Discount Prescription Program Available To Some Locals

Listen up, Hoboken, Newark, and Orange residents.  There’s a new prescription discount program in town: Coast2Coast Rx Card.  Well, the program isn’t all that new to the area: Newark launched it last year and Hoboken launched it in January.  However, I didn’t learn about Coast2Coast Rx Card until I filled a prescription at my local CVS last month.  Since my prescription wasn’t covered by my health insurance (I always joke to the pharmacist that it kind of defeats the purpose of having health insurance, but I never get any laughs), I was bracing myself for the out-of-pocket cost.  So imagine my surprise when the pharmacist said that I owed $35 instead of $50.  When I pointed out the “mistake,” I was handed a Coast2Coast Rx Card.

While it isn’t a substitute for health insurance, the free Card does offer discounts on prescription drugs, laboratory tests, and imaging tests.  Specifically, the Card boasts such features as:

• 59,000+ participating pharmacies including all major chains and most independents
• Over 60,000 drugs included in formulary
• Save up to 65% on a brand name or generic drugs
• Overall annual savings range from 30% to 45%
• Card is good for an entire family
• Cardholder pays no fees for the card
• No paperwork to fill out — card is ready to use
• There are no health, age or income restrictions; everyone qualifies
• Card has no expiration date and can be used as often as needed
• Card can be used to fill pet prescriptions at participating pharmacies
• Card is primarily for uninsured although insureds can use the card if they have a high deductible
• Insureds can use the card if their drug isn’t covered by their insurance
• In some instances the card can be used during the Medicare Part D “donut hole.”
• Cardholder information is held confidential and is not used for any other purpose.
• The card includes 50%-80% discounts on lab and imaging tests

According to The Florida Times-Union, Financial Marketing Concepts, Inc. (FMC), a Florida-based company, issues the Card on behalf of WellDyneRx, a national pharmacy benefit management company.  In the past three years, FMC has secured agreements with 57 cities and counties in Alabama, Arizona, California, Florida, Illinois, Massachusetts, Mississippi, Missouri, New Jersey, New York, Ohio, Pennsylvania, Tennessee, and Texas (which may or may not look something like this.)  These agreements give FMC a small fee for each prescription filled through the program.  FMC in turn passes along a royalty to the city or county.

If you’re like me, you may already be in the habit of calling pharmacies and comparing the cost of prescriptions, regardless of whether or not your health insurance covers them — and it’s surprising how the cost can vary.  So if you live in Hoboken, Newark, or Orange, be sure to check out whether the Card gives you any discounts.  Can’t hurt.

High School Just Says No to Medical Marijuana

Remember the “Just Say No” and D.A.R.E. anti-drug campaigns way back in the day?  I do.  That’s when the high school kids would come to my elementary school, put on a play, and divide us into small groups for a talk on how we shouldn’t use drugs.  I think there was even a song in there somewhere.  Remember those bizarre zero-tolerance policy stories too?  The ones about a middle school student who was suspended for touching and refusing a proffered Adderall pill or a little kid who was suspended for bringing a camping utensil to school and then required to attend an alternative school for 45 days?

So what should parents and teachers do when a high school student may legally take medical marijuana lozenges to treat diaphragmatic and axial myoclonus, a rare condition which causes him to suffer seizures that can last for 24 hours, but may not legally do so when the seizures occur at school?  As The Colorado Independent reports, that’s the question facing a Colorado Springs teenager who needs to take such lozenges for seizures that can happen without warning and a high school that doesn’t want him to have the lozenges on its property.

You see, 15 states - Alaska, Arizona, California, Colorado, Hawaii, Maine, Michigan, Montana, Nevada, New Jersey, New Mexico, Oregon, Rhode Island, Vermont, and Washington — and the District of Columbia have legalized medical marijuana.  Nine states — Connecticut, Delaware, Idaho, Illinois, Maryland, Mississippi, New Hampshire, New York, and Oklahoma — have similar legislation pending.  In November 2000, 54% of Colorado voters approved the legalization of medical marijuana through Ballot Amendment 20.  The law went into effect on June 1, 2001.  (Nine years later, Governor Bill Ritter signed House Bill 1284 and Senate Bill 109 into law, providing a regulatory framework for dispensaries and addressing potential fraud and abuse.)

The Colorado Department of Public Health and Environment (CDPHE) maintains the Medical Marijuana Registry program which accepts and processes applications for Registry Identification cards.  The registration process is fairly straightforward.  Under 5 CCR 1006-2, an adult patient/applicant (over the age of 18) must submit a notarized application which includes name, address, date of birth, Social Security number, name and address of primary-care giver (if applicable), written documentation from the applicant’s physician confirming his or her debilitating medical condition, name and address of the applicant’s physician, and a copy of an identity document.  For a minor patient/applicant (under the age of 18), a parent residing in Colorado must submit written consent and the applicant’s name, address, date of birth, Social Security number, written documentation from two of the applicant’s physicians confirming his or her debilitating medical condition, the name and address of the two physicians, consent from the applicant’s parents residing in Colorado, and documentation from one of the physicians about the risks/benefits of the medical marijuana treatment.

In June 2010, CDPHE reported that 95,477 Coloradan patients possess valid Registry Identification cards… and only 24 of those patients — a mere 0.0251%  — are minors.  However, if you read the fine print in C.R.S.A. § 25-1.5-106(12)(B)(IV), you’ll note that “[a] patient or primary caregiver shall not: possess medical marijuana or otherwise engage in the use of medical marijuana in or on the grounds of a school or in a school bus.”  What should minors do if they’re still in school and need to take their medicine?

So maybe the Colorado Springs high school isn’t without reason for prohibiting this student from bringing his lozenges onto its property.  It’s an oversight on the part of the legislature to be sure and I wonder if any of the other 23 registered minors have experienced similar problems.  The obvious compromise would be to allow the student to go home and take his medicine as needed — The Colorado Independent reports that he switched schools last year to be closer to home for this very reason — and then return to school.  Yet until this past week the school told the student that this wasn’t an option.  Besides, it’s not a wholly satisfactory compromise if the student has to walk home while having a seizure.

