The News Tribune – September 20, 2011
by Tracy Weber and Charles Ornstein; ProPublica

Despite their power to secure large settlements from drugmakers, the suits have failed to resolve the culpability of physicians

Two years ago, drugmaker Eli Lilly pleaded guilty to illegally marketing its blockbuster antipsychotic Zyprexa for elderly patients. Lilly paid $1.4 billion in criminal penalties and settlements in four civil lawsuits.

But a doctor named as a co-defendant in one suit – for allegedly taking kickbacks to prescribe the drug extensively at nursing homes – never was pursued.

Last year, Alpharma paid $42.5 million to settle federal allegations that it paid kickbacks to doctors to prescribe its painkiller Kadian.

“Health-care decisions must be based solely upon what is best for the individual patient and not on which pharmaceutical company is paying the doctor the biggest kickback,” Rod Rosenstein, U.S. attorney for the District of Maryland, said in a statement announcing the settlement.

But the doctors, accused of trading prescriptions for paid speaking gigs, faced no consequences.

At least 15 drug and medical-device companies have paid $6.5 billion since 2008 to settle accusations of marketing fraud or kickbacks. However, none of the more than 75 doctors named as participants was sanctioned, despite allegations of fraud or of conduct that put patients at risk, a review by ProPublica found.

Reporters reviewed hundreds of pages of court records and interviewed current and former federal prosecutors, state medical board officials, attorneys for whistle-blowers and, when possible, the doctors. For each doctor identified in a suit, ProPublica checked for state medical board discipline, penalties from the Medicare program and federal criminal charges.

In many of the cases, it appears that not even a cursory investigation was done to see whether the physicians had behaved inappropriately.

“Doctors have kind of gone under the radar,” said Tavy Deming, a Philadelphia lawyer who represents drug company whistle-blowers.

Amid concerns about the influence of drug company money on medicine, whistle-blower lawsuits have emerged as a headline-grabbing tool for holding manufacturers accountable.

Yet, despite their power to secure large settlements from drugmakers, the suits have failed to resolve the culpability of physicians. Doctors often are not named as defendants, even though descriptions of their alleged misconduct are used to bolster the suits. And even when settling, many companies, including Alpharma, continue to deny the allegations.

After cases are resolved, the internal company documents used as evidence remain confidential, preventing further exploration of the physicians’ behavior. Patients have no way of knowing whether their doctor’s judgment has been compromised, and doctors might be tarnished by spurious accusations.

Medical boards, which normally pursue tips or complaints of wrongdoing, do not routinely scan for such cases. Justice Department lawyers, wary of spending more time and effort on a case, say they usually are not interested in going after lesser players.

Tony West, the assistant attorney general who oversees civil litigation nationwide for the Justice Department, declined through a spokeswoman to discuss the issue. In announcing settlements with the drug companies, however, West has said that kickbacks undermine doctors’ credibility. Medical decisions, he said in one news release, should be “guided by a patient’s needs, not tainted by illegal incentives or fraud.”

Sen. Charles Grassley, Iowa, the ranking Republican on the Judiciary Committee, said in a written statement that it takes “two sides to perpetuate this fraud” and that both need to be held accountable.

“Otherwise, regardless of how big of a civil settlement a drug company makes, the incentive to cheat the taxpayers will still be in place for those willing to take part,” said Grassley, who has led investigations into conflicts of interest in medicine.

In recent years, pharmaceutical and medical-device companies have been barraged by whistle-blower lawsuits detailing how the pursuit of profit allegedly fueled fraud and corruption.

The suits are typically filed by former employees who say the companies promoted drugs for unapproved uses or paid doctors to prescribe drugs or use medical devices. The suits seek to recover millions – even billions – of dollars spent on these products by government health programs.

For Justice Department lawyers, big drug companies make attractive targets. They are flush with profits and determined to avoid crippling legal defeats. Their bureaucratic sprawl often leaves a trail of incriminating email and memos.

The massive financial settlements they are willing to pay are often modest in light of their annual sales and profits. Zyprexa, for example, had U.S. sales of nearly $3 billion in 2010. Kadian, Alpharma’s painkiller, brought in nearly $263 million, according to IMS Health, which tracks prescription drug sales.

