Sunday, October 31, 2010
WSJ's Peter Loftus on GSK and Cheryl Eckard
This business of blowing the whistle on suspected health-care fraud has become, well, big business.
Yesterday the Justice Department announceddrug maker GlaxoSmithKline would pay $750 million and plead guilty to a criminal charge to settle a probe of manufacturing deficiencies at a Glaxo plant in Puerto Rico between 2001 and 2005. Those deficiencies caused pills that split apart and led to drugs with inappropriate amounts of active ingredients, which U.S. health authorities said posed safety risks. The affected drugs included the antidepressant Paxil.
But the government isn’t the only one getting paid. Cheryl Eckard, who worked as a quality-assurance manager at Glaxo until 2003, is entitled to receive at least $96 million of the settlement because she filed a lawsuit in 2004 alleging various manufacturing problems at the company. Taxpayers Against Fraud, which tracks U.S. whistleblower activity, says it’s the highest ever amount paid to a single whistleblower as part of a government false-claims settlement. (Other whistleblowers have collected tens millions of dollars in past health-care fraud settlements, and there have even been “serial” whistleblowers who have collected rewards from more than one former employer.)
Eckard’s lawsuit was filed under a provision of the False Claims Act designed to encourage people with suspected knowledge of false government claims submission to step forward. The incentive: a cut of any resulting monetary recoveries. The lawsuits are usually filed confidentially and on behalf of the U.S. The Justice Department then has the option of taking the lead in the case, using information provided in the lawsuit, which it did in Eckard’s case.
Eckard told reporters after a Boston press conference that she took no joy in knowing it took such a case to bring the company around, but that she felt it was necessary because of the patient-safety implications. “It has been a very difficult eight years for me and my family and I’m glad and relieved that it’s over.”
Her lawyer, Neil Getnick, said Eckard raised concerns internally at Glaxo before being terminated in 2003.
Glaxo said in a written statement it regrets the way the plant was operated, and that it worked hard to fully resolve the issues before the plant was closed in 2009.
It’s relatively rare that a single person collects the entire whistleblower share of single health-care fraud settlement. Several whistleblowers split about $100 million of Eli Lilly’s $1.4 billion settlement in 2009 to resolve a probe of off-label promotion of antipsychotic Zyprexa.
One of them, a former Lilly sales rep named James Wetta, went on to work for AstraZeneca andtipped off the feds about alleged off-label promotion of antipsychotic Seroquel, resulting in Astra’s $520 million settlement in April. Wetta stood to get at least $45 million of that settlement, though he was to share an undisclosed portion with another whistleblower in that case. His attorney has declined to specify the exact amounts he received.
A study published in the New England Journal of Medicine in May concluded that the median whistleblower recovery was about $3 million. While you might think that would explain why people step forward, the whistleblowers surveyed by the researchers said they didn’t do it for the money, and that they suffered personally for their actions. Personal integrity and public-health concerns were the main reported motivations.
Bring it on Eric!! Big Pharma executives facing legal threat | Philadelphia Inquirer
Frustrated that even billion-dollar fines seem to have little effect on pharmaceutical firms, the Food and Drug Administration has increasingly signaled its intent to use a legal doctrine spawned by those long-gone rodents to bring criminal charges against top executives, even those who might have been unaware of company misdeeds.
Earlier this month, Eric Blumberg, FDA litigation chief, told an industry audience that his agency was looking for cases to use what is known as the Park Doctrine as a tool to "change the corporate culture" of firms that have thus far shrugged off other penalties.
In one area the FDA is targeting are companies that have illegally promoted products for unapproved uses, a practice know as off-label marketing.
"I don't know when, where, or how many cases will be brought," Blumberg told a gathering of the Food and Drug Law Institute, "but if you are a corporate executive - or counsel advising such a client - I would not wait for the first case to decide now is the time to comply with the law. They won't get a mulligan on their conduct."
In an interview Thursday, Blumberg was pointed.
"They need to take this seriously and find out what is going on in the marketing and sales divisions of their companies," he said of pharmaceutical executives. "In my view, one thing that will get executives' attention is a few cases in which we have convicted two-legged defendants."
He singled out firms, including Pfizer Inc. and Eli Lilly & Co., that have paid multiple penalties in recent years.
Eli Lilly, for instance, was hit with a $1.4 billion fine last year for illegally marketing Zyprexa, a antipsychotic drug. The same year, Pfizer was fined $2.3 billion for illegally marketing the pain reliever Bextra. Neither company's stock price suffered significantly, leading some to conclude that even massive fines are viewed by investors and executives as simply the cost of doing business. Neither firm responded to calls for comment.
"It is clear that fines are not working here," Blumberg said. "We need to put something else on the scale to make people think twice, three times, before they promote drugs for unapproved uses."
via philly.com
Bring it on!Saturday, October 30, 2010
Introducing Prof. Dorothy Bishop's Blog
http://deevybee.blogspot.com/
Professor of Developmental Neuropsychology and a Wellcome Principal Research Fellow at the Department of Experimental Psychology in Oxford and Adjunct Professor at The University of Western Australia, Perth.
Professor of Developmental Neuropsychology and a Wellcome Principal Research Fellow at the Department of Experimental Psychology in Oxford and Adjunct Professor at The University of Western Australia, Perth.
Merck's Profit Takes Hit From Vioxx Charge - WSJ.com
Merck & Co.'s profit plunged 90% as the drug maker set aside $950 million to pay for an anticipated resolution of a government probe of its former pain drug Vioxx.
The company's earnings excluding the Vioxx charge and other items exceeded Wall Street expectations, though revenue fell short. Many drug makers have reported weaker-than-expected third-quarter revenue due to European pricing pressure and other challenges, but they have been able to offset the sluggishness with layoffs and other cost cuts.
via online.wsj.com
Health Care Renewal: THAT'S EDUCATION!
There is only one way to say it – this educational content is incompetent, reckless, and dangerous. I know both the KOLs well enough to be certain they would never develop such educational content themselves. So, who did develop it? Some functionary at PeerView Institute for Medical Education, who had no clue what s/he was doing. Compounding the problem, the Purdue University College of Pharmacy waved through this incompetent material for CME credit. If the Purdue University College of Pharmacy wants to provide continuing education for pharmacists, fine. But I draw the line at allowing an institution that does not train physicians to provide continuing education for physicians. I do not understand why this is permitted by ACCME. On the evidence of this program, the Purdue University College of Pharmacy lacks the expertise to provide continuing education for physicians.
The Last Psychiatrist: Why Zyprexa (And Other Atypical Antipsychotics) Make You Fat
October 19, 2010 1:59 AM | Posted by Anonymous: | Reply
Dopamine is a major metabolic controller. In animals dopamine along with melatonin is largely responsible for seasonal adaptation, i.e. hibernation. Human obesity is largely a hibernation response gone unchecked and chronically triggered by very high carbohyrate and abnormally decreased bright sun exposure combined with abnormal stressors (sleep deprivation and abnormal light exposure patterns - too much during sleep, not enough during wake).
In people taking zyprexa, blocking their dopamine receptors (and serotonin, and others) is making genes active that promote hibernation - they stop burning fat, stop storing fat, blood sugar increases, fertility shuts down, etc. It is no different than a hibernating animal.
In obese and diabetic humans it has been shown there is a paucity of dopaminergic signalling, and this is reversible upon glucose restriction. Downregulation of dopamine signalling is necessary to allow metabolic disorders to occur, why ? Because it is fundamentally a normal evolutionarily concerned hibernation tendency, it is only a disease in our modern society where tehse genes are being abnormally activated, chronically, year round.
Bromocriptine helps diabetes and obesity for this reason.