Pharma Coupons: Enriching the Drug Companies

A recent New York Times article highlighted an increasing trend in pharmaceutical consumerism.  Many drug companies are providing copayment or coinsurance payment assistance.  These subsidies now exist “for about half of the top 100 brand-name drugs sold in this country,” according to health analyst Richard Evans of Sector & Sovereign Research.  Some patients receive copayment cards or coupons from their physicians while others find them on the internet.

So what’s the big deal?  Insurance companies use cost sharing to encourage patient selection of less-costly therapeutic options.  Pricing differences influence consumer choices; The American Journal of Managed Care reported in 2005 that most studies of cost sharing and prescription purchasing estimate that a 10% increase in price would decrease consumer use by 1-4%.  As NPR reported, “[t]he copay strategy worked so well that in 2003, more than half of all drugs picked up at pharmacies were generics.”

In mid-2006, pharmaceutical companies introduced coupons to reduce beneficiaries’ out-of-pocket costs for expensive drugs.  The “pharmaceutical subsidies” act as a counter-incentive, steering patients toward more expensive drugs–which wind up costing the consumer less– or zero–out-of-pocket.  As a result, the use of pharmaceutical copayment cards or coupons has tripled since their inception.

Financial Assistance or Greedy Marketing?

According to the NY Times, “[d]rug companies say the [copayment assistance] plans help some patients afford medicines that they otherwise could not.”  However, this seemingly altruistic explanation rings–shall we say– like something less than the entire truth.  For starters, these coupons are widely available on the internet and physicians who distribute the cards do not screen patients for financial need.  As the NYTimes reports,

Executives at Medicis, the company that sells Solodyn, have told investors that the co-payment card is used by an “overwhelming majority” of patients, and is largely responsible for doubling use of the drug, to 26,000 prescriptions a week.

That sounds like brilliant marketing, not need-based financial assistance.

Also, when we think of those who are most in need, we often think (rightly or wrongly) of the uninsured, the poor and the elderly — none of whom benefit from the pharmaceutical subsidy!  As the Amgen First Step Program website states, it is “a medical benefit co-pay coupon program to help commercially insured eligible patients with their deductible, co-insurance, and/or co-pay requirements” for listed drugs.  Excluded from the program are the uninsured or those in publicly funded health insurance plans.

It is unsurprising that the uninsured are excluded from participation.  According to Joshua Schimmer, a biotechnology analyst, “it seems the best strategy for a pharmaceutical company is to price their drug as high as they possibly can and offer that co-pay assistance broadly.”  For example, over the past five years, Jazz Pharmaceuticals has quadrupled the price of its narcolepsy drug Xyrem, while increasing copayment assistance to a maximum $1,200 a month.  In order for the pricing system to work, pharmaceutical companies rely on consumers to choose the subsidized drug and insurers to foot the increased bill.

It is likewise unsurprising that the publicly insured are excluded, but for a very different reason; to offer subsidies to Medicare or Medicaid patients would be illegal.  Under 42 U.S.C. § 1320a-7b (1),(2), the knowing and willful offer, payment, or receipt of any remuneration in return for the purchase of any good “for which payment may be made in whole or in part under a Federal health care program” is a felony punishable by up to $25,000 or five years imprisonment.  Illegal remuneration includes “waiver of coinsurance and deductible amounts (or any part thereof)…”  (§ 1320a-7a (i)(6)).

So What’s the Big Deal?

The pharmaceutical copay cards and coupons are a big problem.  First, they circumvent the cost sharing structures established by health insurance plans, raising systemic health costs.  As the NYTimes reported:

“The member is somewhat insulated from the cost of the prescription,” said Kevin Slavik, senior director of pharmacy at the Health Care Service Corporation, which runs Blue Cross and Blue Shield plans in Illinois and three other states. “In essence, it drives up the total cost of providing the prescription benefit.”

That increased cost is passed on to the privately insured in the form of increased premiums and to the public through increased taxes.  As Eileen Wood, vice president of the Capital District Physicians’ Health Plan, told NPR in 2009:

those coupons come with a consequence. If everyone started using coupons to get the more expensive drugs, “we’d have to raise premiums,” she says. “There’s no question about that.”

Furthermore, publicly funded plans must also pay the increased price of prescription drug benefit, which is passed on to taxpayers.  Any benefit to the coupon user in the form of reduced out-of-pocket expenses is diminished by higher premiums and taxes.  In the final analysis, the only real beneficiaries of these “pharmaceutical subsidies” are the drug companies who offer them.

Moving Forward

This issue is not one that is likely to disappear.  Currently, Massachusetts is the only state that does not allow pharmaceutical coupons; it is possible that other states or the federal government will follow suit.  As for insurers, some may begin requiring patients to try generic drugs first, as Capital District Physicians’ Health Plan has, or simply drop coverage of these drugs altogether.  Either way, drug company coupons will remain a topic to watch in 2011.

Mefloquine at GTMO Interview by Leonard Lopate on NPR’s WNYC

A little while back, we wrote about a report, Drug Abuse: An Exploration of the Government Use of Mefloquine at Guantánamo, issued by Seton Hall Law’s Center for Policy & Research. Renowned for its series of Guantánamo Reports, the Center’s most recent report documents the medically inappropriate use of a dangerous pharmacological treatment on detainees.

According to the report, the U.S. military routinely administered mefloquine, a controversial malaria treatment, at five times the standard prophylactic dose. Mefloquine, even at the standard dose, is known to cause adverse side effects such as paranoia, hallucinations, aggression, psychotic behavior, memory impairment, convulsions, suicidal ideation and possibly suicide.

