During the last few years of recession, the brand-name drug industry has continued to charge higher and higher prices. In 2009, brand-name drug prices rose an average of 9%, while the recession kept prices in  nearly every other sector from rising, according to an AARP study. On the other hand, generic drugs, which cost between one-third and one tenth as much as brand-name drugs, have been dropping in price, including an 8% drop, on average, for the most widely used generics in 2009, according to AARP. Generics have been a life-saver for many patients, while saving the US health system an estimated $824 billion since 2001.  

But recently, some shortages of certain generic drugs have started to develop. A op-ed in this Sunday’s NY Times warns that over a third of  “the 34 generic cancer drugs on the market” were “in short supply . . . as of this month . . . .” The author, oncologist Ezekiel Emanuel, attributes a tenth of these shortages “to a lack of raw materials and essential ingredients” but then notes that  

“[most of the shortages] appear … to  be the  consequence of corporate decisions to cease production, or interruptions in production caused by money or quality problems, which manufacturers do not appear to be in a rush to fix.”

Dr. Emanuel speculates that a 2003 law regulating physician reimbursement for drug costs is the key obstacle a new generic drugmaker responding to a shortage by launching their own competing drug. But what’s missing is any explanation of how this a US drug pricing law, which affects primarily US seniors covered Medicare Part-B, has such a broad, market-wide, or even global effect upon the global manufacturing and supply of these essential cancer drugs. Don’t patients covered by health systems in Europe, Japan, and other countries, need, and pay for these drugs too?

We should also not overlook the benefits of the 2003 law that Dr. Emanuel cites. This law, the Medicare Prescription Drug, Improvement and Modernization Act of 2003, was passed to move Medicare Part-B reimbursement from the fictitious industry-created list price, called the “average wholesale price” to a realistic, evidence-based price benchmark based on average sales prices, plus 6%.  Dr.  Emanuel asserts that linking reimbursement to an average-plus-6% in effect limits the  growth of a generic drug’s price to only 6% every 6 months, because that’s how frequently the average sales prices are currently calculated.

While there may be some merit to this  critique, let’s not forget that Congress enacted this law in response to the multi-billion dollar AWP drug-pricing fraud by dozens of drug makers upon Medicare Part-B and private insurers. From the early 1990s until at least 2001, drug makers promoted hundreds of  their doctor-administered drugs by inflating the drug’s list price, called the ‘average wholesale price’ which was used by Medicare and private insurers to reimburse the doctor. Drug companies pitched to  doctors that their practices would reap far higher profits using a drug with an inflated price. This was called ‘marketing the spread.’ For years, doctors bought the drugs at a much lower price, and then kept the profits, costing our health system billions. At the same time, many cancer patients, struggling with their serious illness, were forced to pay higher and co-payments if they had insurance, and high out-of-pocket costs if they were uninsured. And patients’ medical care was subverted by the inappropriate financial incentives which amounted to hundreds of thousands of dollars a year for some doctors.

The 2001 PAL Average Wholesale Price lawsuit, following on federal government investigative reports, helped to highlight this problem, and led Congress to enact  the Medicare Prescription Drug, Improvement and Modernization Act of 2003. This law changed Medicare Part-B reimbursement from the fictitious industry-created “average wholesale price” to a more evidence-based price benchmark based on average sales prices.

Over 28 drug makers agreed to settle the litigation by the private sector for $125 million. Other lawsuits with other defendants for the same type of AWP-related pricing fraud upon consumers and the private sector have also been settled. But even the combined $860 million in total settlements of AWP fraud cases cannot protect consumers from the costs of increased premiums, and reduced quality of care as this 2003 law continues to do.

While the system for Medicare’s reimbursement of generic cancer drugs may need some corrections, such as a more rapid monthly or quarterly reporting of price data to incentivize new generics to fill any supply gaps, we should not remove the 2003 law’s common-sense protection that prevents drugmakers from gaming the system of government reimbursement.

Along these lines, some state Medicaid programs have started to move to similar evidence-based “average sales price” systems for pharmacy reimbursement as well.  Our health system should pay doctors and pharmacies prices that are closer to their actual costs, and not fictitious amounts cooked up by drugmakers for their own duplicitous ends.

 Harms to competition, and to consumer choice, cost, and privacy cited.