Regarding the observation that people on olanzapine are not using carbohydrate for energy, I would assume that is just the natural result of blocking multiple serotonin and dopamine receptors in the body - an inability, a debilitation, in using glucose for energy. This is a natural and evolutionarily conserved result of deficient neurotransmitter signaling, which again to the body signifies seasonal change and impending winter thus a hibernation-like response (metabolic conservation involving fat accrual, sleeping more, hunger, and shut down fertility).It's been known for awhile that when the body switches to using fat for energy this will result in hyperglycemia and thus compensatory hyperinsulinemia, which leads to body fat gain. When the body insists on burning fat even in the presence of carbohydrate, it could mean any number of things... 1) pathological insulin resistance due to damaged /deficient mitochondria (glucose cannot get into the cells because the mitochondria are deficient, mitochondria therefore burn fat primariliy and glucose in the blood is elevated)... 2) someone is taking a drug that induces hibernation and transient metabolic conservation (with deficient dopamine and serotonin, the body refuses to accept glucose, uses fat instead as in hibernation, body fat and blood sugar increase as it might in early fall to prepare for winter. Fertility decreases in response to decreased dopamine and serotonin as well, and infertility is a major feature of winter adaptation/hibernation in animals as it is in humans on dopamine receptor blockers.)
Eating less carbohydrate, particularly sugar, is the obvious intervention to control obesity. Even though increased fat utilization occurs during metabolic disorder, it is ultimately the glucose portion of the diet that triggers the fat storage and diabetes... or at least the WORST of it. If the body wants to use fat, then feed it fat. If you try to feed it sugar, all that will happen is your pancreas will spew out insulin and your liver will convert it to fat which is efficiently stored in adipose. If you avoid eating glucose food, the worst of this hyperglycemic/hyperinsulinemic tendency is controlled.
Regarding getting the "truth" out there...It's well known receptor blockers for psych illness make you a hibernating animal that sleeps 14 hours a day and has no motivation and weighs 300 pounds. This is not breaking news. Perhaps it would eliminate the stigma against fat schizophrenics, but that's more about social status than science anyway... the poor, uneducated, mentally ill, overweight people, how unfortunate. NO one cares.
Maybe one day, in a land far away, we will treat schizophrenia and manic depression as biological illnesses and figure out what is causing them, and ultimately resolve them... rather than just shut the brain down with receptor blockers like a chemical lobotomy.
Score: 12 (14 votes cast)
Whistleblowing - The Bearded One Speaks!
A Whistleblowing Record. In the Pipeline:: "I've written about this sort of thing before, and I continue to think that this is a good law. It takes a tremendous amount of nerve to put your own livelihood at stake to report something that's going wrong (and isn't being fixed). The incentives need to be there. If we were a perfectly altruistic species, any of us would have no problem sacrificing ourselves immediately for the good of the whole. But the very fact that there's such bad conduct to take the risk of reporting on tells you that we're not that sort of species at all.
Friday, October 29, 2010
Merck's Legal Costs for Vioxx Pill Reduce Earnings Six Years After Recall - Bloomberg
Merck & Co. set aside $950 million to resolve a criminal probe into the Vioxx painkiller it withdrew six years ago, raising potential legal costs to $7.7 billion and driving down shares today by 2.3 percent.
via bloomberg.com
Halloween Big Pharma CEO's contd.
Sanofi's Chris Viehbacher - is that Genzyme I see in the distance?
Time for a change of CEO at AstraZeneca?
Astra's shares fell 57.5p at 3188p. Analysts remain bearish on the company, with brokerage Charles Stanley noting third-quarter results had 'underwhelmed the market'.
Read more: http://www.thisismoney.co.uk/markets/article.html?in_article_id=517383#ixzz13jgs2Cqx
Read more: http://www.thisismoney.co.uk/markets/article.html?in_article_id=517383#ixzz13jgs2Cqx
FT.com - AstraZeneca patently doomed to twilight of spods
Big pharmaceuticals companies, such as Anglo-Swedish AstraZeneca, are undergoing a Twilight of the Gods. Once-haughty groups that have contributed hugely to the wealth and health of nations will diminish or even vanish.
Like Götterdämmerung, the doomy opera by Wagner (the one from Leipzig, not Dudley), the process will be lengthy and often boring. You may wish that you could slip out to the bar halfway. But the sense of predestination is compelling, as embodied in AstraZeneca’s third-quarter results published on Thursday.
Sales were off 2 per cent in constant currency terms, reflecting competition from generic drugs. Such erosion has always niggled at drugs multinationals. But increasingly, white-coated laboratory spods are not producing enough valuable new treatments as an offset.
Broker Killik & Co writes of a “patent cliff”, with monopolies supporting half of AstraZeneca’s sales expiring in the next few years. The group’s overenthusiastic promotion of the antipsychotic Seroquel, for which it was fined $520m in the US, smacked of resulting desperation.
Earnings per share dropped 26 per cent on legal provisions and cancellation of a disappointing drug project. Anyone waking from a Brunnhildean nap would be shocked by how mightily AstraZeneca has fallen. A once stratospheric prospective earnings multiple is now knee-high to dwarfish Alberich. To be fair, AstraZeneca has cut costs and expanded smartly into emerging markets. Yet its plans do not have the bravado that a slew of new blockbuster treatments would once have justified. Its strong brand will support sales of off-patent drugs in Asia, though pricing control will inevitably be less. Treatments targeted at patient subgroups – for example, non-smoking women – show promise. However, economies of scale will be low.
The missing Rhine gold for big pharma are breakthroughs to rival the small molecule world-beaters of yore. Genomics has largely flopped. Stem cell treatments are decades away from payback.
The ultimate fate of big pharma companies will probably be more prosaic than that of the Wagneri’s gods, who were barbecued by Wotan. They will become ordinary businesses reliant on marketing and accretive innovation to survive. It will be like heroic Siegfried mislaying his magic helmet and donning a bobble hat.
via ft.com
LOL
Thursday, October 28, 2010
Five GlaxoSmithKline executives who allegedly ignored Eckard believed to be still at company | Business | The Guardian
The court documents allege that Eckard, who had recommended the factory be shut until the issues were resolved, communicated the quality violations at the plant in Cidra to David Pulman, president of global manufacturing and supply; Janice Whitaker, senior vice president of global quality; Peter Savin, vice president of global quality assurance; Diane Sevigny, director of global quality assurance, risk management and compliance; and Jonathan Box, vice president of manufacturing and supply for North America.
All five executives are believed to be still working for the London-listed company, while Pulman is also a member of the company's 18-strong corporate executive team, which includes chief executive Andrew Witty.
The whistleblower's evidence states: "Eckard now believes that Whitaker, Pulman and other GSK executives were unwilling to acknowledge the gravity of the violations at the Cidra plant and to take the action that Eckard had recommended in part because the FDA had indicated that it would not consider approvals for [GSK drugs] Avandamet and Factive until [a previous FDA warning was] resolved."
It further outlines how "on or about April 2, 2003, Eckard delivered to GSK senior managers Box, Savin, Whitaker and Sevigny … a non-routine detailed memorandum on Current Compliance Risks for Manufacturing and Supply of Drug Products at Cidra … She did not receive any response to her memorandum from any of the managers."
Eckard also states that she told Sevigny "that she would not participate in a cover-up … and would not take part in any further meetings with the FDA about the Cidra plant … During this period and thereafter, Eckard and Sevigny were in frequent and increasing conflict about GSK's management of the quality and compliance problems at Cidra."
via guardian.co.uk
When vital drugs run out, patients pay the price - Health - Health care - msnbc.com
When vital drugs run out, patients pay the price - Health - Health care - msnbc.com: "“It’s disaster management, daily,” said Erin Fox, manager of the Drug Information Service at the University of Utah Health Care, who has tracked drug shortages for a decade. “The numbers are unprecedented.”
In 2005, Fox recorded 74 drug shortages in the U.S. By 2009, the number had jumped to 166. As of Sept. 10 this year, Fox had logged 150 new shortages — in addition to 30 drug shortages still unresolved and more being reported every week.
- Sent using Google Toolbar"
In 2005, Fox recorded 74 drug shortages in the U.S. By 2009, the number had jumped to 166. As of Sept. 10 this year, Fox had logged 150 new shortages — in addition to 30 drug shortages still unresolved and more being reported every week.
- Sent using Google Toolbar"
GSK whistleblower's reward is money well spent | Business | guardian.co.uk
The $96m (£60m) that Cheryl Eckard will collect as the person who blew the whistle on GlaxoSmithKline's defective manufacturing is an extraordinary sum. But the failings in Glaxo's factory in Puerto Rico (now closed) were also extraordinary. Mixed drug types and doses in the same bottle is as serious as it gets in the drug-manufacturing business.
