Health Science

Many big health care organizations seem to just be unable to keep out of trouble, and the bigger they are, the more kinds of trouble.  Pfizer Inc, considered to be one of the world's largest pharmaceutical companies, has supplied us with plenty of stories.  Enough new stories about Pfizer have accumulated since last year to do a roundup.   

Presented in chronological order....

Italy Demands Damages from Pfizer for Anti-Trust Violations

This story came out in May, 2014, via Reuters,

Italy said on Wednesday it was seeking more than a billion euros in damages from multinational drug companies following a ruling by the country's antitrust authority that their policies had been detrimental to Italy's national health service.

The health ministry said in a statement it was requesting a total 1.2 billion euros ($1.6 billion) from Novartis and Roche for the damages incurred in 2012-2014, and was requesting 14 million euros from Pfizer.

It cited several recent antitrust rulings that the companies' repeated anti-competitive actions had caused the national health service 'considerable damage'.

The specific charges against Pfizer were:

Italy's state council, the highest administrative court, in February ruled that Pfizer had abused its dominant position relating to the glaucoma drug Xalatan 'with a clear and persistent intention to suppress competition'.

At least in English language news sources, I have not seen how this turned out, but note that this was apparently an administrative court finding, not just a prosecutor's allegation.

Pfizer Accused of Overcharging for Pediatric Vaccines

This appeared in January, 2015, here via Ed Silverman's PharmaLot blog (when it was affiliated with the Wall Street Journal),

In a bid to widen access to vaccines, Doctors Without Borders is calling on Pfizer and GlaxoSmithKline to lower the prices for their pneumococcal vaccines to $5 per child in developing countries. The non-profit claims the drug makers are 'overcharging' donors and developing countries for vaccines that 'already earn them billions of dollars in wealthy countries.'

The non-profit, which regularly advocates for lower prices for medicines, maintains that, in general, the price to vaccinate a child against several diseases is now a 'colossal' 68 times more expensive than in 2001. In a new report, Doctors Without Borders attributes 45% of that increased cost to the price tags for pneumococcal vaccines sold by the drug makers. Pneumococcal disease, by the way, kills about 1 million children per year, mostly in poor and developing nations.

Think about the children.

The non-profit maintains that the current price tag makes it difficult to supply the vaccine to large numbers of children, and the drug makers have already received $1 billion in incentives to manufacturer the vaccine for developing countries. 'We think it’s time for Glaxo and Pfizer to do their part to make vaccines more affordable for countries in the long term, because the discounts the companies are offering today are just not good enough,' says Malpani in a statement.

Moreover, Doctors Without Borders warns that pricing may eventually make it harder for a growing number of middle-income countries to afford vaccines. Over time, some of these countries will eventually ‘graduate’ from the subsidized vaccine pricing established by Gavi and, when that happens, Doctors Without Borders estimates costs may rise up to six times what is the countries pay today.

The post included a statement from Pfizer about how hard it is to manufacture the vaccine, and an update to the post included a statement from Pfizer that it was already selling its pneumococcal vaccine, Prevenar 13, below cost to GAVI, which buys up vaccines and provides them to poor countries. A week later, again via (the old version of) PharmaLot, Pfizer announced an additional 6% price cut. Furthermore, Bill Gates, whose foundation supports GAVI, insisted that cutting vaccine prices would discourage pharmaceutical companies from investing in vaccine research and supplying products to poor countries, according to the Guardian.

However, neither Pfizer nor Mr Gates acknowledged how much money Pfizer already is making from Prevenar in developed countries, amounts which likely do far more than offset any losses in poorer countries. Specifically, in July, 2015 FierceVaccines reported that

The world's biggest vaccine by sales--Prevnar 13--just keeps getting bigger. And in doing so, the shot helped Pfizer notch 44% vaccines growth for the second quarter as the unit saw sales grow from $1.09 billion in last year's Q2 to $1.58 billion during the period this year.

For the quarter, the superstar pneumococcal disease-blocker notched a U.S. sales increase of 87% versus the same period last year, a jump Pfizer CEO Ian Read attributed to 'continued strong uptake' in U.S. adults.

Also,

Prevnar 13, which reeled in $4.29 billion in sales last year, is expected to grow to $5.83 billion in 2020 and remain atop the vaccines sales charts.