Community Catalyst joined Consumer Union, US Pirg, the National Consumer Federation, and NLARx to ask the FTC to order CVS-Caremark to undo the four year old merger between the CVS pharmacy chain and Caremark, one of the nations largest pharmacy benefits managers.

The letter, covered in today’s New York Times, describes how CVS has used their role as a pharmacy benefit manager (which simply tells a pharmacy whether your health plan covers your prescription or not) to gain customers over other pharmacies.  The letter notes how recent investigations by the FTC and 24 Attorneys General highlight a number of unfair practices designed to switch consumers to CVS pharmacies.

For instance, CVS-Caremark has allegedly charged consumers higher co-payments at  non-CVS pharmacies.  Also, by listing the  organization’s full name “CVS Caremark” on the benefits card provided to beneficiaries of the health plans Caremark serves, some consumers have been deceived into thinking that they can only fill their  prescriptions at  CVS pharmacies. Perhaps the most shocking conduct is the alleged practice of the pbm Caremark providing confidential consumer information to their CVS pharmacy operations, which allows the pharmacists “to solicit non-CVS customers by phone and mail in order to direct them to fill their prescriptions at CVS stores.”

The FTC has been investigating the anti-competitive practices of CVS-Caremark since 2009, and may decide soon how to address these alleged violations of anti-trust and consumer protection laws. The letter urged FTC to order the merger to be undone, and force CVS to sell its pbm business.  If the FTC decides against ordering the break-up of the CVS – Caremark entity, the letter asks FTC to require strong “nondiscrimination” protections for “consumers and pharmacies from programs … which force consumers to use either Caremark-owned mail order or CVS-owned retail pharmacies and ultimately lead to higher prices for consumers.”  The letter also asks FTC to appoint an “independent trustee” to monitor a “stringent firewall between CVS and Caremark” to “protect the confidential information of patients….”

For more info on some lawsuits by pharmacies and consumers concerning these unfair or anti-competitive practices, see Pharmalot’s blog here.

And to learn more about CVS-Caremarks practices that drive up their health plan customer’s costs, visit Change-to-Win’s Alarmed About CVS Caremark website.

Here is a blog from our partners at PostScript chronicling  the ground-breaking work by FDA under Dr. Joshua Sharfstein, the departing Deputy Commissioner who lead the agency’s work on regulation of prescription drugs and devices.  Since early 2009, Sharfstein has worked with FDA Commissioner Margaret Hamburg to lead the agency in assuming a more vigilant role on deceptive advertising to consumers and illegal promotions to practitioners, drug safety (here, here) and the agency’s overall transparency to industry and the public.

Many of these pro-consumer reforms at FDA are complete, while others are still underway. The overall impact, eloquently described by experienced analyst Ira Loss in a recent interview by Pharmalot, was that “ Sharfstein and Hamburg brought a public health mindset to the FDA, which was sadly lacking in the previous administration.” 

We wish Dr. Sharfstein the best of luck in his new work as the top public health official for the state of Maryland, and we hope that Commissioner Hamburg and Scharfstein’s successor are up to the challenge of keeping FDA on course as we enter what could be potentially troubled waters under the new Congress. 

The Sharfstein Years

Posted on: January 12, 2011; 11:30 am

As you’ve heard by now, FDA Deputy Commissioner Dr. Joshua Sharfstein is leaving his post at the FDA to become secretary of health and mental hygiene for Maryland. The blogosphere’s abuzz over what Sharfstein’s move means for the FDA and industry at the top of a new Congress, but amidst the speculation, we wanted to take a minute to review some of what Sharfstein did on the drug side of things during his two years at the agency. From an admittedly long and uncountable list, he:

–Oversaw an increase in the number of domestic and foreign inspectors

–Moved to collaborate with industry and lawmakers on improving supply chain security and oversight

–Launched the FDA transparency initiative, a three-phase process to lift the shroud of bureaucracy a bit (more on that soon)

–Engaged the agency in developing social media guidelines for drug and device makers (we await a final guidance).

In fact, Sharfstein was making waves at the FDA prior to being named deputy commissioner. As health commissioner in Baltimore, he and a group of fellow pediatricians filed a citizen petition in 2007 asking the FDA to reconsider the approval of over-the-counter cough and cold meds for small children, citing years of morbidity data and a lack of studies that showed the drugs to be safe or effective. The high-profile case led to manufacturers pulling under-2s’ cough and cold meds off the shelf–a move that was linked in Pediatrics last month in to a drop in related emergency room visits. (To date, we await the FDA’s final ruling on those products.)