In the circumstances, $96m doesn't look ridiculous. In the pharmaceutical industry's glory days of the 1990s, there were a number of chief executives who became multi-multi-millionaires thanks to their share options. Who's to say that Eckard's contribution to improved pharmaceutical standards was a lesser one?
The US system that entitles a whistle-blower to a portion of the fine imposed upon a company can produce these spectacular payouts, but it seems to work well. Glaxo's chief executive at the time, Jean-Pierre Garnier, ignored the phone call from a concerned Eckhard. Other chief executives are now more likely to take the call in similar circumstances. That sounds like progress.
via guardian.co.uk
AZ - Seroquel: what's the latest
The third quarter 2010 includes legal provisions totalling $473 million related to ongoing product liability litigation for Seroquel. Of the $473 million, $203 million relates to the agreements in principle that have already been reached to date to resolve more than 18,250 claims. The balance of $270 million is an additional reserve, which is the aggregate of estimates for settlement costs of outstanding US claims that have not yet been resolved and are still subject to mediation and the anticipated future defence costs associated with resolving all or substantially all of such remaining claims (see Note 5).
Sales and marketing practices
It was previously reported that AstraZeneca reached a civil settlement with the US Attorney’s Office and the state attorneys general National Medicaid Fraud Control Unit (NMFCU) to resolve an investigation relating to the marketing of Seroquel, pursuant to which the United States received $302 million plus accrued interest and participating states would receive a proportional share of up to $218 million plus accrued interest. In September 2010, AstraZeneca entered into individual settlement agreements with forty one states and Washington, DC for an aggregate amount of $210 million. The remaining states have declined to join in the settlement. AstraZeneca can reclaim the portion of the total settlement designated for the non-joining states.
Also as previously disclosed, the Commonwealth of Pennsylvania and the states of Arkansas, Montana, New Mexico, South Carolina, Mississippi and Utah have sued AstraZeneca under various state laws generally alleging that AstraZeneca made false and/or misleading statements in connection with the marketing and promotion of Seroquel. On 24 September 2010, the Commonwealth of Pennsylvania voluntarily dismissed its lawsuit.
It was previously reported that the Seroquel MDL Court dismissed a lawsuit brought by the Pennsylvania Employee Benefits Trust Fund (PEBTF) that alleged improper marketing practices relating to Seroquel and that PEBTF elected to forgo a federal appeal and instead filed an appeal with the Pennsylvania Superior Court relating to the dismissal of an earlier-filed state court action. On 25 August 2010, PEBTF voluntarily dismissed its appeal to the Pennsylvania Superior Court.
Product liability
As also previously disclosed, AstraZeneca Pharmaceuticals LP, either alone or in conjunction with one or more affiliates, has been sued in numerous individual personal injury actions involving Seroquel.
As of 27 September 2010, AstraZeneca was defending 10,471 served or answered lawsuits in the US involving 22,404 plaintiff groups. To date, approximately 2,973 additional cases have been dismissed by order or agreement and approximately 1,902 of those cases have been dismissed with prejudice. AstraZeneca is also aware of approximately 162 additional cases (approximately 3,655 plaintiffs) that have been filed but not yet served and has not determined how many additional cases, if any, may have been filed.
On 20 September 2010, the court presiding over the Delaware Seroquel litigation issued an opinion dismissing three cases on the basis that the claims were time-barred under the statute of limitations. Plaintiffs have sought reconsideration of the decision.
At present, trial dates remain pending in multiple jurisdictions, including Delaware, New Jersey, New York and the Federal District Court for the Middle District of Florida, beginning mid 2011 and continuing through 2012.
Judge Anne Conway, who is presiding over the Seroquel federal Multi-District Litigation, ordered the parties to mediate their claims with a court-appointed mediator. On 30 August 2010, the MDL Court withdrew its suggestion of remand in order to facilitate mediation progress. On 31 August 2010, the JPML vacated the conditional remand order and removed discussion of remand from the calendar for its 30 September 2010 session. AstraZeneca remains committed to a strong defence effort, but will also continue to participate in good faith in the court-ordered mediation process.
As of 27 September 2010, the mediation process has resulted in agreements in principle on monetary terms, subject to various subsequent conditions, approvals and agreement on non-monetary terms, with the attorneys representing 18,268 claimants. The specific terms of those conditional agreements in principle are by agreement, and at the request of the mediator, confidential at this time. The parties are finalising written settlement agreements in respect of the claims that have been resolved in principle. The mediation process is ongoing with regard to other claims.
During the quarter, a provision amounting to $473 million has been established in respect of the Seroquel product liability claims.
With regard to settlement agreements in principle that have been reached to date with various plaintiffs’ law firms, as of 30 September 2010, AstraZeneca has reserved $203 million to resolve 18,268 US claims. At present, we are unable to predict the precise timing of any actual payments to the settling claimants, as the agreements are likely to take several months to implement.
With regard to outstanding US claims that have not yet been resolved and are still subject to mediation, AstraZeneca has taken an additional reserve in the amount of $270 million, in the aggregate, in respect of both (a) settlement costs for those claims and (b) anticipated future defence costs (currently estimated to be over several years) associated with resolving all or substantially all of such remaining claims.
The amount of this provision is subject to a number of significant uncertainties and is based on AstraZeneca’s best estimate of: (1) the number of claims that are outstanding and may be subject to mediation (2) the financial terms of any future agreements to settle claims not subject to settlement agreements in principle at the balance sheet date and (3) the likely cost of defending those claims and finalising settlement agreements through substantial completion. Each of these estimates is subject to future adjustment based on multiple variables, such as the number of asserted claims, the success of future mediations, and further developments in the litigation. It is therefore not possible at this time to provide any reasonable indication as to when remaining claims may be settled. Furthermore, it is possible that the actual cost of ultimately settling or adjudicating the Seroquel product liability claims may differ significantly from the total amount provided.
As of 30 September 2010, legal defence costs of approximately $732 million have been incurred in connection with Seroquel-related product liability claims.
AstraZeneca has product liability insurance dating from 2003 that is considered to respond to the vast majority of the Seroquel-related product liability claims. This insurance provides cover for legal defence costs and potential damages amounts. The insurers that issued the applicable policies for 2003 have disputed coverage for Seroquel-related product liability claims on various grounds. In April 2010, AstraZeneca settled its claims against several of its insurers for legal costs incurred defending the Seroquel-related product liability claims immediately in excess of AstraZeneca’s self-insured retention of $39 million for an amount approximately equal to the receivable that had been recorded and as a result there will be no further impact on Group profit arising from this insurance settlement.
AstraZeneca currently believes that there are likely to be disputes with the remainder of its insurers about the availability of coverage under additional insurance policies. As of 30 September 2010, legal costs of approximately $117 million have been incurred in connection with Seroquel-related product liability claims which AstraZeneca believes to be covered by these additional insurance policies. However, the combined amount charged to the income statement to date in respect of legal costs and settlements which AstraZeneca believes to be covered by these additional policies, including the $473 million provision in the third quarter of 2010, now significantly exceeds the total stated upper limits of these insurance policies.
Whilst no insurance receivable can be recognised under applicable accounting standards at this time, AstraZeneca believes that it is more likely than not that further insurance recoveries will be secured under the additional policies, but there can be no assurance of this or the amount of any potential future recovery.
Sales and marketing practices
It was previously reported that AstraZeneca reached a civil settlement with the US Attorney’s Office and the state attorneys general National Medicaid Fraud Control Unit (NMFCU) to resolve an investigation relating to the marketing of Seroquel, pursuant to which the United States received $302 million plus accrued interest and participating states would receive a proportional share of up to $218 million plus accrued interest. In September 2010, AstraZeneca entered into individual settlement agreements with forty one states and Washington, DC for an aggregate amount of $210 million. The remaining states have declined to join in the settlement. AstraZeneca can reclaim the portion of the total settlement designated for the non-joining states.
Also as previously disclosed, the Commonwealth of Pennsylvania and the states of Arkansas, Montana, New Mexico, South Carolina, Mississippi and Utah have sued AstraZeneca under various state laws generally alleging that AstraZeneca made false and/or misleading statements in connection with the marketing and promotion of Seroquel. On 24 September 2010, the Commonwealth of Pennsylvania voluntarily dismissed its lawsuit.