Today, Professor Mark P. Denbeaux, Director of the Seton Hall Law Center for Policy and Research, was interviewed about the report on NPR’s New York City station, WNYC, by Leonard Lopate. You can listen to the interview here

An Ounce of Prevention: Coverage Battles Rage Over the Biologic Synagis

Yesterday, I got a note from my son’s kindergarten teacher alerting me that the class had run out of hand sanitizer and tissues and needed donations to replenish their supply.  Proof positive that cold and flu season is upon us.

Less commonly known is that, in most or all of the country, it is also respiratory syncytial virus (RSV) season.  RSV is a widespread respiratory virus; almost everyone gets it by the time they turn two and it doesn’t usually result in anything more than a common cold.  As the CDC explains, however, RSV can cause lower respiratory infections such as bronchiolitis and pneumonia and these can be severe.  The virus is the number one cause of hospitalization in babies under one in the United States.

While there is no RSV vaccine, the biologic Synagis (palivizumab) can help prevent the development of severe illness in high risk children.  According to the American Academy of Pediatrics’ influential Red Book, this includes children under two with chronic lung disease, babies under one born at 28 weeks gestation or earlier, babies under six months born at 29-32 weeks gestation, and babies under six months born at 32-35 weeks with at least one of a number of enumerated risk factors such as daycare attendance.

There is a catch.  Synagis costs $900 or more per injection and each injection lasts just one month.  Because a season’s worth of protection from RSV costs many thousands of dollars (one payor puts it at $7,030 per patient), it is perhaps unsurprising that there is ample anecdotal evidence of baseless denials of coverage, by both private insurance companies and Medicaid.  The law student who blogs at Nonsense and Frippery has written three searing posts about her family’s Herculean efforts to secure Synagis shots — first from her private insurance company and then from Medicaid — for her son who was born at 25 weeks gestation in April 2010.  (The posts (which contain some strong language) are here, here, and here.)

With the passage of health reform, the United States has, for the first time, an abbreviated approval pathway for biologic drugs that are “biosimilar” to or “interchangeable” with already-approved biologics.  Its passage creates hope that less expensive versions of at least some biologics will be available here at some point in the future.  As the FDA concedes, however, there are many “issues and challenges associated with the implementation of the Biologics Price Competition and Innovation Act of 2009.”  Monoclonal antibodies like Synagis are likely to prove particularly challenging, for industry and regulators, because they are immensely complex molecules.  In Europe, where there has been an abbreviated approval pathway for biologics since 2004, the European Medicines Agency has yet to approve a biosimilar “mAb”.  This is expected to change, though.  In November, the EMA released a draft guideline for biosimilar “mAbs” and generic versions of rituximab, a drug used to treat non-Hodgkin’s lymphoma and rheumatoid arthritis, are in development.

While biosimilars may someday provide some relief to payors, in the meantime, one may merely seek to hold those payors accountable for baseless denials of Synagis and other expensive, but cost-effective, medicines that they purport to cover.

New Jersey’s Long-Awaited (and Controversial) Proposed Medicinal Marijuana Program Rules

Last week, New Jersey’s Department of Health and Senior Services released long-awaited proposed regulations implementing The Compassionate Use Medicinal Marijuana Act and they have already proved controversial.  Generating the most debate is the Department’s determination that the entities authorized to grow marijuana will not be authorized to dispense it to patients and vice versa.  As the Department explained in a press release, “[s]ix Alternative Treatment Centers (ATCs) will be selected through a competitive process.  Two of the ATCs will be cultivators and four will be dispensaries. … The ATCs selected for dispensing medicinal marijuana will also have the ability to apply to the Department for satellite locations in their region.”

According to the New Jersey Law Journal, Assemblyman Reed Gusciora (D-Mercer), one of the Act’s primary sponsors, called the regulations “a departure from the legislative intent” to authorize six ATCs — two each in northern, central, and southern New Jersey — all of which would both grow and dispense medical marijuana.  Senator Nicholas Scutari (D-Union), another primary sponsor, agrees, arguing that: “the regulations are a problem.  I’m not happy because they do not comport with the statute.  It’s insulting and agitating.”  The Law Journal reports that “Scutari and Gusciora say they will try to persuade [DHSS Commissioner Poonam] Alaigh to change the regulations to conform to the statute.  ‘You can’t change a statute through the regulatory process,’ says Scutari, adding that he will pursue changes through litigation if the rules are not amended to the Legislature’s satisfaction.”

A careful reading of the Act reveals that the provision addressing the function of ATCs is less than crystal clear, however:

“An alternative treatment center shall be authorized to acquire a reasonable initial and ongoing inventory, as determined by the department, of marijuana seeds or seedlings and paraphernalia, possess, cultivate, grow, harvest, process, display, manufacture, deliver, transfer, transport, distribute, supply, sell, or dispense marijuana, or related supplies to qualifying patients or their primary caregivers[.]”

The Department obviously reads this in the disjunctive, to mean that ATCs shall be authorized to do (at least) one of the things listed, but need not be authorized to do all of them.  This reading is supported by the “or” between “sell” and “dispense.”  On the other hand, reading the sentence in the disjunctive allows for absurd results that clearly would thwart the Legislature’s intent.   (For example, under this reading, the Department would be within its rights to authorize six ATCs to grow marijuana but none to dispense it.)

Leaving further statutory analysis to others, I will say that I do not think that the Department’s decision to separate growing and dispensing will necessarily thwart the Legislature’s directive that there be “a sufficient number of alternative treatment centers throughout the State, pursuant to need, including at least two each in the northern, central, and southern regions of the State,” particularly given that the regulations provide for both home delivery and the possibility of satellite ATC locations.  More likely to limit access is the expense to patients, both of participating in the program ($200 for the patient, unless they qualify for Medicaid or other assistance programs, and another $200 if the patient needs a caregiver to assist with their marijuana use) and of paying for medical marijuana, which of course is not covered by any insurance plan.  The proposed regulations provide that prospective ATCs will be judged based on a number of criteria, including “ability to meet overall health needs of qualified patients”; within that rubric, the selection committee should consider prospective ATCs’ plans to make medical marijuana affordable to those who need it.