In his post as deputy commissioner, Sharfstein was often the voice of the agency’s drug authority, and at a series of Congressional hearings on drug safety bills, heparin, and the J&J recalls, it was a guiding one. He came to the witness stand informed, open, willing to ask for things that the agency needed. As a physician, Sharfstein had the clinical experience and credibility to sign off on advisory committees’ important–and often contentious–approval and post-market debates. As a former Hill staffer, Sharfstein knew what could be done legislatively and how, and Members in turn offered bills that would give the agency authorities and resources that Sharfstein saw were needed.

And as a public health expert, Sharfstein helped recalibrate and rearticulate the agency’s mission in terms of protecting the public health through prevention, transparency, and collaboration. As Mark Senak at Eye on the FDA put it, Sharfstein’s and Commissioner Hamburg’s appointment signaled “that the agency was effectively turning a corner – that public health was the driving force and if you wanted to communicate effectively with the agency, framing a discussion–whether a drug approval or safety considerations or a policy decision – should be in public health vernacular.”

As a new Congress takes over the gavels, the clamor for faster approvals is growing, and several Members of Congress have suggested they intend to do some bureaucracy-busting on the historically beleaguered FDA. We hope that amidst these changes the agency can and will continue to focus on public health the way Sharfstein has, and carry out current initiatives and address new challenges in that spirit.

–Kate Petersen, PostScript blogger

Today’s Pharmalot had a great interview with Jon Liebowitz, the Chairman of the FTC, on the problem of pay-for-delay settlements that prevent consumer access to generic versions of Provigil, Androgel, and Cipro. With  more and more consumers telling PAL about their challenges paying for rising costs of prescription drugs, reforms to ban this collusive practice  are more important than ever. 

Here’s the Pharmalot interview :

In recent months, FTC commish Jon Liebowitz has resembled Don Quixote as he implored Congress to restrict pay-to-delay deals. The FTC views these patent settlements as anti-competitive, arguing they rob consumers of lower-cost meds that might otherwise arrive much sooner in pharmacies. In response, the US Senate Appropriations Committee voted to include a provision placing limits on such deals, but several Republican senators are voicing opposition (see here and here). Meanwhile, a federal court upheld the legality of the settlements, although one dissenting judge wrote that the practice should be reivewed by the US Supreme Court (back story), a suggestion that Liebowitz hopes will validate his view. We spoke with him about his quest and the odds for success…

Pharmalot: Why have you made pay-for-delay your cause?
Liebowitz: We actually have a number of issues that are enormously important at this agency, ranging from predatory lending to privacy to trying to police the high-tech marketplace. There was a major case against Intel, for instance. But yes, this is really important. It’s supposed to be about the greatest good for the greatest number of people. And that’s $3.5 billion in higher costs to consumers. I think that’s pretty meaningful. That’s why the entire commission, not just me, is interested. And that’s goes back to the last commission, which escalated the issue. It’s one of the most corrupt practices in health care.

Pharmalot: Yet, you haven’t had much luck. A recent federal appeals court upheld the practice and Republicans are threatening to block legislation. It seems you’re tilting at windmiYour odds don’t seem so good.
Leibowitz: We’ve had a two-pronged approach. One is to get a case to the Supreme Court and that’s the litigation prong. And the other is the legislative prong that would restrict these deals. And it’s pretty modest legislation. What are the chances (either will work)? We’ve made steady progress, although sometimes it’s two steps forward and one step back. But there was no legislation in 2006 or late 2005 and, on a bipartisan basis, (legislation we want) has passed the House twice. It’s (recently) passed the Senate Judiciary Committee with bi-partisan support and it’s in the appropriations bill with bipartisan support. So I think our chances are pretty darned good…

To read more about whether Chairman Leibowitz thinks the Supreme Court will take up this issue, or why he sees flaws in industry-backed studies that question the future savings from banning these pay-for-delay settlements, see the rest of the interview on the Pharmalot blog here . . .   

To find out more about pay-for-delay settlements, go to the PAL website here.

Second Circuit takes a pass on reviewing the legality of pay-for-delay settlements

A negative court decision before the Second Circuit this week underscores the importance of passing federal legislation to ban ‘pay-for-delay’ settlements in order to preserve access to affordable, quality prescription drug benefits. At issue is the drug industry practice of paying off generic competitors of expensive brand-name drugs to delay access to low-cost generics. See our earlier blogs here and here.