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Minyanville
By Minyanville Staff
July 28, 2011

When the DSM-II was published in 1980, it became “the bible of psychiatry,” writes Angell, who adds, “but like the real Bible, it depended a lot on something akin to revelation. There are no citations of scientific studies to support its decisions.”

For any mental illness or passing mood swing that may trouble a person, the Diagnostic and Statistical Manual of Mental Disorders — better known as the DSM — has a label and a code. Recurring bad dreams? That may be a Nightmare Disorder, or 307.47. Narcolepsy uses the same digits in a different order: 347.00. Fancy feather ticklers? That sounds like Fetishism, or 302.81. Then there’s the ultimate catch-all for vague sadness or uneasiness, General Anxiety Disorder, or 300.02. That’s a label almost everyone can lay claim to.

These codes are used by doctors, psychologists, and regulators to maintain a mutual language; it’s a handy shorthand system for bureaucratic purposes. But over the past few decades, the staggering, ever-expanding influence of the ever-expanding DSM, which is published by the American Psychiatric Association, has also played a lead role in building wealth and off-label product uses for the major drug manufacturers. In an insightful essay in this week’s New York Review of Books, Marcia Angell, a senior lecturer in social medicine at Harvard Medical School and former Editor in Chief of The New England Journal of Medicine, explains how.

The medical director of the American Psychiatric Association (APA), Melvin Sabshin, declared in 1977 that “a vigorous effort to remedicalize psychiatry should be strongly supported."

Angell’s essay is based on a review of three current books examining the psychiatric industry: The Emperor’s New Drugs: Exploding the Antidepressant Myth, by Irving Kirsch; Anatomy of an Epidemic: Magic Bullets, Psychiatric Drugs, and the Astonishing Rise of Mental Illness in America by Robert Whitaker, and Unhinged: The Trouble with Psychiatry–A Doctor’s Revelations About a Profession in Crisis, by Daniel Carlat. She also cites the DSM-IV, the most recent edition of the manual, while her review traces big pharma’s role in our current mental disorder epidemic to the DSM-III, published in 1980.

To begin, Angell describes the psychiatric profession’s backlash against a developing perception in the 1960s and 1970s that the practice was a “soft” almost pseudo science:

In the late 1970s, the psychiatric profession struck back–hard. As Robert Whitaker tells it in Anatomy of an Epidemic, the medical director of the American Psychiatric Association (APA), Melvin Sabshin, declared in 1977 that “a vigorous effort to remedicalize psychiatry should be strongly supported,” and he launched an all-out media and public relations campaign to do exactly that. Psychiatry had a powerful weapon that its competitors lacked. Since psychiatrists must qualify as MDs, they have the legal authority to write prescriptions. By fully embracing the biological model of mental illness and the use of psychoactive drugs to treat it, psychiatry was able to relegate other mental health care providers to ancillary positions and also to identify itself as a scientific discipline along with the rest of the medical profession. Most important, by emphasizing drug treatment, psychiatry became the darling of the pharmaceutical industry, which soon made its gratitude tangible.

Of the 170 contributors to the current version of the DSM (the DSM-IV-TR), ninety-five had financial ties to drug companies, including all of the contributors to the sections on mood disorders and schizophrenia.

These efforts to enhance the status of psychiatry were undertaken deliberately. The APA was then working on the third edition of the DSM, which provides diagnostic criteria for all mental disorders. The president of the APA had appointed Robert Spitzer, a much-admired professor of psychiatry at Columbia University, to head the task force overseeing the project. The first two editions, published in 1952 and 1968, reflected the Freudian view of mental illness and were little known outside the profession. Spitzer set out to make the DSM-III something quite different. He promised that it would be “a defense of the medical model as applied to psychiatric problems,” and the president of the APA in 1977, Jack Weinberg, said it would “clarify to anyone who may be in doubt that we regard psychiatry as a specialty of medicine.”

When the DSM-II was published in 1980, it became “the bible of psychiatry,” writes Angell, who adds, “but like the real Bible, it depended a lot on something akin to revelation. There are no citations of scientific studies to support its decisions.”