HHS OIG Notifies Drug Manufacturers of New Enforcement Initiative for Price Reporting Requirements

On September 28, the Office of the Inspector General (”OIG”) released a Special Advisory Bulletin regarding a new enforcement initiative regarding the timely submission of certain pharmaceutical data.  Manufacturers will face civil money penalties (CMP) for failing to comply with reporting requirements.

The Center for Medicare & Medicaid Services (”CMS”) relies on the timely reporting of average manufacturer prices (”AMPs”) and average sales prices (”ASPs”) for the implementation of four different programs: the Medicaid Drug Rebate Program, the 340B Drug Pricing Program (340B Program), the Federal Upper Limit (FUL) Program, and the Medicare Part B outpatient prescription drug benefit.

Under the Medicaid Drug Rebate Program, CMS uses AMPs to calculate the rebates owed to state Medicaid programs.  The 340B Program, which requires manufacturers to sell their prescription drugs to certain safety net health care providers at or below specified prices, also uses AMPs to establish price ceilings.  Medicaid’s FUL Program uses AMPs to act as a prudent buyer of multiple-source drugs.  Finally, the Medicare Part B outpatient drug benefit relies on ASPs to establish Part-B covered drug and biologic payment amounts.

Timely and accurate price reporting is important to the effective and efficient administration of the Medicaid Drug Rebate Program, the 340B Program, the FUL Program, and the Medicare Part B drug benefit.   Manufactures are required to report and certify timely and accurate drug pricing information, including AMPs on a monthly and quarterly basis and ASPs on a quarterly basis.

However, multiple reviews of historical reporting by OIG have demonstrated that voluntary compliance has not been fully effective.  For instance:

• The February 2008 report, “Average Sales Prices: Manufacturer Reporting and CMS Oversight,” found that, “between 41 and 52 percent of manufacturers provided ASPs after the statutorily defined due date.”
• The OIG report, “Drug Manufacturers’ Noncompliance With Average Manufacturer Price Reporting Requirements,” released the same day as the Special Advisory Bulletin, determined that during 2008:
  • 53 percent of the 592 manufacturers that were required to submit quarterly AMP reports failed to provide pricing data by the statutorily defined due date.
  • 78 percent of the 579 manufacturers that were required to submit monthly AMP reports failed to provide pricing data by the statutorily defined due date.

Moving forward, OIG will work with CMS to “identify and penalize noncompliant manufacturers through the CMP process.”  Upon a report from CMS that a manufacturer has not submitted a timely report of product pricing information, OIG will exert its authority to impose CMPs of $10,000 per day upon the manufacturer in an effort to improve compliance.

Podcast: Gibbons Institute Hosts Panel on Pay for Delay in Hatch-Waxman Patent Litigation

Seton Hall Law’s Gibbons Institute of Law, Science & Technology and the New Jersey Intellectual Property Law Association presented a panel discussion entitled, “Pay for Delay: Views from the FTC, Industry and Legal Economists on Reverse Payment Settlements in Hatch-Waxman Patent Litigation.”

The pay for delay debate essentially rests on two competing public interests: scientific innovation and access to medicines.  Reverse settlements, which are sometimes referred to as “pay for delay,” involve the practice of name-brand pharmaceutical companies paying would-be generic competitors to delay the entry into the market of a particular generic drug. The Federal Trade Commission and the Department of Justice decry the practice because they claim it results in higher prices for consumers who do not have access to cheaper generics. Many in the brand-name pharmaceutical industry defend the practice because, they argue, extending the patent exclusivity period of an innovator drug better allows innovator companies to improve their return on investment and thus underwrite further research and innovation.

Panelists included Michael Kades, Attorney Advisor, Federal Trade Commission; Charles A. Gallia, Counsel, Gibbons P.C.; Anastasia Winslow, Assistant General Counsel, Bristol-Myers Squibb; and David Opderbeck, Associate Professor of Law and Director, Gibbons Institute of Law, Science & Technology. You can listen to their discussion here.

Hatch-Waxman “Pay for Delay Audio

Trouble Brewing for Pharmaceutical Companies

Bribery and recalls.  Federal agencies are turning up the heat on pharmaceutical companies.  Were you surprised by the eight recalls of Johnson & Johnson products this year?  Maybe you shouldn’t be.  As HealthReformWatch.com reported in We May Need More Than a Spoonful of Sugar to Help Our Medicine Go Down, drug recalls reached a record high 1,742 in 2009 — more than four times the amount in 2008.  Bowman Cox, managing editor of the Gold Sheet (which first broke the story) told CNN Money that in light of the 296 recalls issued in the first six months of 2010, there could be 600 or more recalls this year.

Why So Many Recalls?

Analysts and legislators are examining the recall statistics to find sources and solutions to the pharmaceutical safety issue.

1.   Drug repackaging

Advantage Dose, a now-defunct Shreveport, LA based drug repackager, was responsible for more than 1,000 of the 2009 recalls. Companies like Advantage Dose repackage and relabel drugs into smaller units for resale or distribution to health care facilities. After excluding Advantage Dose from the count, there still remains a 50% jump in recalls from 2008 to 2009.

2.   The generic rush

Gold Sheet’s Cox suggests that generic manufacturers cut drug design costs in their rush to be first to market after a branded-drug’s patent protection expires, decreasing quality.  “The first applicant typically gets the lion’s share of the business for the new drug… So they get the application. They make and market the drug, but they could still have problems down the road if they haven’t really understood the optimum way to make that drug.”  One example of a design failure is Caraco Pharmaceutical Laboratories’ “tablet thickness” recalls in March 2009.