And,

The company is also working 'country by country' to broaden the vaccine's reach in G7 countries....

So there seems to be some evidence in support of the Doctors Without Borders claim that Pfizer could easily afford some small losses selling vaccines for use by poor children in less developed countries while it makes billions of dollars from vaccine sales in developed countries.  


Pfizer Settles Shareholder Suit for $400M

This settlement was just the latest that has resulted from allegations of illegal drug marketing by Pfizer.  As reported again by the redoubtable Ed Silverman in the old version of PharmaLot,

Pfizer has reached an agreement in principle to pay $400 million to settle a class-action securities lawsuit that alleged the drug maker illegally marketed several medicines and, subsequently, caused investors to lose money, according to a filing with the U.S. Securities and Exchange Commission.

The lawsuit alleged that, between January 2006 and January 2009, Pfizer marketed several drugs on an off-label basis. The medicines included the Bextra painkiller that was withdrawn from the market in 2005; the Geodon antipsychotic; the Zyvox antibiotic and the Lyrica epilepsy treatment.

The lawsuit, which was filed in federal court in 2010, alleged that the sales boost the drug maker received from the marketing prompted Pfizer executives to make 'false and misleading statements about Pfizer’s financial performance and sales practices [that] caused Pfizer stock to trade at artificially inflated prices.'

This settlement followed an even larger one back in 2009 when,

the drug maker revealed plans to pay $2.3 billion to resolve criminal and civil allegations that these drugs were marketed illegally.

We discussed that settlement in 2009 here, here, and here.  Note that the 2009 settlement included a guilty plea to a criminal charge (albeit to a misdemeanor), and was of allegations including paying kickbacks to doctors for use of Pfizer drugs.  So this additional settlement of deceiving investors just ices that cake. 

UK Competition and Markets Authority Stated Pfizer Abused Market Dominance

This story appeared in August, 2015, via the Telegraph,

The Competition and Markets Authority (CMA) has issued a statement of objections alleging the companies breached UK and EU law by raising the prices they charged for phenytoin sodium sold to the NHS.

In particular,

The CMA says that for years industry giant Pfizer, which is listed in the US, and Flynn, a Stevenage-based company, between them sold the drug at a price up to 27 times higher than it had been previously priced.

Before September 2012, Pfizer manufactured and sold phenytoin sodium capsules to UK wholesalers and pharmacies under the brand name Epanutin.

Pfizer then sold the UK distribution rights for Epanutin to Flynn, which 'de-branded' the drug and started selling its version in September 2012. Pfizer continued to manufacture the drug, which it sold to Flynn at prices the CMA says were 'significantly higher' than those at which it had previously sold Epanutin.

The CMA claims Pfizer sold the drug at between 8 and 17 times its historic prices to Flynn, which then sold on phenytoin sodium at between 25 to 27 times more than the prices previously charged by Pfizer.

Before Flynn bought the rights for Epanutin, the NHS spent about £2.3m on phenytoin sodium capsules a year, according to the CMA. After the deal this spend rose to just over £50m in 2013 and more than £40m in 2014.

While the CMA findings were apparently "provisional," but the agency has the power to find that the law has been breached and "has the power to fine then up to 10pc of their global annual turnover - last year Pfizer had revenue of almost $50bn."  So this is the second government finding of anti-competitive behavior by Pfizer in a little over one year.

Pfizer Resists AllTrials Calls for Transparency

Late in August, 2014, per the Guardian,

Pfizer, one of the world’s largest pharmaceutical groups, has said it will resist demands from investors and transparency campaigners that it disclose results from all historical drug trials.

We have been discussing how pharmaceutical, biotechnology, and device companies have manipulated the clinical trials they sponsor to increase the likelihood that the results make their products look good, and may suppress trials whose results cannot be made to look good enough. This clinical research suppression and manipulation can lead to poor clinical decisions, may harm patients, and abuses the trust of patients who volunteer to participate in clinical research. This situation has led to the AllTrials campaign to make clinical research transparent (look here). However,

Pfizer said it had a 'longstanding commitment to clinical trial transparency' and it already published data for trials from 2007. Requests for earlier data are considered on an individual basis. But it added: 'We don’t believe that further investment beyond this would offer value to patients, health services or to our shareholders.'