On Tuesday, the Second Circuit issued a decision on the legality of pay-for-delay settlements concerning the drug Cipro that dealt a blow to consumer advocates and consumer protection attorneys challenging these collusive agreements in court. The decision rebuffed the Federal Trade Commission, the Department of Justice, and a group of State Attorneys-General, all of whom asked the Court to re-evaluate an earlier precedent from 2005 that allowed such ‘pay-for-delay’ settlements.

While the attorneys ponder whether to appeal the case to the Supreme Court, the importance of a legislative solution to this problem becomes even more clear.

Current legislation before the U.S. Senate proposed by Senators Herb Kohl (D-WI) and Richard Durbin (D-IL) would create a presumption that any drug patent settlement that exchanges a payment in return for an agreement to delay bringing a generic to the market is a violation of anti-trust law. The bill gives the FTC the tools to challenge such settlements. However, it still allows the drug companies to prove that a settlement is not a collusive agreement, but a legitimate effort to avoid the time and costs of litigation.

Why is a ban on pay-for-delay settlements important? Since 2005, Congress has responded to concerns about potential collusion by requiring the drug industry to file any settlement of patent litigation concerning a generic drug under seal with the FTC. Since 2004, the FTC has reviewed these settlements, and found that an increasing number of ‘pay-for-delay’ sweetheart deals have been made since the courts started to allow them in 2005. Last fiscal year, a record 19 such pay-for-delay deals were made. By the nine month mark of this fiscal year on June 30, the record was broken, with 21 new pay-for-delay settlements.

These settlements have prevented billions of dollars in possible savings, by preventing generic drugs from being available. At a time when consumer advocacy groups like AARP are documenting exhorbitant price increases for brand-name drugs, generic drugs are the best solution. Another recent report found that every 2% increase in generic use saves Medicaid $1 billion a year.

The FTC, which reviews these agreements, reported in January 2010 that $20 billion dollars in annual brand-name drug spending was being insulated from generic competition by pay-for-delay sweetheart deals. Then, in July, the FTC reported that new pay-for-delay deals were shielding another $9 billion in drug spending from market competition.

How does this impact consumers? The FTC reports that pay-for-delay settlements keep a generic drug off the market for an average of 17 months. The FTC estimates that being forced to take a brand-name drug costing $300 per month, instead of a generic costing $30, would increase a consumer’s health cost by $4,590 over that 17-month period. Drugs that cost more, or that have longer delays, will cost even more.

If a robust, competitive market is to play a role in our new health care system, shielding nearly ten percent of all annual brand-name drug sales from market competition will only allow drug company price increases to continue depleting more and more of our health care resources, while putting more patient care at risk.

In a brief filed with the court, the AMA and AARP described having access to a generic drug improves the quality of patient care:

The price of a brand drug can be prohibitive for uninsured patients who do not have help covering the cost of their prescription drugs. Even for those patients who are insured but who are on fixed or limited incomes, having a generic option is often the difference between having access to a health care treatment and not having any treatment option at all.

And the lawsuit filed by PAL member AFSCME District Council 37in 2006 is challenging the pay-for-delay settlements concerning the drug Provigil, used to treat narcolepsy. This lawsuit has revealed how the lack of competition reduces patients’ quality of life or quality of care when an insurance company refuses to pay for a high-cost brand-name drug. A pastor from Ohio reports that after

paying almost $17,000 in annual premiums for my family [health insurance plan, l] ast year, I was paying around $650/month [for Provigil. I]t now costs me $852/month. That is out of pocket money I have to come up with until later in the year when I reach my deductable and I can enjoy a few months of only paying $60/month. I cannot describe to you how much stress and difficulty this has caused for me and my family the last several years. As you can imagine, with my income, I often cannot afford to refill my prescription. I often take 1/2 or 3/4 of my dosage on days I know I won’t be driving much so I can delay getting a refill. But I do a lot of driving for my work, so I am forced to spend lots of money I don’t have just so I can be safe driving.

To find out how you can support legislation to prevent these pay-for-delay settlements, please contact us!