Despite its lack of citations, that DSM named 265 disorders doctors were meant to identify by matching (or mostly matching) a list of symptoms in the book with symptoms described by a patient. The drug companies were quick to see this radical shift in psychiatry as an opportunity. From the 1980s until now, as Angell demonstrates, the drug makers have supported the move away from talk therapy to the drug therapy, which also benefits practitioners, since doling out drugs and tweaking prescriptions earns a psychiatrist more money for less time spent with a patient.

Here Angell explains how companies influence the DSM itself. The bold typeface is ours.

Drug companies are particularly eager to win over faculty psychiatrists at prestigious academic medical centers. Called “key opinion leaders” (KOLs) by the industry, these are the people who through their writing and teaching influence how mental illness will be diagnosed and treated. They also publish much of the clinical research on drugs and, most importantly, largely determine the content of the DSM. In a sense, they are the best sales force the industry could have, and are worth every cent spent on them. Of the 170 contributors to the current version of the DSM (the DSM-IV-TR), almost all of whom would be described as KOLs, ninety-five had financial ties to drug companies, including all of the contributors to the sections on mood disorders and schizophrenia.

The drug industry, of course, supports other specialists and professional societies, too, but Carlat asks, “Why do psychiatrists consistently lead the pack of specialties when it comes to taking money from drug companies?” His answer: “Our diagnoses are subjective and expandable, and we have few rational reasons for choosing one treatment over another.” Unlike the conditions treated in most other branches of medicine, there are no objective signs or tests for mental illness—no lab data or MRI findings—and the boundaries between normal and abnormal are often unclear. That makes it possible to expand diagnostic boundaries or even create new diagnoses, in ways that would be impossible, say, in a field like cardiology. And drug companies have every interest in inducing psychiatrists to do just that.

Eli Lilly gave $551,000 to NAMI

In addition to the money spent on the psychiatric profession directly, drug companies heavily support many related patient advocacy groups and educational organizations. Whitaker writes that in the first quarter of 2009 alone, “Eli Lilly gave $551,000 to NAMI [National Alliance on Mental Illness] and its local chapters, $465,000 to the National Mental Health Association, $130,000 to CHADD (an ADHD [attention deficit/hyperactivity disorder] patient-advocacy group), and $69,250 to the American Foundation for Suicide Prevention.”

And that’s just one company in three months; one can imagine what the yearly total would be from all companies that make psychoactive drugs. These groups ostensibly exist to raise public awareness of psychiatric disorders, but they also have the effect of promoting the use of psychoactive drugs and influencing insurers to cover them. Whitaker summarizes the growth of industry influence after the publication of the DSM-III as follows:

“In short, a powerful quartet of voices came together during the 1980’s eager to inform the public that mental disorders were brain diseases. Pharmaceutical companies provided the financial muscle. The APA and psychiatrists at top medical schools conferred intellectual legitimacy upon the enterprise. The NIMH [National Institute of Mental Health] put the government’s stamp of approval on the story. NAMI provided a moral authority.”

And now here we are in 2011, with almost everyone we know taking two or three different mood disorder drugs. (This trend is not limited to mental disorder, mind you. See Disease Branding.)

Work started on the DSM-V in 1999, which is due out in 2013. It will contain many new disorders, such as “binge eating” and “restless leg disorder.” It will also expand existing categories by tacking on words like “spectrum” to the end of a known disorder, Angell reports. “It looks as though it will be harder and harder to be normal,” she writes.

But the curtain gets pulled back further still.

In her review of Daniel Carlat’s book, Angell calls attention to the “disillusioned insider’s” frank admission that when he prescribes a drug, his decision process is largely guesswork. Carlat’s view is that although any psychiatrist will acknowledge that he or she has had great success with mental disorder drugs for say, depression or anxiety, no doctor can say with certainty whether the drugs are working or if a placebo effect has taken effect.

[Carlat's] work consists of asking patients a series of questions about their symptoms to see whether they match up with any of the disorders in the DSM. This matching exercise, he writes, provides “the illusion that we understand our patients when all we are doing is assigning them labels.” Often patients meet criteria for more than one diagnosis, because there is overlap in symptoms. For example, difficulty concentrating is a criterion for more than one disorder. One of Carlat’s patients ended up with seven separate diagnoses. “We target discrete symptoms with treatments, and other drugs are piled on top to treat side effects.” A typical patient, he says, might be taking Celexa for depression, Ativan for anxiety, Ambien for insomnia, Provigil for fatigue (a side effect of Celexa), and Viagra for impotence (another side effect of Celexa).

