'Dr. Gerberding, am I missing something here?' Grassley asked in his letter. 'Why would two individuals claim preserving their objectivity as Ombudsmen requires refusing to brief Congress, but allows meeting with you to discuss their findings?' Grassley wrote, adding that he's not surprised that few CDC employees have 'felt comfortable approaching these two men to seek their help on their problems with CDC management.'

In my humble opinion, it's a funny sort of ombudsman who reports to the leader of his or her government agency, but cannot report to Congressional oversight. I would imagine any half-way rational CDC employee would be very hesitant to say anything to the ombudsmen that might be the slightest bit offensive to the leadership of the CDC.

Thus, the CDC still appears to be an agency whose leadership does not easily tolerate criticism. Given the scientific basis of the agency, this would appear to be yet another example of mission-hostile management, US government agency style.

But it seems that in many kinds of health care organizations, not just in the US, not just government agencies, the worst sin is to criticize the management. Given the ineptness, and worse of the management of many health care organizations (some of which has been featured on Health Care Renewal), is it any wonder that health care is in a mess?

More on Financial Entanglements of Physicians and Health Care Academics

We have written extensively about physicians' and health care leaders' financial entanglements with other health care organizations. This week, several important articles providing new insights into this problem appeared.

First, the Journal of the American Medical Association, (JAMA) published an article about pharmaceutical payments to physicians in two states. [Ross JS, Lackner JE, Lurie P et al. Pharmaceutical company payments to physicians: early experience with disclosure laws in Vermont and Minnesota. JAMA 2007; 297: 1216-1223. ] Vermont and Minnesota, as well as several other states, have laws in place requiring pharmaceutical companies to report payments made to physicians for a variety of purposes, and the information from these reports is supposed to be made public.

The main lesson from this study was that problems with the laws and how they were operationalized meant that the data they provided about financial interactions between physicians and the pharmaceutical industry was very incomplete. Ross and colleagues only were able to get access to some of the pharmaceutical companies' reports, and with considerable difficulty. It took considerable negotiation to obtain computerized information from Vermont. Minnesota's records were available, but only in the form of paper forms that the investigators had to laboriously copy. Then they found that considerable data was missing or incomplete. Some companies failed to provide any data during particular years. The Vermont data was linked to specific payment recipients in only a few instances. Finally, it turned out that Vermont allowed companies to withhold information about payments to physicians as "trade secrets."

Even so, what data was available suggested that considerable numbers of physicians have substantial financial interactions with pharmaceutical companies. Based on the Minnesota data, which provided information about individual recipients, 14% of physicians with active medical licenses received payments from pharmaceutical companies of at least $100. Although the median number of payments to individual physicians was one, the range was from 1 to 88. the median amount was $1000, but the range was $100 to $1,178,203.

The JAMA article was accompanied by a commentary [Brennan TA, Mello MA. Sunshine laws and the pharmaceutical industry. JAMA 2007; 297: 1255-1257.] Note that one author, Dr Brennan, is currently a full-time executive with a commercial managed care organization, Aetna Inc. Nonetheless, the commentary provided some important summary points.

What these investigations have found is discouraging. First, numerous payments to physicians exceeded the $100 limit that has been suggested by the American Medical Association. Because this amount was also endorsed by the major pharmaceutical industry trade group, the finding undermines faith in industry self-regulation. Second, and worse, there are many holes in the reporting.

Nonreporting undermines hospitals' and medical societies' own efforts to police conflicts of interest among physicians.

Most importantly, efforts to circumvent the law make the drug companies look silly at best and arrogant at worse. To call small payments to individual physicians 'trade secrets' or offer 'doctor' as the name of a recipient can only create mistrust.

To be clear, for-profit industries do not share the same ethical norms to which physicians and other health care professionals must adhere. Their primary commitment is to create shareholder value, not maintain an altruistic commitment to patients. But at some point the leadership of the pharmaceutical industry and their boards of directors must begin to recognize that growing public and professional mistrust could substantially detract from that value.

Finally, the New York Times did its own analysis of the Minnesota data. It focused on a few academic physician leaders who had substantial financial entanglements with the pharmaceutical and biotechnology industry. First, Dr Allan Collins:

Dr. Allan Collins may be the most influential kidney specialist in the country. He is president of the National Kidney Foundation and director of a government-financed research center on kidney disease.

In 2004, the year he was chosen as president-elect of the kidney foundation, the pharmaceutical company Amgen, which makes the most expensive drugs used in the treatment of kidney disease, underwrote more than $1.9 million worth of research and education programs led by Dr. Collins, according to records examined by The New York Times. In 2005, Amgen paid Dr. Collins at least $25,800, mostly in consulting and speaking fees, the records show.

In an e-mail message, Dr. Collins said he personally received in 2004 less than $10,000 from Amgen for educational presentations. 'The contract amount of $1.9 million from Amgen was paid to the Minneapolis Medical Research Foundation (MMRF) for the research contract, on which I am the designated senior researcher,' Dr. Collins wrote. He wrote that he did not work for or serve on the board of directors of the foundation. Dr. Collins discloses on his Web site and research papers that he is a consultant to Amgen, among other companies.