Posted today by the PostScript blog at Community Catalyst:

Posted on: August 4, 2010; 11:53 am

Yesterday, Senator Michael Bennet (D-CO) unveiled new legislation that seeks to improve the safety of America’s drug supply. The Drug Safety and Accountability Act of 2010 is an important first step in solving a growing problem. It mandates improvement of industry safety and quality standards for both prescription and over-the-counter drugs, provides increased FDA oversight, and gives the FDA much-needed authority to actively protect the drug supply through mandatory recall of dangerous products, as well as to subpoena documents and witnesses. The bill also improves enforcement through whistleblower protections and civil monetary penalties for industry violations.

In announcing the filing of the bill, Sen. Bennet shared his concerns about the issue and his commitment to ensuring the American drug supply is safe no matter where its drugs are made. “Making sure pharmaceutical drugs meet the highest standards for safety and quality is important to me, not only as a U.S. Senator, but as the father of three little girls as well,” said Sen. Bennet in a press conference organized by the Pew Prescription Project. “For too long, the FDA has lacked the proper authority to adequately safeguard our drug supply and protect Colorado consumers.”

Why now?

Americans are concerned about the drug supply, says a Pew Prescription Project survey released yesterday, and they have reason to be.

Manufacturing of pharmaceuticals has changed dramatically in recent years, with more than 80 percent of the active ingredients in all U.S. prescription drugs now originating overseas, often in countries with weak regulatory and enforcement infrastructures such as China and India. In these counties, where quality standards differ from our own and where responsibility for drug purity is murky at best, it is increasingly difficult for the FDA to ensure the safety and efficacy of a drug when they cannot track the uncertain and complex manufacturing processes.

According to the Pew Prescription Project survey, the confidence Americans have in drugs made in some countries overseas is next to none. While three out of four Americans believe drugs made in the U.S. are contaminate-free, only one in 10 believes the same for drugs made in China or India. What’s more, most believe Congress should do more to legislate in this area and over half of those surveyed favor FDA inspection of overseas drug companies.

The recent recalls of Johnson & Johnson’s children’s Tylenol and other cough & cold medicines were another wake-up call to protect Americans from the risks of unsafe drugs, but they were also the most recent in a long line of issues.

The numbers are telling

• In June, drug manufacturers recalled intravenous bags of certain antibiotics manufactured in India found to be unsterile and at least in one case to contain mold.
• In May, the FDA sent a warning letter to a pharmaceutical company for failing to set quality standards for its outsourcing that allowed them to skirt important safety practices.
• There were more than 1,700 drug recalls in 2009 – four times more than in 2008. Most of the recalls were for problems related to manufacturing quality and testing.
• In 2007 and 2008 a contaminated blood thinner, heparin, made in China entered this country and more than 100 Americans died in that case.

Community Catalyst is collaborating with the Pew Prescription Project to spearhead work on this issue in the best interest of American consumers.  The impact of drug safety problems is potentially enormous, given that adults and children alike have increasingly come to rely on pharmaceuticals for the cure and management of a wide variety of common, chronic and serious medical conditions. Indeed, Kaiser reports that the use of prescription medications has risen 39 percent in the last decade in the U.S. while the population grew 9 percent. Today 90 percent of seniors and 58 percent of other adults rely on a prescription medication on a regular basis. Among children, a 2009 survey found that 56 percent had used at least one medication in the previous week, and most of those were over-the-counter products (Pediatrics, August 2009).

With the goal of addressing this problem by strengthening the regulation of the manufacturing process for drugs, Community Catalyst supports Sen. Bennet’s legislation and is working to educate and assemble national and state groups to do the same.

– Jessica Hamilton, Program Associate

You may view the latest post at: http://postscript.communitycatalyst.org/?p=1549

The last year has been a roller coaster-ride of both successes and set-backs in the fight to eliminate pay-for delay settlements. These multi-million dollar sweetheart deals have been used more and more by brand-named drug makers to get their generic competitors to agree to delay bringing affordable generics to the market.

A bill to ban these agreements was included in the House’s health care reform proposal last fall, and a similar measure was supported by the White House and considered by the Senate. Unfortunately, the Senate’s procedural and jurisdictional rules kept the measure from being included in the national health reform bill enacted in March.

Undeterred, leaders in the House then included the measure in an appropriations bill approved on July 1^st. But the Senate passed one appropriations bill on July 22 without the provision. In the aftermath of this setback, consumer champion Senator Herb Kohl (D-WI) and others succeeded in including this vital reform as an amendment to the FTC’s budget authorization. Kohl and others then  overcame the next major hurdle yesterday, narrowly stopping  drug industry lobbyist efforts to strip the measure in the Senate Appropriations Committee.