This despite arguments above about the harms of research suppression.  Given how much money Pfizer has spent on lawsuits, including one above about allegations of its management's deception of shareholders, one might think it would be worth it for management to make a little investment in transparency.

Pfizer Found to Have Withheld Reports of Adverse Drug Events in Japan

Finally, reported in September, 2015 by in-PharmaTechnologist.com,

Pfizer failed to report hundreds of serious adverse drug reactions (ADRs) in the required timeframes according to Japan’s Ministry of Health, Labor and Welfare (MHLW) which has issued the US firm with a business improvement order. 

That website has copy protection so I cannot quote further, but the order involved 11 drugs, including Enbrel and Lyrica.  So here is yet another example of a government agency finding that Pfizer was less than transparent, if not overtly deceptive.

Summary

So in a little more than a year, Pfizer has been accused of anti-competitive practices raising drug costs in Italy, excess pricing of vaccines for use by poor children in undeveloped countries, deceiving its own investors about illegal marketing activities in the US, abuse of market dominance leading to excessive drug costs in the UK, stonewalling clinical trial transparency measures globally, and failing to disclose adverse drug effects in a timely manner in Japan.  This is on top of an already impressive record of misbehavior (See our summary of Pfizer mischief at the end of the post.)

However, as seems usual these days, no one at Pfizer who might have authorized, directed or implemented any of this bad behavior has ever seemingly paid any sort of penalty for it.  Instead, while this was going on, the top leadership of Pfizer just gets richer faster and faster.  In fact, in March, 2015, the Wall Street Journal reported the current Pfizer CEO's total compensation in 2014,

Pfizer Inc. said Thursday that Chief Executive Ian Read’s total compensation rose 23% last year, lifted by an increase in pension value that offset a reduced annual bonus and equity award.

Furthermore,

Mr. Read’s 2014 pay package totaled $23.3 million. The board raised the CEO’s salary to $1.83 million from $1.79 million but decreased his annual bonus by $400,000 and his equity award by nearly $1 million despite concluding that Mr. Read’s leadership during the year was 'outstanding.'

[Even though] Over the course of 2014, shares in the New York-based pharmaceutical company gained about 2% amid a 4% decrease in revenue.

It is not obvious that the rise in CEO pay is even remotely correlated to any rise in share-holder value.  Moreover, there seems to be a total disconnect between the rewards given the CEO and the ethical record of the company he leads, especially since Pfizer, which calls itself "one of the world's premier pharmaceutical" corporations, announces its aspirations thus,

we at Pfizer are committed to applying science and our global resources to improve health and well-being at every stage of life. We strive to provide access to safe, effective and affordable medicines and related health care services to the people who need them.

Never mind all those pesky allegations of overpricing, anti-competitive practices, deception and opaqueness, and never mind that current executives are becoming exceedingly risk in part from the continuation of such practices.  So it seems the board of Pfizer will just continue handing its executives piles of money, despite, or for all I know, because of the company's continuing bad behavior.  Given these incentives, is it any wonder that the bad behavior continues?  Pfizer seems to be just another example - albeit a big one - of how health care is dominated by an oligarchy of unaccountable leaders who continue to demonstrate their impunity hidden by aspirational but hollow public relations and marketing.

Of course, it is doubtful such bad behavior would continue if there risks of external penalties, e.g., from law enforcement.  But there never seem to be any.

In the past, US law enforcement authorities have announced they would use the responsible corporate officer doctrine, a legally tested rationale for prosecuting corporate managers for bad behavior by those who report to them (e.g., in 2010, look here),  But it seems they have never done so, at least in cases involving large health care organizations.  Last week, the US Department of Justice announced it would start going after executives of companies that misbehave, and would press the companies to give up the name of responsible executives in exchange for more lenient treatment of the companies themselves (e.g., see this report in the NY Times).  Meanwhile, however, the march of legal settlements for bad behavior in health care continues, absent any penalties for organizational leaders who might have authorized or directed it, much less for those who simply put incentives in place to foster bad behavior while looking away from what those incentives inspired.    