3.   Manufacturing lapses

Some experts say the biggest culprits include the quality of raw materials and contamination. Approximately one month ago, HealthReformWatch.com reported in Pharmaceutical Outsourcing: Trading Quality for Lower Costs? that India’s largest pharmaceutical manufacturer had been cited several times in recent years for manufacturing violations.  Additional recalls include vaccines produced by Shantha Biotechnics for Sanofi-Aventis and injectible drugs made by Claris Lifesciences for Pfizer.  The FDA stated its intent on May 5, 2010 to “propose stronger regulation for pharmaceutical companies that outsource manufacturing, putting more responsibility on the companies to ensure the purity and safety of the products…”

4.   Increased FDA scrutiny of manufacturing facilities

Which came first, the chicken or the egg?  Increased FDA oversight may or may not have led to the increased number of recalls; however, the recalls will probably lead to increased FDA regulatory power.

As Jennifer Jascoll reported, Senator Michael F. Bennet (D-CO) proposed the Drug Safety and Accountability Act of 2010 on August 3, 2010.  According to Bennet’s press release, “[t]he bill would strengthen manufacturer quality standards, enhance the FDA’s ability to protect Americans through improved tracking of foreign manufacturing sites, and give the FDA much-needed authority to recall potentially dangerous drugs.” Currently, the FDA is empowered to issue warnings and recommend that a manufacturer issue a recall.

Two prior bills would also increase FDA powers to mandate a recall:

• The Protect Consumers Act of 2009 (sponsored by Rep. Betty Sutton, D-OH) would require the Secretary of HHS implement a recall if it is determined to be necessary.
• H.R. 6740 (sponsored by Rep. Edolphus Towns, D-NY) would provide the Secretary of HHS with the ability to mandate a recall “if the Secretary has reason to believe that the use or consumption of, or exposure to, a drug (or an ingredient or component used in any such drug) may cause serious adverse health consequences or death to humans or animals.”

According to CNN Money, the FDA has not identified any alarming pattern.  FDA spokeswoman Elaine Gansz Bobo stated, “[s]ince every recall situation is unique, it would be difficult to assess whether there are any trends or increases in recalls this year… At this time, however, we have not identified any trends.”  Despite the FDA’s lack of concern, other federal agencies are interested in the practices of pharmaceutical companies.

Further Federal Investigations

According to the N.Y.Times, federal prosecutors and securities regulators are investigating pharmaceutical companies for potential violations of the Foreign Corrupt Practices Act (FCPA).   The FCPA is an anti-bribery law which bars companies from offering foreign government officials items of value for profit.  For instance, Pfizer disclosed in April “that it paid $35m over six months to 4,500 doctors in private practice for education and the development and marketing of new drugs.”  Although this practice is legal in the U.S., such payments are illegal in many foreign countries where physicians are employed by the government.

On November 17, 2009, Assistant Attorney General Lanny A. Breuer stated that the Department of Justice intended to focus its attention on the pharmaceutical industry:

In some foreign countries and under certain circumstances, nearly every aspect of the approval, manufacture, import, export, pricing, sale and marketing of a drug product may involve a “foreign official” within the meaning of the FCPA. The depth of government involvement in foreign health systems, combined with fierce industry competition and the closed nature of many public formularies, creates, in our view, a significant risk that corrupt payments will infect the process. Our remarkable FCPA unit and our terrific health care fraud unit will be working together to investigate FCPA violations in the pharmaceutical industry in an effort to maximize our ability to effectively enforce the law in this high-risk area.

“Corrupt practices” under the FCPA are not limited to cash in envelopes.  Inappropriate payments for lavish hospitality, consulting, licensing agreements, and even charitable donations may raise red flags for government investigators.

Could bribery be contributing to decreased quality and the sudden rise in recalls?  According to the Financial Times, the DoJ is focusing its efforts elsewhere:

[T]he DoJ is particularly interested in corrupt payments that may have influenced the reliability or integrity of data in clinical trials performed outside the US. A recent report by the Department of Health and Human Services found 80 percent of marketing applications for drugs approved by the Food and Drug Administration in the US had relied on at least one foreign trial.

It appears that the DoJ’s scrutiny of clinical trials is not without merit.  The N.Y.Times reports that “[l]ast month, a federal drug official reported that he found repeated instances in a landmark clinical trial of Avandia, a controversial diabetes medicine, in which patients taking Avandia appeared to suffer serious heart problems that were not counted in the study’s crucial tally of adverse events.”  The clinical trials for Avandia included many foreign trial sites, which were submitted in support of the drugs’ application to enter and remain on the U.S. market.  GlaxoSmithKline, the trial’s sponsor, has not been accused of fraud.

According to recent regulatory filings, the following companies are under investigation for possible violations of the FCPA:

• Merck is cooperating with a federal investigation of company activities in multiple foreign nations.
• Medtronic is cooperating with investigations of company activities in Greece, Poland, Germany, Turkey, Italy, and Malaysia.
• Eli Lilly is cooperating with the investigations of subsidiaries in several countries, including Poland.
• Federal investigators are looking into improper payments related to the sale of Zimmer products abroad.
• Johnson & Johnson voluntary disclosed the possibility that company subsidiaries abroad had made improper payments to government officials in two countries relating to the sale of medical devices.
• Pfizer and Bristol-Myers Squibb have also disclosed that they are subject to federal investigations. AstraZeneca, GlaxoSmithKline, and Baxter SciClone have also received inquiries from federal enforcement agencies.

We May Need More Than A Spoonful Of Sugar To Help Our Medicine Go Down

Today CNNMoney reports that drug recalls quadrupled from 426 in 2008 to a record 1,742 in 2009.  The recalls have been attributed to “manufacturing lapses” in raw material quality, labeling and packaging, and contamination.  Generic and over-the-counter drugs have been affected the most.  CNNMoney notes that the race to put generic products on the market and the pressure to cut costs have caused drug companies to

sometimes fail to spend enough time learning how best to make the drug….  And since generic and over the counter drugs aren’t as lucrative for drugmakers as prescription drugs, companies may not be investing enough resources to make high-quality, safe products.