As for the medications themselves, Carlat writes that “there are only a handful of umbrella categories of psychotropic drugs,” within which the drugs are not very different from one another. He doesn’t believe there is much basis for choosing among them. “To a remarkable degree, our choice of medications is subjective, even random. Perhaps your psychiatrist is in a Lexapro mood this morning, because he was just visited by an attractive Lexapro drug rep.”

Messy. And, of course, the whole system is now being exported to China and other countries where the middle class is growing and the mental health industry is still in a developing stage.

Angell’s latest book is The Truth About the Drug Companies: How They Deceive Us and What to Do About It.

Read the rest of her essay, which examines the controversial use of brain chemistry drugs to treat children, here.

http://www.minyanville.com/dailyfeed/2011/07/25/harvard-expert-links-our-mental/

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CNN
By Daniel R. Levinson, Special to CNN
May 31, 2011

Daniel Levinson, inspector general for the OIG in the Department of Health and Human Services.

When a loved one moves into a nursing home, the support of family and friends is particularly important. This is especially true when the nursing home patient has dementia and can’t adequately advocate on his or her own behalf.

A newly released report from my office — the Office of the Inspector General for the Department of Health and Human Services — makes clear just how crucial it is for families to monitor and ask questions about medications that such patients receive. The report found that too often, elderly residents are prescribed antipsychotic drugs in ways that violate government standards for unnecessary drug use.

Frequently, they are prescribed in ways that don’t qualify as medically accepted for Medicare coverage. In addition, the drugs were predominately prescribed for uses that are not approved by the Food and Drug Administration.

But the most potentially troubling finding of the study is this: Researchers found that 88% of the time, these drugs were prescribed for elderly people with dementia.

This is precisely the population that faces an increased risk of death when using this class of drugs, according to the FDA. That’s why the agency puts its strongest safety warning, called a “black box warning” on these antipsychotic drugs, cautioning about the risk of death when taken by elderly people with dementia.

The report didn’t investigate why patients with dementia are prescribed antipsychotic drugs so often. But a series of lawsuits and settlements that my office helped bring about suggests that many pharmaceutical companies have improperly promoted these drugs to doctors and nursing homes for many years.

Another view: In defense of antipsychotics for dementia

The study began a few years ago, when a member of Congress questioned how many nursing home residents received a class of antipsychotic drugs introduced in the 1990s, among them risperidone and olanzapine. These drugs are known as “atypical” or “second generation” antipsychotics. They replaced the antipsychotic drugs introduced in the 1950s and 1960s to treat schizophrenia — and, incidentially, are far costlier.

The report found about 305,000 nursing home residents (about 14%) had Medicare claims for atypical antipsychotic drugs. Of these, about one in five residents was prescribed these antipsychotics in a way that violated government standards for their use. For example, residents were on a drug for too long, or at too high a dose.

Another finding: A little more than half the antipsychotic drug claims for which Medicare paid should not have been covered. Why? The claimed drugs were not used for medically accepted reasons or there were no records the drugs were actually provided.

To be clear: Most physicians and nursing homes dispense antipsychotic drugs with the best interests of patients in mind. Physicians can use their medical judgment to prescribe drugs for uses unapproved by the FDA, and also to patients for whom the boxed warning applies. Ideally, however, doctors who prescribe in such ways first determine that the benefits outweigh the risks.

Yet it remains a concern that so many elderly nursing home residents with dementia are prescribed antipsychotics. And, unfortunately, examples abound of companies’ improper promotion of these drugs.

Government investigations of Bristol-Myers Squibb, AstraZeneca and Pfizer found that they improperly promoted their antipsychotic drugs for unapproved uses.

Federal prosecution is pending against Johnson & Johnson for allegedly paying millions of dollars in kickbacks to induce Omnicare, the nation’s largest long-term care pharmacy, to recommend the use of Risperdal in treating nursing home patients, many of whom had dementia.