I hope these current promises by law enforcement officials are not as hollow as earlier ones, because continuing our society's continuing failure to rein in corrupt business practices via law enforcement and regulation may lead a desperate populace to more radical approaches. The UK Labor Party just elected a Marxist leader (see this Reuters report.)  One wonders how long it will be before anger at the larger oligarchy, of which health care leadership is merely a part, boils over in other countries, and in more radical ways.

Instead, we continue to advocate for true health care reform with the immediate priority of changing how health care organizations are led, and ensuring leadership that upholds health care values, is willing to be accountable, and is open, honest, transparent and ethical.  We still may have time to reform.  But the reform will have to be big and true.  If not, moderate voices may be drowned out, and the results may be worse than anyone could imagine.

Appendix - Pfizer's Previous Settlements


For all our posts on Pfizer, look here.

In the beginning of the 21st century, according to the Philadelphia Inquirer, Pfizer made three major settlements,
- In 2002, Pfizer and subsidiaries Warner-Lambert and Parke-Davis agreed to pay $49 million to settle allegations that the company fraudulently avoided paying fully rebates owed to the state and federal governments under the national Medicaid Rebate program for the cholesterol-lowering drug Lipitor.
- In 2004, Pfizer agreed to pay $430 million to settle DOJ claims involving the off-label promotion of the epilepsy drug Neurontin by subsidiary Warner-Lambert. The promotions included flying doctors to lavish resorts and paying them hefty speakers' fees to tout the drug. The company said the activity took place years before it bought Warner-Lambert in 2000.
- In 2007, Pfizer agreed to pay $34.7 million in fines to settle Department of Justice allegations that it improperly promoted the human growth hormone product Genotropin. The drugmaker's Pharmacia & Upjohn Co. subsidiary pleaded guilty to offering a kickback to a pharmacy-benefits manager to sell more of the drug.

Thereafter,
- Pfizer paid a $2.3 billion settlement in 2009 of civil and criminal allegations and a Pfizer subsidiary entered a guilty plea to charges it violated federal law regarding its marketing of Bextra (see post here).
- Pfizer was involved in two other major cases from then to early 2010, including one in which a jury found the company guilty of violating the RICO (racketeer-influenced corrupt organization) statute (see post here).
- The company was listed as one of the pharmaceutical "big four" companies in terms of defrauding the government (see post here).
- Pfizer's Pharmacia subsidiary settled allegations that it inflated drugs costs paid by New York in early 2011 (see post here). 
- In March, 2011, a settlement was announced in a long-running class action case which involved allegations that another Pfizer subsidiary had exposed many people to asbestos (see this story in Bloomberg).
- In October, 2011, Pfizer settled allegations that it illegally marketed bladder control drug Detrol (see this post).
- In August, 2012, Pfizer settled allegations that its subsidiaries bribed foreign (that is, with respect to the US) government officials, including government-employed doctors (see this post).
- In December, 2012, Pfizer settled federal charges that its Wyeth subsidiary deceptively marketed the proton pump inhibitor drug Protonix, using systematic efforts to deceive approved by top management, and settled charges by multiple states' Attorneys' General that it deceptively marketed Zyvox and Lyrica (see this post).
- In January, 2013, Pfizer settled Texas charges that it had misreported information to and over-billed Medicaid (see this post).
- In July, 2013, Pfizer settled charges of illegal marketing of Rapamune (see this post.)
- In April, 2014, Pfizer settled allegations of anti-trust law violations for delaying generic versions of Neurontin( see this post).
- In June, 2014, Pfizer settled another lawsuit alleging illegal marketing of Neurontin (see this post).

Years after his death, there is now a little more clarity about the clinical trial in which Dan Markingson was enrolled when he died.  Whether this clarity will have any impact remains to be seen.

We most recently posted about the aftermath of Mr Markingson's death here, (and see posts in 2013 here, and in 2011 here.)  Very briefly, Mr Markingson was an acutely psychotic patient enrolled in a drug trial sponsored by Astra Zeneca at the University of Minnesota.  His enrollment was said to be voluntary although at the time he enrolled he had been under a stayed order that could have involuntarily committed him to care.  Despite his mother's ongoing and vocal concerns that he was not doing well on the study drug and under the care of trial investigators, he continued in the trial until he died violently by his own hand.  After his death, his mother Mary Weiss, friend Mike Howard, and University of Minnesota bioethics professor Carl Elliott campaigned for a fair review of what actually happened.  University managers not only rebuffed their concerns, but harshly criticized Professor Elliott, and ended up reprimanding him for "unprofessional conduct."