One such cost-cutting measure involves outsourcing production to foreign manufacturing sites and this measure seems to have received the most attention.  (Check out fellow blogger Jae W. Joo’s post on outsourcing.)

Earlier this month, Senator Michael Bennet (D-Colorado) introduced the Drug and Safety Accountability Act of 2010 which seeks to ensure the safety and efficacy of drugs sold in America, regardless of their manufacturing location.  The bill would require, among other things, that:

• manufacturers have quality management plans which the FDA can inspect;
• manufacturers maintain supply chain documentation;
• the Secretary of Health and Human Services track facilities manufacturing drugs or active ingredients for the American market; and
• the FDA be given more power to ensure drug safety, including the authority to enact mandatory recalls for batches of drugs that pose risks and to assess civil penalties for violations of the Federal Food, Drug, and Cosmetic Act.

Click here for more details about the bill and here for Sen. Bennet’s own promotion of it.  Sen. Bennet has lamented how:

[f]or too long, the FDA has lacked the proper authority to adequately safeguard our drug supply.  Americans need to be able to trust that the drugs in their medicine cabinets are safe, no matter where they’re made.

A father of three, Sen. Bennet has said that the recent McNeil recall of over-the-counter children’s medicine spurred him into action.

Pharmaceutical Research and Manufacturers of America (PhRMA) Senior Vice President Ken Johnson has issued a statement in response to the bill, saying that:

[t]he lifeline of America’s biopharmaceutical research companies is the safety and integrity of the products they develop.  Brand-name pharmaceutical companies make tremendous investments in quality control systems and take extensive measures to help protect patient safety and to help prevent adulterated ingredients from entering into America’s prescription drug supply.

In addition, drug manufacturing for the U.S. market — regardless of where it occurs — is regulated under Good Manufacturing Practices (GMP) by the Food and Drug Administration (FDA).  These GMP requirements help to assure the safety, quality and purity of drug ingredients that are used in the U.S. prescription drug supply.

The U.S. regulatory system for prescription drugs is the toughest and safest in the world….

Okay.  But other people here don’t think so.  (Click here to read a good opinion by Dr. Lynn Parry, Chair of the Colorado Prescription Project, on why this bill should pass.)

According to a recent Pew Prescription Project poll, less than 10% of Americans feel confident about medications manufactured in India and China.  89% of Americans support Congressional action to introduce new drug safety measures.  How many of those people realize that approximately 80% of the materials used to make or package drugs sold in America comes from foreign sources?  I didn’t, but then, is such high a percentage really that surprising?

Reading through the CNNMoney report, I was reminded a little of a scene from a seventh season episode of Friends:

Phoebe: It’s amazing! My headache is completely gone! What are those pills called?
Monica: Hexadrin.
Phoebe: Oh, I love you, Hexadrin!  Oh look!  It comes with a story!
Monica: No, Phoebe, those are, like, the side effects and stuff.
Phoebe: Say what?
Monica: You know, the possible side effects.
Phoebe: Oh my God!  Dizziness, nervousness, drowsiness, facial swelling, nausea, headache…  Headache! Vomiting, stomach bleeding, liver damage!  Now, okay, I don’t recall any of this coming up when you gave me these little death capsules! Oh, I’m sorry, extra-strength death capsules!

Admittedly, the scene concerns how potential side effects can be worse than the problem being treated (and that’s a whole other blog post).  Yet it’s also a reminder of how we can forget about the other potential hazards of these potent drugs, delivered in easy-to-swallow capsules/tablets/liquids, if there are quality control or other manufacturing issues.  It’s as easy to forget as it is to pop them, well, like candy.

Would You Like Statins With That?

As we wrote on this blog the other day about research which raised questions about the efficacy of statins for those who have not yet experienced a heart attack– an off label prescription–the WSJ pointed to a new paper in the American Journal of Cardiology from authors at  Imperial College, London, U.K., which suggests that  statins should be made available free of charge to consumers along with the purchase of fast food. The press release from Imperial College can be found here.

Low level doses of statins may be purchased over the counter in England.

In a prior post, I  wrote about meeting with a cardiologist who suggested I commence taking statins because of my various cardio risk factors. A point, however uncomfortable at the time, made ultimately moot by the favorable results of my stress test, echocardiogram and calcium scoring. I had, prior to my surprisingly clean bill of cardiac health, relented mentally to the prospect of what would become a life long prescription. Of statins, I wrote:

“If one has risk factors, it is prophylactic and is prescribed to reduce the risk of heart attack, stroke and other heart diseases. It is doubtful whether once I start taking this drug I will ever stop. There is no foreseeable time (while alive) that I will wish to stop reducing the risk of heart attack or stroke. And that I suppose is the essence of the onset of age– piling up prescriptions. A daily regimen that will follow one to the grave–only the dosages or the brand names changing as each day welcomes a regimen of pills. In short, this prescription feels like the onset of dependence. The forward guard, if you will. A harbinger of a pharmaceutical future.”

One might say I didn’t take the news well. But crucial to my decision to relent were the words of my cardiologist and another heart doctor. I wrote:

Seeing my, shall we say, chagrin, the cardiologist told me that, like over 50% of the cardiologists he knows, he takes a statin. “We’ve seen the data.” Another recently told me  “Yeah, I take it. They should put it in the water.”

And now, apparently, in burgers.

But, we wrote of some  important (and conflicting) recent findings regarding statins here at HRW last week:

A LA Times article has recently highlighted the problems of off label prescriptions.  In the article, it has come to light that the off label use of statins, one of the world’s most prescribed medication, may not have the efficacy that many doctors had previously thought.  The LA Times reports,

Statins were initially approved by the Food and Drug Administration for the prevention of repeat heart attacks and strokes in patients with high cholesterol who had already had a heart attack. And used for that purpose - called “secondary prevention” - the drugs are powerful and effective medications, driving down patients’ risk of another heart attack or stroke by lowering their levels of LDL (or “bad”) cholesterol.