It was previously reported that the Seroquel MDL Court dismissed a lawsuit brought by the Pennsylvania Employee Benefits Trust Fund (PEBTF) that alleged improper marketing practices relating to Seroquel and that PEBTF elected to forgo a federal appeal and instead filed an appeal with the Pennsylvania Superior Court relating to the dismissal of an earlier-filed state court action. On 25 August 2010, PEBTF voluntarily dismissed its appeal to the Pennsylvania Superior Court.
Product liability
As also previously disclosed, AstraZeneca Pharmaceuticals LP, either alone or in conjunction with one or more affiliates, has been sued in numerous individual personal injury actions involving Seroquel.
As of 27 September 2010, AstraZeneca was defending 10,471 served or answered lawsuits in the US involving 22,404 plaintiff groups. To date, approximately 2,973 additional cases have been dismissed by order or agreement and approximately 1,902 of those cases have been dismissed with prejudice. AstraZeneca is also aware of approximately 162 additional cases (approximately 3,655 plaintiffs) that have been filed but not yet served and has not determined how many additional cases, if any, may have been filed.
On 20 September 2010, the court presiding over the Delaware Seroquel litigation issued an opinion dismissing three cases on the basis that the claims were time-barred under the statute of limitations. Plaintiffs have sought reconsideration of the decision.
At present, trial dates remain pending in multiple jurisdictions, including Delaware, New Jersey, New York and the Federal District Court for the Middle District of Florida, beginning mid 2011 and continuing through 2012.
Judge Anne Conway, who is presiding over the Seroquel federal Multi-District Litigation, ordered the parties to mediate their claims with a court-appointed mediator. On 30 August 2010, the MDL Court withdrew its suggestion of remand in order to facilitate mediation progress. On 31 August 2010, the JPML vacated the conditional remand order and removed discussion of remand from the calendar for its 30 September 2010 session. AstraZeneca remains committed to a strong defence effort, but will also continue to participate in good faith in the court-ordered mediation process.
As of 27 September 2010, the mediation process has resulted in agreements in principle on monetary terms, subject to various subsequent conditions, approvals and agreement on non-monetary terms, with the attorneys representing 18,268 claimants. The specific terms of those conditional agreements in principle are by agreement, and at the request of the mediator, confidential at this time. The parties are finalising written settlement agreements in respect of the claims that have been resolved in principle. The mediation process is ongoing with regard to other claims.
During the quarter, a provision amounting to $473 million has been established in respect of the Seroquel product liability claims.
With regard to settlement agreements in principle that have been reached to date with various plaintiffs’ law firms, as of 30 September 2010, AstraZeneca has reserved $203 million to resolve 18,268 US claims. At present, we are unable to predict the precise timing of any actual payments to the settling claimants, as the agreements are likely to take several months to implement.
With regard to outstanding US claims that have not yet been resolved and are still subject to mediation, AstraZeneca has taken an additional reserve in the amount of $270 million, in the aggregate, in respect of both (a) settlement costs for those claims and (b) anticipated future defence costs (currently estimated to be over several years) associated with resolving all or substantially all of such remaining claims.
The amount of this provision is subject to a number of significant uncertainties and is based on AstraZeneca’s best estimate of: (1) the number of claims that are outstanding and may be subject to mediation (2) the financial terms of any future agreements to settle claims not subject to settlement agreements in principle at the balance sheet date and (3) the likely cost of defending those claims and finalising settlement agreements through substantial completion. Each of these estimates is subject to future adjustment based on multiple variables, such as the number of asserted claims, the success of future mediations, and further developments in the litigation. It is therefore not possible at this time to provide any reasonable indication as to when remaining claims may be settled. Furthermore, it is possible that the actual cost of ultimately settling or adjudicating the Seroquel product liability claims may differ significantly from the total amount provided.
As of 30 September 2010, legal defence costs of approximately $732 million have been incurred in connection with Seroquel-related product liability claims.
AstraZeneca has product liability insurance dating from 2003 that is considered to respond to the vast majority of the Seroquel-related product liability claims. This insurance provides cover for legal defence costs and potential damages amounts. The insurers that issued the applicable policies for 2003 have disputed coverage for Seroquel-related product liability claims on various grounds. In April 2010, AstraZeneca settled its claims against several of its insurers for legal costs incurred defending the Seroquel-related product liability claims immediately in excess of AstraZeneca’s self-insured retention of $39 million for an amount approximately equal to the receivable that had been recorded and as a result there will be no further impact on Group profit arising from this insurance settlement.
AstraZeneca currently believes that there are likely to be disputes with the remainder of its insurers about the availability of coverage under additional insurance policies. As of 30 September 2010, legal costs of approximately $117 million have been incurred in connection with Seroquel-related product liability claims which AstraZeneca believes to be covered by these additional insurance policies. However, the combined amount charged to the income statement to date in respect of legal costs and settlements which AstraZeneca believes to be covered by these additional policies, including the $473 million provision in the third quarter of 2010, now significantly exceeds the total stated upper limits of these insurance policies.
Whilst no insurance receivable can be recognised under applicable accounting standards at this time, AstraZeneca believes that it is more likely than not that further insurance recoveries will be secured under the additional policies, but there can be no assurance of this or the amount of any potential future recovery.
The "Ven-A-Care boys" aka the X-Men of health care whistleblowing
When Attorney General Mike Hatch last week announced a multimillion-dollar price-fraud lawsuit against New Jersey drug manufacturer Pharmacia Corp., he was flanked by two unfamiliar men whose deep tans suggested they weren't from around here.
In the new world of pharmaceutical litigation, Zachary Bentley, 49, T. Mark Jones, 45, and their two other business partners are emerging as the whistle-blowing equivalents of tobacco company insider Jeffrey Wigand, crusading paralegal Erin Brockovich or Minnesota FBI agent Coleen Rowley.
Without the inside knowledge of prescription-drug buying and insurance billing possessed by the "Ven-A-Care boys" as they've been called (also the "X-Men of health care"), the recent lawsuits against the giant drug companies by the federal government, Minnesota, Texas, Nevada and other states might never have been considered.
"They've been invaluable," said Ann Bildtsen, an assistant attorney general in Hatch's office.
"They're a breed apart," said attorney Carolyn McElroy, who worked with Ven-A-Care when she was president of the National Association of Medicaid Fraud Control Units.
http://www.highbeam.com/doc/1G1-87723399.html
http://pharmagossip.blogspot.com/search?q=ven-a-care
http://www.frohsinbarger.com/pdf/tlr.pdf
In the new world of pharmaceutical litigation, Zachary Bentley, 49, T. Mark Jones, 45, and their two other business partners are emerging as the whistle-blowing equivalents of tobacco company insider Jeffrey Wigand, crusading paralegal Erin Brockovich or Minnesota FBI agent Coleen Rowley.
Without the inside knowledge of prescription-drug buying and insurance billing possessed by the "Ven-A-Care boys" as they've been called (also the "X-Men of health care"), the recent lawsuits against the giant drug companies by the federal government, Minnesota, Texas, Nevada and other states might never have been considered.
"They've been invaluable," said Ann Bildtsen, an assistant attorney general in Hatch's office.
"They're a breed apart," said attorney Carolyn McElroy, who worked with Ven-A-Care when she was president of the National Association of Medicaid Fraud Control Units.
http://www.highbeam.com/doc/1G1-87723399.html
http://pharmagossip.blogspot.com/search?q=ven-a-care
http://www.frohsinbarger.com/pdf/tlr.pdf
FT.com / Companies / Pharmaceuticals - Drugmakers face rising fines and sentences
>
via ft.com
Neil Getnick, managing partner of Getnick & Getnick, the law firm that brought the action against GSK, says: “We have a very active whistleblower practice with pending actions and cases that continue to come to us. We’re talking about something here which is a trend, not an outlier.”
Tavy Deming, a partner with Kenney & McCafferty, a Pennsylvania-based law firm that brought a whistleblower suit on behalf of Stefan Kruszewski resulting in a $540m fine against AstraZeneca relating to marketing practices, argues that such large payments are justified because “reporting fraud is a risky endeavour and a black mark on your career”.