Two New Reports

In the last few weeks, two new independent reports on the case appeared.  Both vindicated the concerns and questions raised by Mary Weiss, Mike Howard, and Prof Elliott.

Association for Accreditation of Human Research Protection

One, called for by the University of Minnesota faculty senate, was by the Association for Accreditation of Human Research Protection,  and said that the university left research subjects "susceptible to risks that otherwise would be avoidable" (see this Minneapolis Star-Tribune article.)  Furthermore, according to a post in the Science Insider blog from the American Association for the Advancement of Science, it said,

[T]he external review team believes the University has not taken an appropriately aggressive and informed approach to protecting subjects and regaining lost trust,

Also, it said the university has been

assuming a defensive posture. In other words, in the context of nearly continuous negative attention, the University has not persuaded its critics (from within and outside the University) that it is interested in more than protecting its reputation and that it is instead open to feedback, able to acknowledge its errors, and will take responsibility for deficiencies and their consequences.

Finally, it noted a "climate of fear" in the Department of Psychiatry.

Office of the Legislative Auditor for the State of Minnesota

The second report, available in full here,was from the Office of the Legislative Auditor for Minnesota.  If anything, it was more damning. Its summary included,

the Markingson case raises serious ethical issues and numerous conflicts of interest, which University leaders have been consistently unwilling to acknowledge. They have repeatedly claimed that clinical research at the University meets the highest ethical standards and dismissed the need for further consideration of the Markingson case by making misleading statements about past reviews. This insular and inaccurate response has seriously harmed the University of Minnesota’s credibility and reputation.

It seemed to affirm in detail nearly all of Weiss', Howard's and Elliott's concerns.  It recommended that the University should suspend new psychiatric drug trials until the problems it identified were remedied (see Star-Tribune article here.)

Vindication, but Will It Lead to Progress?  

Taken together, these reports vindicate the work of Mr Markingson's mother, friend, and academic watchdog Professor Elliott and their supporters.  As the Star-Tribune reported,

'Over the past eleven years the University of Minnesota has made us feel as if we have no voice, no rights and absolutely nothing remotely called justice,' wrote Mike Howard, a close friend to Markingson’s mother, in a letter in the audit. 'This report is the first step toward accountability.'

The Minnesota Post added the response of Professor Elliott and a colleague,

'It’s nice to have an independent confirmation of what we’ve been telling the university for five years, but which they have refused to listen to,' he told MinnPost on Thursday.

Elliott said he is not convinced, however, that Kaler and other university leaders are going to take responsibility for what happened in the Markingson case — or take the necessary steps to fix the problem going forward.

'One of the most worrying findings in the report was the widespread belief on campus that the university leadership doesn’t care about human study subjects,' he said.

Leigh Turner, another U bioethicist who has also been outspoken about the issues raised by the Markingson case, expressed similar concerns. 'Can we expect reform from the very people who have done nothing for the past several years?' he said in a phone interview.

'I hope there’s some change,' he added. 'But the fact that [Markingson died in 2004] and it’s now 2015, I think hope has to be tempered with a dose of realism. There are some very powerful forces interested in minimizing the findings and suggesting that there are only minor things that need to be done.'

It appears there a several major remaining questions.

What Were the Underlying Causes?

Although both reports went into some detail about what happened to Mr Markingson, they seemed not to dwell on why it happened.  They did not seem to address relevant contextual factors, policies, and decisions.  For example, the report by the Office of the Legislative Auditor included,

We understand that the University of Minnesota has been and should continue to be an institution that delivers not only high quality medical care but also engages in cutting edge medical research— research that does pose risks to human subjects. In addition, we do not question the appropriateness of the University obtaining money from pharmaceutical and other medical companies to support that research. However, in every medical research study—whether supported with public or private money—the University must always make the protection of human subjects its paramount responsibility.