And Eli Lilly pleaded guilty to criminal charges associated with illegally marketing its drug Zyprexa, including to doctors who treat elderly nursing home patients.

Pharmaceutical companies have paid billions to resolve civil and criminal liabilities under federal health and safety laws. But money can’t adequately compensate for corporate campaigns that could put vulnerable, elderly patients at risk.

How do we solve this problem? There’s plenty to do.

Family members of nursing home residents must learn about their loved ones’ medications, the reasons for their use, proper dosages and possible side effects.

Nursing homes and pharmacies that serve the elderly must keep the best interests of the patient in mind when dispensing pharmaceuticals and not base the decision on the improper influence of drug companies.

Doctors, too, should rely on their best medical judgments and engage in an especially careful analysis when prescribing drugs for off-label use.

Government must combat illegal off-label promotion of these powerful and potentially lethal drugs and uphold nursing home safety standards.

And drug companies should follow the laws, and refrain from promoting drugs for unapproved uses — or paying kickbacks to influence doctors and institutions. About 46 million people are enrolled in Medicare. That will only grow as the huge baby boomer population retires. We cannot afford to leave unaddressed the urgent problem of antipsychotic drug use among elderly nursing home residents.

The opinions in this commentary are solely those of Daniel Levinson.

Read article here:  http://www.cnn.com/2011/OPINION/05/31/levinson.nursing.home.drugs/

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ThirdAge.com

by Alex Heig

Antipsychotic drugs prescribed to as many as one in seven patients with dementia at nursing homes increase the risk of death and are not approved for such uses, a government audit has found.

Drugs such as Risperdal, Zyprexa, Seroquel, Abilify and Geodon are “potentially lethal” to many of the patients getting them and in many cases, completely unnecessary and unneeded.

The Centers for Medicare and Medicaid Services said that some of the inappropriate use of antipsychotics can be attributed to drugmakers’ habit of paying kickbacks to nursing homes to increase prescriptions for the medicines.

Medicare officials said that diagnosis information is for the most part omitted from prescriptions so officials are unable to tell whether the prescription is appropriate.

The Food and Drug Administration has warned doctors of the risk of using antipsychotic drugs in elderly dementia patients, but doctors have continued the practice because of a relative lack of other options.

Doctors want to maximize quality of life by treating the patient’s agitation even if that means the patient will die a bit sooner,” said Dr. Daniel J. Carlat, editor-in-chief of The Carlat Psychiatry Report, a medical education newsletter for psychiatrists.

The results of the government audit showed that during the first six months of 2007, 304,983 elderly patients in nursing homes (out of 2.1 million total) had at least one Medicare claim for an antipsychotic medicine.

Meanwhile, 83 percent of antipsychotic prescriptions for elderly nursing home residents were for uses not approved by federal drug regulators, and 88 percent were to treat patients with dementia, for whom the drugs can be lethal.

Federal regulations prohibit any drug paid for by the government from being used for non-approved reasons. Auditors found that 51 percent of claims for antipsychotic medication violated this rule.

Additionally, the government bans drugs used in excessive duration or dose level, even for patients that qualify. Auditors found that 22 percent of claims failed to live up to this requirement.

http://www.thirdage.com/news/antipsychotic-drugs-deadly-for-elderly-patients-prescribed-anyway_05-10-2011?page=1

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The New York Times
By Gardiner Harris
May 9, 2011

Nearly one in seven elderly nursing home residents, nearly all of them with dementia, are given powerful atypical antipsychotic drugs even though the medicines increase the risks of death and are not approved for such treatments, a government audit found.

More than half of the antipsychotics paid for by the federal Medicare program in the first half of 2007 were “erroneous,” the audit found, costing the program $116 million for those six months.

“Government, taxpayers, nursing home residents as well as their families and caregivers should be outraged and seek solutions,” Daniel R. Levinson, inspector general of the Department of Health and Human Services, wrote in announcing the audit results.

Mr. Levinson noted that such drugs — which include Risperdal, Zyprexa, Seroquel, Abilify and Geodon — are “potentially lethal” to many of the patients getting them and that some drug manufacturers illegally marketed their medicines for these uses “putting profits before safety.”