Undue influence of drug firms may find way into diagnoses - The Boston Globe
Undue influence of drug firms may find way into diagnoses - The Boston Globe: "“PRESCRIPTION FOR prestige’’ (Page A1, Oct. 19) provides data that demonstrate the need for greater oversight of relationships between the pharmaceutical industry and the academic world. There is a clear conflict of interest when doctors can parlay their academic connections into hundreds of thousands of dollars to speak about a specific drug, especially when the company that manufactures the drug gets to decide what information is disseminated. But that’s just the tip of the iceberg.
Undue industry influence may be compromising the very guidelines that doctors rely on for diagnosing and treating patients. This is because of a legal, but controversial, practice that permits researchers with financial ties to pharmaceutical companies (such as those who participate on company speakers bureaus or who receive large research grants) to serve as experts on medical guideline-writing panels.
Industry is thus allowed to have a strong voice in determining the validity of new diagnoses (for example, “attenuated psychotic symptoms syndrome’’ and “premenstrual dysphoric disorder’’) and to make recommendations about what drugs should be used to treat these disorders.
Sometimes there is questionable evidence to support the validity of new disorders, and clinical drug trials frequently yield conflicting results about the effectiveness and safety of medications. Allowing individuals who currently have, or who recently had, financial ties to industry to have such decision-making power creates an opportunity for industry to corrupt science.
Lisa Cosgrove
Cambridge
The writer, an associate professor at University of Massachusetts Boston, is currently a fellow at the Edmond J. Safra Center for Ethics at Harvard University.
Undue industry influence may be compromising the very guidelines that doctors rely on for diagnosing and treating patients. This is because of a legal, but controversial, practice that permits researchers with financial ties to pharmaceutical companies (such as those who participate on company speakers bureaus or who receive large research grants) to serve as experts on medical guideline-writing panels.
Industry is thus allowed to have a strong voice in determining the validity of new diagnoses (for example, “attenuated psychotic symptoms syndrome’’ and “premenstrual dysphoric disorder’’) and to make recommendations about what drugs should be used to treat these disorders.
Sometimes there is questionable evidence to support the validity of new disorders, and clinical drug trials frequently yield conflicting results about the effectiveness and safety of medications. Allowing individuals who currently have, or who recently had, financial ties to industry to have such decision-making power creates an opportunity for industry to corrupt science.
Lisa Cosgrove
Cambridge
The writer, an associate professor at University of Massachusetts Boston, is currently a fellow at the Edmond J. Safra Center for Ethics at Harvard University.
GSK Whistleblower's Long Journey - WSJ.com
Whistleblower's Long Journey - WSJ.com: "In 2002, drug maker GlaxoSmithKline PLC sent one of its quality-assurance managers, Cheryl Eckard, to Puerto Rico to help clean up a mess at one of its biggest manufacturing plants. U.S. authorities had just cited the plant for several violations, including making a contaminated ointment used to treat skin infections on children.
Ms. Eckard's journey from North Carolina to the Caribbean set off a chain of events culminating in this week's announcement that she would collect at least $96 million for her role in helping the government secure a criminal guilty plea and a $750 million payment from Glaxo to settle an investigation of manufacturing deficiencies.
Ms. Eckard's bounty is believed to be the largest award given to a single whistleblower in U.S. history.
Other drug companies, such as Pfizer Inc. and Eli Lilly & Co., have collectively paid billions of dollars to settle probes. Lawyers say the publicity surrounding each new settlement triggers a wave of would-be whistleblowers looking to get in on the action, leading to more substantive cases with bigger awards. Strengthened whistleblower protections also have contributed to the surge.
'The breadth of cases has expanded to include different areas we've never seen before,' said Joseph E.B. White, a Philadelphia attorney who represents whistleblowers.
Mr. White sees the focus of health-care-fraud cases expanding to allegations of manufacturing problems and the submission of false clinical-trial data to secure regulatory approval for new drugs. He also says manufacturers of medical equipment and devices are increasingly in the sights of would-be whistleblowers and government investigators. Ms. Eckard, 51 years old, wasn't available for an interview, according to her attorneys. They said she is originally from North Carolina but declined to say where she lives now, citing her privacy. She currently works as a consultant to the pharmaceutical industry on quality-assurance projects.
'This is not something I ever wanted to do, but I felt I had no choice because of the safety concerns,' Ms. Eckard said in a statement Tuesday in Boston.
Glaxo said in a statement that it regretted the way it operated the Puerto Rico plant, which has since been closed, and it's committed to continuously improving manufacturing quality. The company denied Ms. Eckard's allegations, and said her lawsuit will be dismissed as part of the settlement and payout to her. In its planned guilty plea, Glaxo agreed to admit that it sold adulterated products with the intent to defraud or mislead. A court date hasn't yet been set for Glaxo to formally enter the plea and receive sentencing.
Ms. Eckard worked at Glaxo from 1992 to 2003 and was a manager of global quality assurance at the company's Research Triangle Park, N.C., site at the time she was asked to visit the plant in Cidra, Puerto Rico.
What Ms. Eckard found when she arrived in Cidra in 2002, according to court documents, were even more problems than those cited by the U.S. Food and Drug Administration.
The plant had received complaints that drugs of different types and strengths were being mixed up in the same bottle, and plant managers had made no attempt to issue a recall or correct the cause of the mix-ups, according to a lawsuit Ms. Eckard later filed in federal court in Boston.
She learned of one consumer complaint that a boy was given double the dose of the antidepressant Paxil due to such mix-ups, according to her lawyer Neil Getnick.
Ms. Eckard made some strong recommendations to her superiors: Stop shipping all products from the plant, suspend manufacturing for two weeks to allow time to resolve the problems, and notify the FDA about the product mix-ups.
But according to her lawsuit, Ms. Eckard's recommendations were ignored because her supervisors were too busy preparing for an FDA inspection in October 2002 they hoped would clear the way for approval to market two new products, including the diabetes drug Avandamet, which was eventually approved. A Glaxo spokeswoman said two of Ms. Eckard's superiors cited in her lawsuit, who are still with the company, weren't available to comment. Others weren't reachable for comment.
Ms. Eckard continued to make trips to Cidra into 2003. She eventually told her boss that 'she would not participate in a cover-up of the quality assurance and compliance problems at Cidra,' according to her lawsuit.
Steven Eckard, Cheryl's ex-husband, said, 'I can tell you as a quality-assurance auditor she was very good at her job. She was a company person. She was not a malcontent. She was a person who really worked hard for the company up until things went sour.'
Mr. Eckard separated from Ms. Eckard in 2000, and two later divorced.
By mid-2003, Ms. Eckard was terminated in what the company called a 'redundancy' related to the merger of Glaxo Wellcome and SmithKline Beecham PLC a couple of years before.
After she left the company, she continued to try to persuade its compliance department that more needed to be done at Cidra. But she says the company took no action. Finally, in August 2003, she called the FDA's San Juan office and spent more than two hours detailing her concerns.
It was soon after that the FDA began an investigation and executed search warrants at the plant to seize documents and other potential evidence. The following year, Ms. Eckard filed a federal lawsuit against Glaxo.
Ms. Eckard's lawsuit was filed under the U.S. False Claims Act. The law, which dates back to the Civil War, prohibits people or businesses from defrauding the government, and provides incentives for people who suspect wrongdoing to come forward. Lawsuits are typically filed confidentially in federal court to protect the identity of the plaintiff. The Justice Department then determines whether the case has enough merit for it to take over.
If the Justice Department is successful in recovering money—usually through a settlement—the whistleblower is generally entitled to receive from 15% to 25% of the award.
A study published in the New England Journal of Medicine earlier this year found payouts to whistleblowers have ranged from $100,000 to $42 million per person, with a median recovery of about $3 million. Attorneys' fees however, can eat into that, ranging from 30% to 50%, according to Mr. White. Ms. Eckard's lawyers declined to say what their cut was.
Several whistleblowers split about $100 million of Eli Lilly's $1.4 billion settlement in 2009 to resolve a probe of off-label promotion of antipsychotic Zyprexa. One of them, a former Lilly sales rep named James Wetta, went on to work for AstraZeneca PLC and tipped off federal authorities about alleged off-label promotion of the antipsychotic Seroquel, resulting in Astra's $520 million settlement in April.
Mr. Wetta stood to get at least $45 million of that settlement, though he was to share an undisclosed portion with another whistleblower in that case. His attorney, Michael Mustokoff, declined to specify the exact amounts he received.