Yesterday’s vote was a dramatic one.  Senator Arlen Specter (D-PA) introduced an amendment to remove the pay-for-delay provision from the Committee bill. When four Democrats voted with Specter  to strip away the pay-for-delay provision, the AP reports that:

“Drug company lobbyists in the audience thought they had the vote won, provided they could win over every panel Republican. But Sen. Richard Shelby, R-Ala., voted against the drug companies, helping give Kohl and Durbin [the author of the Appropriations Bill] a surprise win.”

Recent settlements shielding $9 Billion in drug spending from generic competition

The Federal Trade Commission (FTC), which has consistently challenged these anti-competitive agreements in the courts and through testimonies before Congress, called yesterday’s vote a significant victory. FTC chairman Jon Leibowitz testified before Congress earlier this week that these types of pay-for-delay agreements, which delay the entry of generic drugs, are becoming more common (see graph). Legal decisions permitting these agreements have led to their proliferation from none in 2004 to a former high of 19 such agreements in 2009. The FTC notes that in just the first 9 months, the number of pay-for-delay settlements in fiscal year 2010 has already topped last year’s record high.

Graph: Federal Trade Commission

The FTC’s preliminary analysis of the agreement filed this fiscal year concludes that 21 pay-for-delay agreements entered into this year are protecting $9 billion in prescription drug sales from generic competition. Combined with the earlier agreements in effect, this could mean that as much as $29 billion in annual spending on drugs are improperly shielded from generic challengers.  That is a significant loss of possible savings.  The FTC estimates (conservatively, in our opinion) that these settlements are costing consumers and our health system at least $3.5 billion a year.

FTC has continued to raise the alarm about these settlements, and their effect upon consumers. In a press release coinciding with testimony before Congress, FTC Chairman Jon Leibowitz summed it up:

“That’s almost an epidemic,” Chairman Leibowitz said, “and left untreated, these types of settlements will continue to insulate more and more drugs from competition. Every single FTC Commissioner, going back through the Bush and Clinton administrations, has supported stopping these unconscionable agreements.”

On the legal front, PAL continues to support efforts to do away will these settlements. PAL and AFSCME District Council 37 filed an amicus brief in May in support of the Second Circuit’s reconsideration of the legality of these agreements in the Cipro litigation. And the PAL-member lawsuit challenging the pay-for-delay settlements concerning Provigil continues.

FTC Chairman Leibowitz testified that some of these recent events, such as the Second Circuits Cipro decision and the fact that the House has already passed a ban on these settlements, gives him “reason to believe that the tide may be turning, both in the courts and in Congress.” Yet, Chairman Leibowitz wisely cautioned that bringing about such a reform through the Courts will take time, which means that  “legislation would be the most effective way to stop these deals.”

Thus the successful Senate Committee vote yesterday “means that consumers are one step closer to saving billions on their prescription drugs” according to Leibowitz.  And help can’t come too soon.  The bill’s Senate sponsor, Senator Herb Kohl, points out why:

“The cost of brand-named drugs rose nearly ten percent last year. In contrast, the cost of generic drugs fell by nearly ten percent. At this time of spiraling health care costs, we cannot turn a blind eye to these anticompetitive backroom deals that deny consumers access to affordable generic drugs.”

We view yesterday’s decision as a crucial step  to put legislation in place to end these agreements and foster consumer access to affordable generic drugs.

Billion-dollar settlement of Paxil birth-defect lawsuits

Only a week after Glaxo SmithKline (GSK) agreed to pay $460 million to settle over 10,000 personal injury lawsuits related to Avandia,  it was reported that GSK has agreed to pay $1 billion dollars to settle  800 cases related to birth defects caused by  the GSK anti-depressant Paxil, taken by pregnant women. Both of these settlements are part of the $2.4 billion GSK has set aside to resolve pending litigation, according to corporate filings last week.

This $1 billion Paxil settlement will provide an average payout of more than $1.2 million to each family of an affected child, many of whom are left with heart defects as a result of their mother taking the drug. However, this settlement leaves more than 100 related cases still pending.