The audit is an unusual assessment by the government of whether doctors are treating Medicare patients appropriately in nursing homes. Mr. Levinson suggested that the government should collect information on the diagnoses given Medicare patients so that the government can assess whether the drugs prescribed to them are appropriate.

While common in the private sector, such basic oversight is unheard of in the Medicare program and would almost certainly be opposed by doctors’ groups and many in Congress who view government intrusions into the doctor-patient relationship as inappropriate. In response to the audit, the Centers for Medicare and Medicaid Services said that some of the inappropriate use of antipsychotics in elderly nursing home patients is a result of drug makers’ paying kickbacks to nursing homes to increase prescriptions for the medicines.

Omnicare Inc., a pharmacy chain for nursing homes, paid $98 million in November 2009 to settle accusations that it received kickbacks from Johnson & Johnson and other drug makers for antipsychotic prescriptions.

Medicare officials said that diagnosis information is not generally included with prescriptions so the government cannot assess in real time whether prescription payments are appropriate.

While the Food and Drug Administration has warned doctors that using antipsychotic drugs in elderly patients with dementia increases their risks of death, doctors continue the practice because they have few other good choices, said Dr. Daniel J. Carlat, editor in chief of The Carlat Psychiatry Report, a medical education newsletter for psychiatrists.

“Doctors want to maximize quality of life by treating the patient’s agitation even if that means the patient will die a bit sooner,” Dr. Carlat said.

The government auditors found that of the 2.1 million elderly patients in nursing homes during the first six months of 2007, 304,983 had at least one Medicare claim for an antipsychotic medicine. Nursing home residents received 20 percent of the 8.5 million claims for antipsychotic medicines for all Medicare beneficiaries at a cost of $309 million during those six months.

The auditors found that 83 percent of antipsychotic prescriptions for elderly nursing home residents were for uses not approved by federal drug regulators, and 88 percent were to treat patients with dementia — for whom the drugs can be lethal.

“These results are alarming,” said Senator Charles E. Grassley, Republican of Iowa, who asked for the audit. “Medicare officials need to pay attention.”

Federal rules require that any drugs that are paid for by the government be given only for uses that are approved either by the government or one of three independent drug usage encyclopedias. Auditors found that 51 percent, or 726,000 of 1.4 million claims, for antipsychotic medicines did not meet this criterion and were thus paid for by the government improperly.

Government rules also ban drugs that are used in excessive doses or duration, even if patients are found to have a condition for which the drug is appropriate. Auditors found that 22 percent, or 317,971 of 1.4 million claims, for antipsychotic medicines failed this standard.

Read article here:  http://www.nytimes.com/2011/05/10/health/policy/10drug.html?_r=2

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McKnights – March 25, 2011

A jury in South Carolina on Tuesday found Johnson & Johnson’s pharmaceutical unit, Ortho-McNeil-Janssen, guilty of misleading doctors about the safety and effectiveness of the anti-psychotic drug Risperdal.

Janssen violated South Carolina’s consumer protection laws in 2003 when it sent a letter to roughly 7,200 doctors in the state touting the safety and effectiveness of Risperdal, the jury decided. Civil penalties could total more than $35 million, or $5,000 for each letter Janssen sent, according to a Bureau of National Affairs report. That hearing will take place April 18-19.

Johnson & Johnson has been embroiled in numerous legal battles surrounding its marketing of Risperdal. The company is alleged to have paid millions of dollars in kickbacks to pharmaceutical giant Omnicare to influence Risperdal sales to nursing home residents. The South Carolina case is one of 12 state-led cases against the company, according to BNA.

http://www.mcknights.com/the-verdict-is-in-johnson-johnson-misled-physicians-in-risperdal-marketing-campaign/article/199127/

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Ventura County Star, March 22, 2011

Associated Press

photo by Boaz Yiftach

LOS ANGELES – California has joined a whistleblower lawsuit that claims Bristol-Myers Squibb Co. bribed doctors to prescribe its drugs, costing insurers perhaps millions of dollars in the largest alleged health care fraud case ever handled by the state, Insurance Commissioner Dave Jones announced Friday.