Then physicians came to believe statins could also reduce the risk of a first heart attack in people who have high LDL cholesterol but are nonetheless healthy. This use of statins - called “primary prevention” - has driven the growth in the market for statins over the last decade.

Statins certainly decrease rates of heart attack in people who have clear signs of cardiovascular disease but it’s not so clear they work that way in people who are healthy. In spite of that uncertainty, statins’ use for primary prevention has sky rocketed.

One wonders how so many physicians came to believe that statins could also reduce the risk first time heart attacks.  Dr. John Abramson, from Harvard Medical School, attributes statins’ off label growth to a “conspiracy of false hope.”  He states, “[t]he public wants an easy way to prevent heart disease, doctors want to reduce their patients’ risk of heart disease and drug companies want to maximize the number of people taking their pills to boost their sales and profits.”

So, with all these interests pushing for statins’ off label use, it should not be a great surprise that extensive research has not been performed regarding statins’ primary preventive effects- and conflicting results have emerged.  The LA Times reports,

In the first of three studies published in the Archives last month, medical researchers found that, contrary to widely held belief, statins do not drive down death rates among those who take them to prevent a first heart attack. A second article cast significant doubt on the influential findings of a 2006 study, called JUPITER, that has driven the expansion of statins’ use by healthy people with elevated blood levels of C-reactive protein, a measure of inflammation. A third article suggested potential ethical, clinical and financial conflicts of interest at work in the execution of the JUPITER study and concluded the widely hailed trial was “flawed” and raises “troubling questions concerning the role of commercial sponsors.”

So??? Statins anyone?

Limit Physicians’ Off Label Prescribing Practices?

Off label prescribing has become fairly common practice for many medical professionals.  Once a drug has been approved by the Food and Drug Administration (FDA) for a specific purpose, physicians are given the freedom to prescribe the approved drug “off label” for other beneficial uses of the drug.  There is a great interest for physicians to retain this autonomy of  prescribing drugs off label as the practice expands treatment options.  Both the American Medical Association and the FDA have recognized that physicians are in the best position to determine the method of treatment for their patients.

However, the practice of off label prescribing has not been without controversy.  Many politicians and regulators view off label prescribing as a way to avoid clinical testing and FDA approval process.  In addition, studies have shown that many physicians prescribe off label with little or no scientific rationale.  According to the Daily News Central, an example can be found in a particular study: “in all, the study estimated that 1 in 7 prescriptions were written [by doctors] without good medical evidence that they would work.”

A LA Times article has recently highlighted the problems of off label prescriptions.  In the article, it has come to light that the off label use of statins, one of the world’s most prescribed medication, may not have the efficacy that many doctors had previously thought.  The LA Times reports,

Statins were initially approved by the Food and Drug Administration for the prevention of repeat heart attacks and strokes in patients with high cholesterol who had already had a heart attack. And used for that purpose — called “secondary prevention” — the drugs are powerful and effective medications, driving down patients’ risk of another heart attack or stroke by lowering their levels of LDL (or “bad”) cholesterol.

Then physicians came to believe statins could also reduce the risk of a first heart attack in people who have high LDL cholesterol but are nonetheless healthy. This use of statins — called “primary prevention” — has driven the growth in the market for statins over the last decade.

Statins certainly decrease rates of heart attack in people who have clear signs of cardiovascular disease but it’s not so clear they work that way in people who are healthy. In spite of that uncertainty, statins’ use for primary prevention has sky rocketed.

One wonders how so many physicians came to believe that statins could also reduce the risk first time heart attacks.  Dr. John Abramson, from Harvard Medical School, attributes statins’ off label growth to a “conspiracy of false hope.”  He states, “[t]he public wants an easy way to prevent heart disease, doctors want to reduce their patients’ risk of heart disease and drug companies want to maximize the number of people taking their pills to boost their sales and profits.”

So, with all these interests pushing for statins’ off label use, it should not be a great surprise that extensive research has not been performed regarding statins’ primary preventive effects– and conflicting results have emerged.  The LA Times reports,

In the first of three studies published in the Archives last month, medical researchers found that, contrary to widely held belief, statins do not drive down death rates among those who take them to prevent a first heart attack. A second article cast significant doubt on the influential findings of a 2006 study, called JUPITER, that has driven the expansion of statins’ use by healthy people with elevated blood levels of C-reactive protein, a measure of inflammation. A third article suggested potential ethical, clinical and financial conflicts of interest at work in the execution of the JUPITER study and concluded the widely hailed trial was “flawed” and raises “troubling questions concerning the role of commercial sponsors.”

Potentially, new findings regarding the efficacy (or lack thereof) of statins can have seismic effects.  If it is found that statins’ primary preventative effects are overstated or  nonexistent, this would amount to what has been a tremendous amount of healthcare waste (time, money, and effort) due to the popularity of the drug.  According to IMS Health, U.S. patients filled 201.4 million prescriptions for statins last year alone.

While there is a strong interest for physicians to retain their autonomy when assessing the best treatment for the patient, due to the potential of healthcare waste, there may be an equal or if not stronger interest for some regulation regarding the practice of prescribing off label drugs. As to industry funding of research, there seems little incentive for a pharmaceutical company with a blockbuster off label hit to do anything which would upset the apple cart– or should I say money cart?

“The alternate approach to medical marijuana distribution,” an op-ed by Kate Greenwood featured in The Record

[Ed. Note: This op-ed piece was featured in The Record's Sunday Editorial Page and on North Jersey.com. It was written by Center for Health & Pharmaceutical Law & Policy Research Fellow and regular Health Reform Watch blogger, Kate Greenwood]

WE FEEL there is no question about it: The careful, legal distribution of medicinal marijuana to those in need is a good thing. The New Jersey Legislature agreed and passed legislation permitting distribution last January. Then-Gov. Jon Corzine signed the measure before leaving office.

But Governor Christie has requested a delay in its implementation, and a proposal to modify the system of distribution is cause for concern.