Mr. Mustokoff said Mr. Wetta has declined to be interviewed, saying most whistleblowers 'want to live anonymously and they want to enjoy their good fortune.'
—James Oberman and Jon Kamp contributed to this article.
- Sent using Google Toolbar"
Ms. Eckard's journey from North Carolina to the Caribbean set off a chain of events culminating in this week's announcement that she would collect at least $96 million for her role in helping the government secure a criminal guilty plea and a $750 million payment from Glaxo to settle an investigation of manufacturing deficiencies.
Ms. Eckard's bounty is believed to be the largest award given to a single whistleblower in U.S. history.
Other drug companies, such as Pfizer Inc. and Eli Lilly & Co., have collectively paid billions of dollars to settle probes. Lawyers say the publicity surrounding each new settlement triggers a wave of would-be whistleblowers looking to get in on the action, leading to more substantive cases with bigger awards. Strengthened whistleblower protections also have contributed to the surge.
'The breadth of cases has expanded to include different areas we've never seen before,' said Joseph E.B. White, a Philadelphia attorney who represents whistleblowers.
Mr. White sees the focus of health-care-fraud cases expanding to allegations of manufacturing problems and the submission of false clinical-trial data to secure regulatory approval for new drugs. He also says manufacturers of medical equipment and devices are increasingly in the sights of would-be whistleblowers and government investigators. Ms. Eckard, 51 years old, wasn't available for an interview, according to her attorneys. They said she is originally from North Carolina but declined to say where she lives now, citing her privacy. She currently works as a consultant to the pharmaceutical industry on quality-assurance projects.
'This is not something I ever wanted to do, but I felt I had no choice because of the safety concerns,' Ms. Eckard said in a statement Tuesday in Boston.
Glaxo said in a statement that it regretted the way it operated the Puerto Rico plant, which has since been closed, and it's committed to continuously improving manufacturing quality. The company denied Ms. Eckard's allegations, and said her lawsuit will be dismissed as part of the settlement and payout to her. In its planned guilty plea, Glaxo agreed to admit that it sold adulterated products with the intent to defraud or mislead. A court date hasn't yet been set for Glaxo to formally enter the plea and receive sentencing.
Ms. Eckard worked at Glaxo from 1992 to 2003 and was a manager of global quality assurance at the company's Research Triangle Park, N.C., site at the time she was asked to visit the plant in Cidra, Puerto Rico.
What Ms. Eckard found when she arrived in Cidra in 2002, according to court documents, were even more problems than those cited by the U.S. Food and Drug Administration.
The plant had received complaints that drugs of different types and strengths were being mixed up in the same bottle, and plant managers had made no attempt to issue a recall or correct the cause of the mix-ups, according to a lawsuit Ms. Eckard later filed in federal court in Boston.
She learned of one consumer complaint that a boy was given double the dose of the antidepressant Paxil due to such mix-ups, according to her lawyer Neil Getnick.
Ms. Eckard made some strong recommendations to her superiors: Stop shipping all products from the plant, suspend manufacturing for two weeks to allow time to resolve the problems, and notify the FDA about the product mix-ups.
But according to her lawsuit, Ms. Eckard's recommendations were ignored because her supervisors were too busy preparing for an FDA inspection in October 2002 they hoped would clear the way for approval to market two new products, including the diabetes drug Avandamet, which was eventually approved. A Glaxo spokeswoman said two of Ms. Eckard's superiors cited in her lawsuit, who are still with the company, weren't available to comment. Others weren't reachable for comment.
Ms. Eckard continued to make trips to Cidra into 2003. She eventually told her boss that 'she would not participate in a cover-up of the quality assurance and compliance problems at Cidra,' according to her lawsuit.
Steven Eckard, Cheryl's ex-husband, said, 'I can tell you as a quality-assurance auditor she was very good at her job. She was a company person. She was not a malcontent. She was a person who really worked hard for the company up until things went sour.'
Mr. Eckard separated from Ms. Eckard in 2000, and two later divorced.
By mid-2003, Ms. Eckard was terminated in what the company called a 'redundancy' related to the merger of Glaxo Wellcome and SmithKline Beecham PLC a couple of years before.
After she left the company, she continued to try to persuade its compliance department that more needed to be done at Cidra. But she says the company took no action. Finally, in August 2003, she called the FDA's San Juan office and spent more than two hours detailing her concerns.
It was soon after that the FDA began an investigation and executed search warrants at the plant to seize documents and other potential evidence. The following year, Ms. Eckard filed a federal lawsuit against Glaxo.
Ms. Eckard's lawsuit was filed under the U.S. False Claims Act. The law, which dates back to the Civil War, prohibits people or businesses from defrauding the government, and provides incentives for people who suspect wrongdoing to come forward. Lawsuits are typically filed confidentially in federal court to protect the identity of the plaintiff. The Justice Department then determines whether the case has enough merit for it to take over.
If the Justice Department is successful in recovering money—usually through a settlement—the whistleblower is generally entitled to receive from 15% to 25% of the award.
A study published in the New England Journal of Medicine earlier this year found payouts to whistleblowers have ranged from $100,000 to $42 million per person, with a median recovery of about $3 million. Attorneys' fees however, can eat into that, ranging from 30% to 50%, according to Mr. White. Ms. Eckard's lawyers declined to say what their cut was.
Several whistleblowers split about $100 million of Eli Lilly's $1.4 billion settlement in 2009 to resolve a probe of off-label promotion of antipsychotic Zyprexa. One of them, a former Lilly sales rep named James Wetta, went on to work for AstraZeneca PLC and tipped off federal authorities about alleged off-label promotion of the antipsychotic Seroquel, resulting in Astra's $520 million settlement in April.
Mr. Wetta stood to get at least $45 million of that settlement, though he was to share an undisclosed portion with another whistleblower in that case. His attorney, Michael Mustokoff, declined to specify the exact amounts he received.
Mr. Mustokoff said Mr. Wetta has declined to be interviewed, saying most whistleblowers 'want to live anonymously and they want to enjoy their good fortune.'
—James Oberman and Jon Kamp contributed to this article.
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Wednesday, October 27, 2010
GSK - Cheryl Eckard tried to warn CEO - but he wouldn't take her call!
GlaxoSmithKline whistleblower wins record £61m payout | Business | The Guardian: "A former quality control manager at GlaxoSmithKline (GSK) has received £61m, believed to be the largest ever reward for a whistleblower, after exposing a series of contamination problems at a drugs factory in Puerto Rico, and a subsequent cover-up by company bosses.
Cheryl Eckard, 51, will pocket the $96m share of a $750m criminal and civil settlement between US regulators and the British pharmaceuticals group. The case showed that the company repeatedly ignored serious failings, including allegations that staff were 'skimming' drugs to sell them on the Latin American black market and that its factory had mixed drug types and doses in the same bottle.
Eckard first warned of the numerous violations after being sent by GSK to investigate problems in the group's huge factory in Cidra, Puerto Rico, in July 2002, following a warning letter to the company from US health officials.
Over the next 10 months, she repeatedly alerted a string of GSK executives to a catalogue of breaches, only to be blocked and eventually sacked in 2003. In July of that year, Eckard phoned JP Garnier, the then chief executive, who declined to take the call to speak to her about the findings and the cover-up. Eckard, who is from North Carolina and is married with children, now works as a freelance consultant for the pharmaceutical industry.
Legal papers show that GSK employees in Cidra lied to US Food and Drug Administration (FDA) inspectors and that Eckard believes the company's executives refused to acknowledge the gravity of the violations and act, because the FDA would not consider approvals for two new treatments until the issues in the warning letter had been resolved. The two products – the diabetes treatment, Avandamet, and Factive, which is used for chest infections – were subsequently approved by the regulator.
Court documents show how Eckard was gradually sidelined, despite increasing complaints to a growing number of senior bosses.
After receiving an initial presentation in July 2002 on the plant's problems from Gloria Martinez, the quality assurance manager at Cidra, Eckard 'immediately phoned [vice president for quality, Steve] Plating at GSK's headquarters [and] recommended that GSK stop shipping all product from the Cidra plant, stop manufacturing product for two weeks in order to investigate and resolve the issues raised and the impact on released batches, and notify the FDA about the product mix-ups'.