However, as we and many others more erudite have discussed frequently, clinical research that evaluates products or services made by the commercial sponsors of the research has proven to be highly susceptible to manipulation by these sponsors to increase the likelihood that the results will serve marketing purposes, and suppression if the manipulation fails to produce the wanted results.  Commercial sponsors often strongly influence the design, implementation, analysis and dissemination of clinical research.  Often their influence is mediated by financial relationships with individual researchers and with academic institutions who seem more and more beholden to outside sponsors, that is, by conflicts of interest.  The report by the Auditor noted pressures, including financial pressures on the physician who ran the study in which Mr Markingson was a subject to enroll more patients and keep them enrolled.  To protect patients better in the future, in my humble opinion the relationships among commercial sponsors, academic medical institutions, and individual researchers need further consideration.  Is the easy money supporting research coming from commercial firms with vested interests in the outcome of that research really worth the risks of biased results, hidden results, and to research subjects?   

Will Anything Change and Will Anyone be Held Accountable?

Once these two reports were delivered, it now seems to be up to university managers to make needed changes.  In general, these are the same managers who are described above as so "defensive," who not only ignored complaints, but appeared to try to silence those who complained.  If they are left in charge, why should we expect them to make any meaningful changes?  Instead, should they  not be held accountable for their actions?  

Will the University Cease Hostilities Against Dr Elliott?

Again, as noted above, university managers did not merely disagree with Professor Elliott.  They disparaged him, appeared to try to intimidate him, and reprimanded him.  It seems at the very least he is owed an apology.  So far, nothing in the news coverage suggests he has or will receive one.

Will Anyone Notice? 

So far, this case has gotten good coverage in Minnesota media.  However, it has largely been ignored in the national media.  Beyond Minnesota, I could only find mention in some blogs, e.g., in PharmaLot by Ed Silverman, and in Forbes by Judy Stone.  I have seen nothing in any US medical or health care journal, although the British Medical Journal did cover it in a news feature.  This case clearly has global implications, and ought to be considered one of the most important cases illustrating the perils of commercially sponsored human research, but it remains proportionately anechoic.

Summary

The latest reports seem only to confirm that clinical research at major academic institutions has gone way off track.  It now seems that in their haste to bring in external funding, university administrators and the academic researchers who are beholden to them have sadly neglected the protection of their own patients.  As we have said ad infinitum, true health care reform would turn leadership of health care organizations over the people who understand and are willing to uphold the mission of health care, and particularly willing to put patients' and the public's health, and the integrity of medical education and research when applicable, ahead of the leaders' personal interests and financial gain.

ADDENDUM (25 March, 2015) - See also numerous posts by Professor Elliott on the Fear and Loathing in Bioethics blog,  by Bill Gleason in the Periodic Table blog,  and by Mickey Nardo on the 1BoringOldMan blog. 

ADDENDUM (30 March, 2015) - Note that after receiving offline comments, I changed the first paragraph to emphasize the clarity is about the trial, rather than the patient's death, and second paragraph to clarify that the order to commit was stayed.

Course on Trustworthiness of Clinical Practice Guidelines

Dr Roy Poses and Dr Wally Smith will be teaching a course on Trustworthiness of Clinical Practice Guidelines at the Annual North American meeting of the Society for Medical Decision Making, Doral, Florida, 18-22 October, 2014.

Particularly relevant to Health Care Renewal, the course will focus on reasons physicians may fail to trust clinical practice guidelines, including  concerns about the integrity of the evidence base supporting the guidelines, particularly due to manipulation and suppression of clinical research, and concerns about the guideline development process, including conflicts of interest. Furthermore, we will discuss measures that might improve the trustworthiness of the CPG development process, with emphasis on the recent report by the US Institute of Medicine, of which Dr Smith was an author.

Special Symposium on Understanding and Challenging Health Care Corruption

Dr Roy Poses and Dr Wally Smith will be presenting a special symposium,  Defense against the Dark Arts: Understanding and Challenging Health Care Corruption at the Annual Meeting of the Society for General Internal Medicine, Toronto, Ontario, Canada, 22- 25 April, 2015. 

We plan to summarize the scope of health care corruption, and discuss the impunity of those involved, and how discussion of it became taboo, before brainstorming ways to begin to challenge corruption.