This settlement also follows a recent trial in Philadelphia, where a jury awarded a family $2.5 million for their child’s heart birth defect caused by Paxil. That lawsuit revealed internal “Glaxo documents showing executives talked about burying negative studies about Paxil’s links to birth defects and that its own scientists were alarmed by the rising number of children who had been affected by the drug in the womb.”

These recent settlements, combined with  earlier ones related to allegations that Paxil caused suicide, attempted suicide, and addiction, brings GSK’s total settlements on Paxil to over $2 billion so far.

Yet GSK sales of Paxil, one of the true blockbuster drugs in the last 15 years, generated $11.7 billion in US sales between 1997 and 2006. So GSK has profited dramatically from this drug, while leaving a wide trail of shattered lives and grieving families.

Despite these settlements and the 2005 black-box warning the FDA added to the drug’s label on increased risks of suicidal thoughts among adolescents, Paxil still earned $793 in sales in 2009.  It continues to be one of the more profitable drugs on the market.

Avandia study suspended, conflicts revealed

In a statement released yesterday, the FDA placed the TIDE (Thiazolidinedione Intervention with Vitamin D Evaluation) study comparing Avandia with its rival Actos on a “partial clinical hold.” This means that no new subjects can be enrolled, but that existing subjects can continue to participate.

This decision by the FDA is not all that surprising since, even though the FDA’s Advisory Panel voted 19-11 last week to recommend that the study continue, there was at least one member of the panel who questioned whether it was ethical to continue this study in light of the known serious cardiac risks.

Though the FDA had previously stated that they issued no conflict of interest waivers for the advisory panel hearing last week, two conflicts have since come to light. David Capuzzi, an endocrinologist on the panel, earned $3,750 last year (and $14,750 in total) as a speaker for another GSK drug, Lovaza. Though Dr. Cappuzzi denies he ever spoke about Avandia, a GSK spokesman reported that at least one of Capuzzi’s talks prior to 2008 was on Avandia. It is noteworthy that Dr. Capuzzi defended Avandia during the advisory panel hearing and voted to keep it on the market despite the fact that he claimed he rarely prescribes Avandia as he does not “like the whole class of drugs” and prefers to prescribe metformin.

Dr. Capuzzi explained his failure to disclose by saying that “the FDA doesn’t consider a different product for the same company to be a conflict of interest.” He furthermore said that he did not disclose this information to the FDA because he was never asked about it.

…. Really?

Pharmalot (hat-tip) reports that the FDA policy requires that panel members “report all current financial interests and those held within the previous 12 months that could be affected by the discussion and outcomes of the meeting, or that would present appearance issues.”

The FDA went on to say that they “take these allegations [against Cappuzzi] very seriously and [are] investigating the matter.” Additionally, Pharmalot reported that an FDA spokeswoman stated that “a decision [on their investigation] is expected by the end of the week and, if the agency determines there was misconduct, the matter could be referred to the HHS Office of Inspector General.”

On the flip side, the Wall Street Journal reported yesterday that Abraham Thomas, a doctor who voted to take Avandia off the market, was a paid spokesman for Takeda, who produces Avandia’s rival drug, Actos. Dr. Thomas was a member of the Takeda Diabetes Speakers Bureau from September 2007 to September 2008 and received $5,000 for giving two presentations. It is currently unclear if Dr. Thomas will be investigated by the FDA as well, since his relationship with Takeda took place over a year ago.

Ultimately, other panel members that have been interviewed do not feel that these conflicts of interests affected their decisions. One stated, “the panelists came prepared and had very strong opinions [that] won’t be easily swayed by other people’s opinions unless they’re very compelling,” but one panelist did say that the FDA “encourage[d] us to err on overdisclosing  [and]  to disclose anything in [our] past that may have relevance.” You would think that a paid relationship with the pharmaceutical company in question, or one with the drug’s  major rival in its class would be relevant enough a potential conflict for someone to disclose.

Panel decision-making warrant scrutiny 

 Finally,  in even more news to cause the public to question the reasoning methods used by the Avandia advisory panel, it was recently reported by the USA Today that at least one of the 10 advisory panel members who voted to keep Avandia on the market with tight restrictions says he’d actually prefer that the FDA withdraw it. This panelist, Clifford Rosen, has publicly stated that the only reason he didn’t vote to withdraw Avandia from the market is because he was “very anxious” he’d be the only one to vote that way. Dr. Rosen, who chaired the 2007 advisory committee meeting where panelists voted 22-1 to keep Avandia on the market despite the cardiovascular risks associated with the drug, says that he and the 21 other panelists who voted to keep the drug on the market  did so because they did not know whether Actos may be even riskier. Despite his previous vote, Rosen has stated that he has not prescribed Avandia since this 2007 meeting.