More than a year ago, Seton Hall Law’s Center for Health and Pharmaceutical Law and Policy distributed a position paper to New Jersey lawmakers urging passage of the marijuana measure, called the “New Jersey Compassionate Use Medical Marijuana Act.” The center did so citing the inclusion of “multiple measures designed to reduce the risk of abuse or diversion” and noting that “the medical literature supports the conclusion that smoked marijuana can provide relief to patients suffering from debilitating medical conditions for whom conventional treatments have failed.”

Implementation delayed

The act was to have taken effect this month, but, in response to a request from Christie, the Legislature pushed back the effective date to October.

As passed, the act provides that medical marijuana be grown and distributed by six not-for-profit “alternative treatment centers.”

But now, the New Jersey Council of Teaching Hospitals has proposed that the act be amended — before it is even implemented to provide that medical marijuana instead be grown by Rutgers University and distributed by the state’s teaching hospitals.

While hospitals are, as the Council of Teaching Hospitals points out, experienced dispensers of medicine, the act should not be rewritten to require them to dispense medical marijuana.

The passage of the act affects the rights and responsibilities of patients and providers of medical marijuana under New Jersey law; it does not change the fact that distribution and use of marijuana are illegal under federal law.

Although Attorney General Eric Holder has pledged not to prosecute patients and providers who comply with applicable state laws, and hospitals could thus dispense medical marijuana without fear of criminal prosecution, they would still be violating federal law.

Condition of participation

This is a problem because compliance with federal law is a condition of participation in the Medicaid and Medicare programs. Hospitals depend heavily on Medicaid and Medicare funding; the Compassionate Use Act’s alternative treatment centers would not.

Read More

Sunlight is a Weak Disinfectant

One of the most robust “memes” in contemporary law is the power of disclosure. In health law, disclosure comes up again and again: patients need to give “informed” consent, insurers are supposed to explain their policies clearly, and conflicts of interest, when not proscribed, should at the very least be exposed. But there are growing challenges to the disclosure meme, both within health law and without.

George Lowenstein and Peter Ubel note some problems with disclosure approaches in this article on the weaknesses of behavioral economics generally:

It seems that every week a new book or major newspaper article appears showing that irrational decision-making helped cause the housing bubble or the rise in health care costs. Such insights draw on behavioral economics, an increasingly popular field that incorporates elements from psychology to explain why people make seemingly irrational decisions, at least according to traditional economic theory and its emphasis on rational choice. . . . But the field has its limits. As policymakers use it to devise programs, it’s becoming clear that behavioral economics is being asked to solve problems it wasn’t meant to address.

[T]ake conflicts of interest in medicine. Despite volumes of research showing that pharmaceutical industry gifts distort decisions by doctors, the medical establishment has not mustered the will to bar such thinly disguised bribes, and the health care reform act fails to outlaw them. Instead, much like food labeling, the act includes “sunshine” provisions that will simply make information about these gifts available to the public. We have shifted the burden from industry, which has the power to change the way it does business, to the relatively uninformed and powerless consumer.

The same pattern can be seen in health care reform itself. The act promises to achieve the admirable goal of insuring most Americans, yet it fails to address the more fundamental problem of health care costs. . . . [T]he act tries to lower costs by promoting incentive programs that reward healthy behaviors. . . . [But s]tudies show that preventive medicine, even when it works, rarely saves money.

At its worst, disclosure can become merely pro forma; as Kafka (via Trudo Lemmens) puts it, “Leopards break into the temple and drink to the dregs what is in the sacrificial pitchers; this is repeated over and over again; finally it can be calculated in advance, and it becomes part of the ceremony.” Omri Ben-Shahar has argued that disclosure is one of many aspects of consumer protection law with little real impact on individual welfare. As Amelia Flood reports,

Ben-Shahar, who spent last summer studying all the mandated disclosure statutes in Illinois, Michigan and California, argues that consumer protection advocates have gotten it wrong when it comes to mandating information access for consumers. He says consumers get lost in a sea of technical language, unread disclaimers and long-shot lawsuits. . . . According to Ben-Shahar, disclosures are of more use to consumer ratings groups like Zagat and Consumer’s Digest than they are to most consumers.

So perhaps there is some hope here: third-party aggregators and raters might use disclosures as part of an overall effort to rate various hospitals or doctors. The question then becomes–who shall pay (and rate) the raters? One irony here is that doctor rating sites have themselves been accused of being insufficiently transparent about the ways in which they evaluate physicians. New York Attorney General Cuomo even pursued the matter. His office eventually settled with insurers who ran rating sites. They pledged to “fully disclose to consumers and physicians all aspects of their ranking system.”

What’s the lesson here? First, that consumers are, by and large, too busy to process piecemeal disclosures by professionals like physicians and other health care providers. Second, third party raters can fill some of this information gap by aggregating information. Third, this process of aggregation and rating itself will likely need to be closely supervised by a good-faith regulator, lest it fail to take into account the full range of interests (and quality of information) proper for the task.

Prescription Drug Abuse Up– Dramatically

I wrote the other day that I was “generally suspicious of the pharmaceutical zeitgeist. And terribly so as it concerns myself.” The following, I suppose, is that zeitgeist’s underbelly. Reuters reports:

U.S. officials reported a 400 percent increase over 10 years in the proportion of Americans treated for prescription painkiller abuse and said on Thursday the problem cut across age groups, geography and income.

The dramatic jump was higher than treatment admission rates for methamphetamine abuse, which doubled, and marijuana, which increased by almost half, according to figures from the Substance Abuse and Mental Health Services Administration.

They said 9.8 percent of hospital admissions for substance abuse in 2008 involved painkillers, up from 2.2 percent in 1998. The percentage of people admitted to treatment for alcohol dropped by 5 percent and for cocaine dropped by 16 percent over the same period.

The report, which is brief and chock full of interesting charts and graphs, can be found here.

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