Eckard also alerted Janice Whitaker, senior vice president for global quality, and, subsequently, David Pulman, then vice president of manufacturing and supply for North America.
After 10 weeks investigating the plant up to August 2002, Eckard – who had no authority to recall products, suspend manufacturing or report concerns to the FDA – returned to her base in North Carolina, but was sent back to Puerto Rico three weeks later to work on a 'longer-term correction' of the plant's compliance problems. However, Plating put Adalberto Ramirez, Cidra's director of laboratories, in day-to-day control of the project with Eckard only given 'an 'oversight' role'. She subsequently learned 'that Ramirez had repeatedly lied to her about the status of work' and that the 'compliance action teams' had been disbanded immediately after the FDA's October re-inspection.
That deception was also reported to Plating and to Eckard's immediate boss, Diane Sevigny. Eckard said 'that she would not participate in a cover-up ... and would not take part in any further meetings with the FDA about the Cidra plant'. The testimony continues: 'During this period and thereafter, Eckard and Sevigny were in frequent and increasing conflict about GSK's management of the quality and compliance problems at Cidra.'
The court papers also reveal how GSK employed a private investigator, who identified connections between an unnamed senior manager at Cidra and companies alleged to be distributing GSK's drugs on the black market.
By then, Eckard had been sidelined and in May 2003 she was made redundant at a meeting, during which she had her security badge confiscated and was escorted from the premises.
After being ignored by Garnier and passed to other departments, she then reported the company to the FDA in August 2003. In October, after another conversation with GSK's compliance department, the whistleblower told the regulator that the company had no intention of acting on her report, and three weeks later it was forced to announce that the FDA had begun its own investigation.
Eckard's lawsuit was filed under the False Claims Act, which is designed to allow private citizens with knowledge of fraud on the government to sue and share in the proceeds of the recovery.
In a statement, the drugs group said: 'We regret that we operated the Cidra facility in a manner that was inconsistent with current good manufacturing practice. GSK worked hard to resolve fully the manufacturing issues at the Cidra facility prior to its closure in 2009.'
However, while the company said it had received no reports of anybody becoming ill because of its failures, it declined to comment on whether further lawsuits from patients might be expected.
Eckard's lawyers, Getnick & Getnick, who said the award was the largest whistleblower penalty yet, added that the case was significant because patients cannot easily spot deficiencies with medicines. Getnick partner Lesley Ann Skillen said: 'Once the pill is swallowed, it's gone and there may be no way of telling whether someone got sick because the product was bad. As a result of this settlement and guilty plea, drug makers will now have more reason to live up to their motto that patient safety is their first priority.'
Problem plant
GlaxoSmithKline's now-closed Cidra plant, in Puerto Rico, produced the top-selling antidepressants Paxil and Paxil CR as well as the diabetes medications Avandia and Avandamet. During the period surrounding Cheryl Eckard's complaint, Paxil and Avandia were in the world's 50 top selling drug products. Other drugs affected included the chest infection treatment Factive; Bactroban ointment, an antibiotic used to treat skin infections in babies; Kytril, an anti-nausea injection for cancer patients; and Tagamet, for heartburn and peptic ulcers. Drugs of different types and strengths were found in the same bottle; Avandamet was shipped in tablets of the wrong strength; and Bactroban was 'contaminated with a micro-organism associated with bacteraemia, urinary tract infections, meningitis, wound infection, and peritonitis', court documents show.
- Sent using Google Toolbar"
Cheryl Eckard, 51, will pocket the $96m share of a $750m criminal and civil settlement between US regulators and the British pharmaceuticals group. The case showed that the company repeatedly ignored serious failings, including allegations that staff were 'skimming' drugs to sell them on the Latin American black market and that its factory had mixed drug types and doses in the same bottle.
Eckard first warned of the numerous violations after being sent by GSK to investigate problems in the group's huge factory in Cidra, Puerto Rico, in July 2002, following a warning letter to the company from US health officials.
Over the next 10 months, she repeatedly alerted a string of GSK executives to a catalogue of breaches, only to be blocked and eventually sacked in 2003. In July of that year, Eckard phoned JP Garnier, the then chief executive, who declined to take the call to speak to her about the findings and the cover-up. Eckard, who is from North Carolina and is married with children, now works as a freelance consultant for the pharmaceutical industry.
Legal papers show that GSK employees in Cidra lied to US Food and Drug Administration (FDA) inspectors and that Eckard believes the company's executives refused to acknowledge the gravity of the violations and act, because the FDA would not consider approvals for two new treatments until the issues in the warning letter had been resolved. The two products – the diabetes treatment, Avandamet, and Factive, which is used for chest infections – were subsequently approved by the regulator.
Court documents show how Eckard was gradually sidelined, despite increasing complaints to a growing number of senior bosses.
After receiving an initial presentation in July 2002 on the plant's problems from Gloria Martinez, the quality assurance manager at Cidra, Eckard 'immediately phoned [vice president for quality, Steve] Plating at GSK's headquarters [and] recommended that GSK stop shipping all product from the Cidra plant, stop manufacturing product for two weeks in order to investigate and resolve the issues raised and the impact on released batches, and notify the FDA about the product mix-ups'.
Eckard also alerted Janice Whitaker, senior vice president for global quality, and, subsequently, David Pulman, then vice president of manufacturing and supply for North America.
After 10 weeks investigating the plant up to August 2002, Eckard – who had no authority to recall products, suspend manufacturing or report concerns to the FDA – returned to her base in North Carolina, but was sent back to Puerto Rico three weeks later to work on a 'longer-term correction' of the plant's compliance problems. However, Plating put Adalberto Ramirez, Cidra's director of laboratories, in day-to-day control of the project with Eckard only given 'an 'oversight' role'. She subsequently learned 'that Ramirez had repeatedly lied to her about the status of work' and that the 'compliance action teams' had been disbanded immediately after the FDA's October re-inspection.
That deception was also reported to Plating and to Eckard's immediate boss, Diane Sevigny. Eckard said 'that she would not participate in a cover-up ... and would not take part in any further meetings with the FDA about the Cidra plant'. The testimony continues: 'During this period and thereafter, Eckard and Sevigny were in frequent and increasing conflict about GSK's management of the quality and compliance problems at Cidra.'
The court papers also reveal how GSK employed a private investigator, who identified connections between an unnamed senior manager at Cidra and companies alleged to be distributing GSK's drugs on the black market.
By then, Eckard had been sidelined and in May 2003 she was made redundant at a meeting, during which she had her security badge confiscated and was escorted from the premises.
After being ignored by Garnier and passed to other departments, she then reported the company to the FDA in August 2003. In October, after another conversation with GSK's compliance department, the whistleblower told the regulator that the company had no intention of acting on her report, and three weeks later it was forced to announce that the FDA had begun its own investigation.
Eckard's lawsuit was filed under the False Claims Act, which is designed to allow private citizens with knowledge of fraud on the government to sue and share in the proceeds of the recovery.
In a statement, the drugs group said: 'We regret that we operated the Cidra facility in a manner that was inconsistent with current good manufacturing practice. GSK worked hard to resolve fully the manufacturing issues at the Cidra facility prior to its closure in 2009.'
However, while the company said it had received no reports of anybody becoming ill because of its failures, it declined to comment on whether further lawsuits from patients might be expected.
Eckard's lawyers, Getnick & Getnick, who said the award was the largest whistleblower penalty yet, added that the case was significant because patients cannot easily spot deficiencies with medicines. Getnick partner Lesley Ann Skillen said: 'Once the pill is swallowed, it's gone and there may be no way of telling whether someone got sick because the product was bad. As a result of this settlement and guilty plea, drug makers will now have more reason to live up to their motto that patient safety is their first priority.'
Problem plant
GlaxoSmithKline's now-closed Cidra plant, in Puerto Rico, produced the top-selling antidepressants Paxil and Paxil CR as well as the diabetes medications Avandia and Avandamet. During the period surrounding Cheryl Eckard's complaint, Paxil and Avandia were in the world's 50 top selling drug products. Other drugs affected included the chest infection treatment Factive; Bactroban ointment, an antibiotic used to treat skin infections in babies; Kytril, an anti-nausea injection for cancer patients; and Tagamet, for heartburn and peptic ulcers. Drugs of different types and strengths were found in the same bottle; Avandamet was shipped in tablets of the wrong strength; and Bactroban was 'contaminated with a micro-organism associated with bacteraemia, urinary tract infections, meningitis, wound infection, and peritonitis', court documents show.