Dan Whelan, an Amgen spokesman, said the company paid the Minneapolis Medical Research Foundation 'to conduct sophisticated research and data analyses that have enhanced the understanding of health care delivery' for kidney patients.

Then Dr Richard Grimm

This list of top doctors in Minnesota includes Dr. Richard Grimm of the Berman Center for Outcomes and Clinical Research in Minneapolis, who has twice served on government-sponsored hypertension panels that create guidelines about when to prescribe blood pressure pills. Last year, he served on a National Kidney Foundation panel that wrote guidelines about when kidney patients should be given cholesterol pills.

Between 1997 and 2005, Dr. Grimm earned more than $798,000 from drug companies, according to records. In 2003 alone, Pfizer paid Dr. Grimm more than $231,000. Pfizer markets Lipitor, a cholesterol drug that last year had $12.9 billion in sales, more than any other drug in the world. It also markets Norvasc, a hypertension drug that last year had $4.9 billion in sales. Guidelines that suggest greater use of these drugs would be a huge boon to Pfizer.

'Drug companies are like lions,' Dr. Grimm said of his sponsored talks. 'For lions, it’s their nature to kill zebras and eat them. For drug companies, it’s their nature to make money. They’re not really trying to improve anybody’s health except if it makes them money.'

'On your side, you’re making a bit of money, but you’re also trying to educate the doctors. And in my view, the doctors need a lot of educating.'

Finally, Dr Donald Hunninghake:

Dr. Donald Hunninghake served on a government-sponsored advisory panel that wrote guidelines for when people should get cholesterol-lowering pills. The panel’s 2004 recommendations that far more people get the drugs became controversial when it was revealed that eight of nine members had financial ties to drug makers. The full extent of those ties have never been revealed.

In 1998 alone, Pfizer paid Dr. Hunninghake $147,000, and he earned at least $420,800 from drug makers between 1997 and 2003. He left the University of Minnesota in 2004 to become a full-time industry consultant. He is now retired.

'Most of my talks did not relate to drugs but the guidelines for treatment,' Dr Hunninghake said.

The Times article also quoted a number of critics of the financial relationships between drug companies and some doctors and academic medical leaders.

'When honest human beings have a vested stake in seeing the world in a particular way, they’re incapable of objectivity and independence,' said Max H. Bazerman, a professor at Harvard Business School. 'A doctor who represents a pharmaceutical company will tend to see the data in a slightly more positive light and as a result will overprescribe that company’s drugs.'

And,

'The vast majority of the time that we did any sort of paid relationship with a physician, they increased the use of our drug,' said Kathleen Slattery-Moschkau, a former sales representative for Bristol-Myers Squibb and Johnson & Johnson who left the industry in 2002. 'I hate to say it out loud, but it all comes down to ways to manipulate the doctors.'

Jamie Reidy, a drug sales representative for Pfizer Inc. and Eli Lilly & Company who was fired in 2005 after writing a humorous book about his experiences, said drug makers seduced doctors with escalating financial inducements that often start with paid trips to learn about a drug.

'If a doctor says that he got flown to Maui, stayed at the Four Seasons — and it didn’t influence him a bit? Please,' Mr. Reidy said.

The lectures earn doctors more than cash.

'You’re making him money in several ways,' said Gene Carbona, who left Merck as a regional sales manager in 2001. 'You’re paying him for the talk. You’re increasing his referral base so he’s getting more patients. And you’re helping to develop his name. The hope in all this is that a silent quid quo pro is created. I’ve done so much for you, the only thing I need from you is that you write more of my products.'

A few of the doctors who took drug company money admitted it was for marketing purposes.

Drug companies 'want somebody who can manipulate in a very subtle way,' said Dr. Frederick R. Taylor, a headache specialist in Minneapolis who earned more than $710,000 between 1997 and 2005, much of that from GlaxoSmithKline, the maker of the migraine drug Imitrex.

Dr. George Realmuto, a psychiatrist from the University of Minnesota, said most of the marketing associated with his lectures was packaged around his talks.

'It’s at a wonderful restaurant, the atmosphere is very conducive to a positive attitude toward the drug, and everyone is having a good time,' said Dr. Realmuto, who compared the experience to that of buying a car in a glitzy showroom. He earned at least $20,000 between 2002 and 2004 from drug makers.

As the man says, read the (several) whole things.

These articles collectively add to our information about the pervasiveness of conflicts of interest within the health care system.

In summary, physicians or other health care academics who take money from drug (or biotechnology, or device or other health care) companies ought to disclose who paid them, how much, and for what whenever they speak, write, or otherwise attempt to communicate about any subject relevant to the companies' vested interests. Failing to do so means they are participating in deceptive marketing practices.

If disclosure might be uncomfortable, then perhaps that discomfort is saying something about the nature of the relationship created by the payments received.

A better solution might be for individual physicians and health care academic to forego all individual payments from commercial firms with vested interests related to the individuals' clinical and academic work. For this to work, of course, medical schools and academic medical centers would have to stop putting so much pressure on their faculty to bring in external funding, whatever the source, and whatever the ostensible reason, used by the institutions for whatever the purpose.

Meanwhile, physicians and the public need to look very hard to see if what people in academic medicine are saying is based on the their clinical and academic expertise, or their financial relationships with commercial firms with vested interests in having these communications come out a certain way.