 After all this, we clearly haven’t heard the last on Avandia ….

Following up on last week’s blog discussing the FDA hearing underway to determine the safety of the prescription diabetes drug, Avandia, the FDA advisory review panel concluded a two-day hearing last Wednesday by recommending 20 to 12 that Avandia remain on the market with label revisions and other restrictions. This deeply divided panel included 17 votes to add warnings or restrictions on the drug, and 12 votes to remove the drug from the market.

The members voting for Avandia’s removal said the drug “has no unique benefits and therefore the benefits of the drug do not outweigh the risks.” They also pointed out that Avandia’s primary competitor, Actos, is an acceptable alternative to Avandia and therefore there is no therapeutic necessity to keep Avandia on the market.

Even the use of Actos has been called into question. Harvard researchers based at the Independent Drug Information Service (www.RxFacts.org), note that “in mid-2007 the FDA added black-box warnings cautioning that both rosiglitazone (Avandia) and pioglitazone (Actos) increase the risk of congestive heart failure.” These safety concerns, “along with an increased risk of fracture, have greatly dampened enthusiasm for use of both of these drugs.”

The ultimate fate of Avandia now rests in the hands of the FDA who stated that they “took the panel’s advice seriously and that [the FDA] would consider its regulatory options.” If the proposed additional warnings and restrictions are implemented, scientist Steve Nissen, who published the first study documenting the cardiac risks of Avandia in 2007, estimates that 95 percent of Avandia’s use will end. “Effectively, this drug is gone.”

Interestingly, the committee also recommended by a vote of 19-11 that the trial currently underway comparing Avandia to its rival Actos be continued, though at least one member questioned the ethics of this, given the potential risks.

Litigation yields access to studies, helps expose risks

Litigation plays a valuable role in exposing industry schemes to withhold safety data. For instance, GSK’s earlier suppression of studies showing risks associated with the drug Paxil lead to litigation and settlements that required GSK to post information on-line about all their clinical trials. It was this posted information that Nissen and fellow researcher Kathy Wolski of the Cleveland Clinic used to perform their 2007 analysis of over 40 studies that showed that Avandia raised the risk of heart attack, stroke and death in comparison to Actos.

Another example of the benefit of litigation is seen by the PAL-member class action lawsuit concerning the drug Zyprexa whichyielded hundreds of documents, some of which revealed Eli Lilly’s own internal studies documenting the increased risks that Zyprexa posed as a treatment for dementia in elderly patients.

New evidence, studies bring risks to light

Ongoing investigations by Senator Grassley and almost a dozen new studies documenting the risks of Avandia have kept the issue alive, prompting the FDA’s ongoing review, including last week’s hearing.

One comparative effectiveness study by David Graham of the FDA was published this past June. Graham worked with researchers at the Centers for Medicare and Medicaid Services to collect records from nearly a quarter million Medicare recipients.  Elderly diabetics, who used Avandia instead of its competitor, Actos, had a 68 percent increase in the risk of heart attack, stroke, heart failure or death. Graham stated:

“We estimate that about 48,000 excess cases of [heart attack], stroke, heart failure, or death were attributable to the use of [Avandia] rather than [Actos] from 1999-2009.”

Graham additionally stated “the RECORD study would have been dismissed as ’garbage’ if it had been used to seek the drug’s original approval.”

What’s next?

The question of whether the FDA will allow Avandia to remain on the market is still up in the air.  Beyond that, what else can we do to stop such illegal and hazardous industry behavior—the same behavior that resulted in the Vioxx tragedy, which lead to up to 60,000 deaths? As litigation and other sources have revealed suppression of drug risks concerning Vioxx, Paxil, Celexa, Zyprexa, and many other drugs, the problem seems endemic.

To begin to address this problem, the FDA needs the resources and authority to examine all relevant clinical studies for data-tampering. Government and private consumer lawsuits must continue, including possible criminal prosecution. Finally, we should all remember that what you read on your drug label or hear in a TV ad may not be the whole story. Skepticism is warranted and further regulation is critical to all of us–we need medical care we can trust.