The suit claims company salespeople plied physicians with speaking fees, expensive meals, gifts and trips to induce or reward them for prescribing large amounts of its drugs, which were billed to private insurers.

For example, the company invited doctors to attend Los Angeles Lakers games at Staples Center and spent thousands of dollars on luxury suites, the suit claimed.

“Golf outings, basketball camps, samba lessons, you name it,” Jones said at a news conference.

The lawsuit said the aim was to boost prescription levels for legally approved and so-called “off-label” uses of drugs ranging from the antipsychotic Abilify to the blood thinner Plavix.

The company is accused of setting up a speakers bureau that doled out thinly veiled kickbacks in the form of cash payments to influential or high-prescribing doctors for speaking about its products.

One doctor received a $2,500 honorarium even though he never actually spoke, Jones said.

The company denied any wrongdoing.

“Bristol-Myers Squibb believes this lawsuit has no merit and the company will defend itself vigorously,” said Laura Hortas, a company spokeswoman.

California joined a 2007 lawsuit filed by one current and two former employees of the pharmaceutical giant. If they win, the whistleblowers and the state would share damages.

The amended complaint was filed by state insurance department lawyers two weeks ago in Los Angeles Superior Court.

It’s not the first time New York-based Bristol-Myers Squibb has been accused of kickbacks by its own workers.

In 2007, the company agreed to pay $515 million to settle federal lawsuits brought by whistleblowers in Massachusetts and Florida.

The current lawsuit says the company tracked prescription figures, and low-prescribing doctors were threatened with loss of perks.

A sales plan entitled “Rounding Up the Docs!” instructed salespeople at dinner events to get physicians to commit to prescribing for specific types of patients and to monitor the number of new prescriptions by doctors. the suit states.

The company is believed to have made at least 15,000 kickbacks from 1999 to 2005, and investigators suspect that the practice is continuing, Jones said.

The cost of the alleged practice was unclear, but Jones noted the size of the previous federal settlement.

No doctors have been sued or charged with a crime because the insurance department is focusing on the company in its civil action.

The suit seeks unspecified damages that include a $10,000 fine for each prescription obtained through fraud and repayment of any profit the company made from the alleged scheme.

The investigation was continuing.

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Los Angeles Times, March 18, 2011

By Duke Helfand and Marc Lifsher

Pharmaceutical giant Bristol-Myers Squibb bribed thousands of California doctors and pharmacists to promote its drugs, using illegal kickbacks, lavish gifts and “happy hours” with the Los Angeles Lakers to expand its market share in the state, state officials said.

California Insurance Commissioner Dave Jones announced Friday that his office had joined a previously sealed whistleblower lawsuit against the company, calling it the largest health insurance fraud case ever pursued by a California state agency.

Two of the three whistleblowers in the case are former Lakers player Lucius Allen and his wife, Eve, who worked for the drug company as employees and provided access to the basketball team, whose players participated in “Lakers Dream Camps” set up by the drug company for doctors and their family members, the lawsuit said. The lawsuit was filed in 2007 but was sealed until the state joined the case recently.

New York-based Bristol-Myers Squibb issued a statement: “Bristol-Myers Squibb believes this lawsuit has no merit and the company will defend itself vigorously.”

The case is the latest major legal action against Bristol-Myers Squibb over allegations of fraud. The pharmaceutical giant paid $515 million in 2007 to settle allegations by the federal government and other states that it used a kickback scheme to defraud the Medicare and Medicaid insurance programs, officials said.

The California lawsuit alleges that Bristol-Myers Squibb targeted the private insurance industry, making thousands of payments to “high prescribing doctors” who wrote prescriptions for its well-known drugs, including Plavix, Abilify and Pravachol.

Jones said that insurance companies in California had spent more than $3.5 billion to cover the costs of the drugs Bristol-Myers Squibb sought to promote through its kickback scheme.

“We need to be sure that doctors are prescribing drugs because those drugs are best for their patients and not because a pharmaceutical company provided doctors with trips and kickbacks,” Jones said. “These illegal practices drive up the cost of health insurance for millions of Californians.”

http://www.latimes.com/business/la-fi-drug-kickbacks-20110319,0,5610786.story

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