- Sent using Google Toolbar"
Astrazeneca workers agree to suspend pensions protest - Wilmslow Express
Astrazeneca workers have agreed to suspend their five week protest over pension schemes so 'calm' talks with AZ bosses can take place.The GMB has agreed to halt the industrial action, which has included seven days of strikes and a ban on overtime, until a formal meeting takes place on Monday.
In a letter to union members, Neil Holder GMB regional officer said he hopes the meeting will resolve the dispute.
via menmedia.co.uk
Tales From the PMCPA - The case of the hidden hand
On 20 March, the BMJ published an article entitled ‘Generic drugs: protest group was not quite what it seemed’. In accordance with the Authority’s Constitution and Procedure, the matter was taken up with Norgine as a complaint by the Director.
The article was about an alleged lack of transparency with regard to Norgine’s role in the publication of a letter in The Times (24 February). The letter was headed ‘Patient wellbeing at risk from substituted generic medicines’. The article claimed that the letter, which had been signed by several doctors and representatives of patient groups, decried generics and pleaded for doctors’ choice to prescribe branded drugs to be paramount. The letter was written in response to the Department of Health’s (DoH’s) consultation on prescribing which proposed automatic generic substitution. The article claimed that Norgine considered that it would be under direct threat as a result of increased use of generics.
The author of the article in the BMJ stated that far from being a spontaneous protest from a group of patients and health professionals, the letter to The Times had been coordinated by a public relations (PR) agency on behalf of Norgine. The article alleged that the agency had searched the published literature for articles written in support of prescribing branded medicines and then invited the authors of those articles to sign a letter protesting against generic substitution. The article stated, however, that the chief operating officer of Norgine did not add his name to the list of signatories.
There seemed to be a lack of transparency.
The author further noted that the letter in The Times had been signed on behalf of three patient organisations which received funding from various pharmaceutical companies and some of the doctors who had signed the letter also advised pharmaceutical companies or received research funding from them.
The detailed response from Norgine is given below.
The Panel first had to decide whether or not the matter was subject to the Code. The Code applied to the promotion of medicines to health professionals and to appropriate administrative staff. The Code also applied to certain areas that were non-promotional, including the provision of information to the public about prescription only medicines. The Code defined promotion and stated that the term promotion did not include information relating to human health or diseases provided there was no reference either direct or indirect, to specific medicines.
The Panel noted that the letter in question referred to prescribed medicines, it focussed on differences between branded and generic medicines and the possible adverse effects on patient wellbeing if pharmacists could automatically substitute a generic medicine even if the doctor had written a prescription for a specific brand. The letter was signed by senior figures from several patient organisations, individual health professionals and others including a previous Director General of the ABPI. No medicine was mentioned by name or unique identifying feature. The Panel noted that it might be argued that the removal of automatic generic substitution would benefit companies by increasing/maintaining the use of branded products ie it would promote the prescription, supply, sale or administration of their medicines. However, given the intended audience, the public, and the content of the letter in question, the Panel decided that the letter to The Times was not 'promotion' as defined in the Code. The letter referred a number of times to prescribing and although not explicitly solely about prescription only medicines such medicines would be covered by the letter. Thus, although not promotional, the Panel considered that the letter was subject to the Code as it was information about prescription only medicines aimed at the public.
The Panel noted that the Code required that material relating to medicines and their uses, whether promotional in nature or not, which was sponsored by a pharmaceutical company must clearly indicate that it had been sponsored by that company. The supplementary information required a declaration to reflect the nature of the company’s involvement. The Code did not specifically mention lobbying activities but in the Panel’s view if such activities resulted in materials relating to medicines and their uses then the Code applied. In the Panel’s view the letter to The Times in contrasting branded and generic medicines clearly referred to medicines and their uses. Norgine’s role in the development and production of the letter meant that it was responsible for it under the Code and that Norgine had sponsored the letter. The Code required transparency about pharmaceutical company activities so that readers of the material were aware of such involvement.
The Panel noted Norgine’s submission that all of the signatories to the letter knew about Norgine’s role in the development and production of the letter. In the Panel’s view it was equally important that those reading the published letter were also aware of Norgine’s role. There was no mention of Norgine either in the published letter itself or as a signatory to the letter. Nor was there any indication of any pharmaceutical company involvement. In the Panel's view the majority of those reading the letter in The Times would have viewed it differently if they had known that it had been sponsored by a pharmaceutical company with an interest in the views expressed. The Panel considered that by not making its role clear Norgine had failed to comply with the Code and a breach was ruled. The Panel considered that Norgine had therefore failed to maintain high standards and a further breach was ruled.
The Panel noted that every case had to be considered on its own merits. The Code covered pharmaceutical company relationships with patient organisations and applied to patient organisations and the like when such activities were supported by pharmaceutical companies. In this case the campaign in question was initiated and funded by Norgine. The suggestion that a letter be written to The Times, signed by clinicians and patient group representatives, had come from a company-organised roundtable meeting of key journalists to gather their views on how awareness of the issues involved could be raised amongst the general public. Potential signatories to the letter were identified by Norgine or its PR agency; some had been previously identified to sign a consensus document whilst others were contacted only to sign the letter. The Panel noted that where the letter was signed by individuals from patient organisations the organisation was also named and the signatory’s position within the organisation stated ie Chair, President, etc. Individuals with no stated involvement with patient organisations had also signed the letter. The Panel queried whether the letter was developed and produced as a result of a formal interaction between Norgine and the patient organisations or as a more personal interaction with individuals operating wholly independently from their patient organisation. However, as patient organisations were named, and the senior position of each signatory within the organisation given, there was an implication that each organisation formally endorsed the letter. This would certainly be the impression given to readers. Readers would not know from the published letter that a pharmaceutical company was also involved. The Panel considered that Norgine had not made its involvement with the patient organisations named in the letter clear. The Panel ruled a breach of the Code. The Code required wording to accurately reflect the nature of a pharmaceutical company's involvement in the declaration of sponsorship and, in the context of relationships with patient organisations, covered all material sponsored by a pharmaceutical company.
Norgine's role in the development and production of the published letter was not clear and a breach of the Code was ruled.
Upon appeal by Norgine, the Appeal Board noted that the letter in question referred to prescribed medicines, it focussed on differences between branded and generic medicines and what might happen to patients if pharmacists could automatically substitute a generic medicine even if a specific brand had been prescribed. No medicine was mentioned by name or unique identifying feature. The letter referred a number of times to prescribing and although not explicitly solely about prescription only medicines such medicines would be covered by the letter. Thus, the Appeal Board considered that the letter was subject to the Code as it was information about prescription only medicines aimed at the public.
The letter to The Times, in contrasting branded and generic medicines, clearly referred to medicines and their uses. The letter had been written as a direct result of a campaign orchestrated by Norgine. Norgine had underwritten the costs of the letter being written. The Code required transparency about pharmaceutical company activities so that readers of the material were aware of any such involvement. The letter itself did not refer to Norgine’s involvement and no one from Norgine had signed the letter. In the Appeal Board's view those reading the letter in The Times should have been able to do so in the knowledge that a pharmaceutical company with a vested interest had been involved in its creation. Disclosure in this regard would have allowed the reader to form his own fully informed opinion of the views expressed. The Appeal Board considered that by not making its role clear Norgine had failed to comply with the Code and it upheld the Panel’s ruling of a breach.
The campaign in question was initiated and funded by Norgine. The suggestion that a letter be written to The Times, signed by clinicians and patient organisation representatives, had come from a company-organised roundtable meeting of key journalists to gather their views on how awareness of the issues involved could be raised amongst the general public. Potential signatories to the letter were identified by Norgine or its PR agency; some had been previously identified to sign a consensus document whilst others were contacted only to sign the letter. The Appeal Board noted from Norgine’s representatives at the appeal that each signatory chose which title to use when signing the letter; some chose to refer to their role in a named patient organisation ie Chair, President, etc. Individuals with no stated involvement with patient organisations had also signed the letter. The Appeal Board considered that as patient organisations were named, and the senior position of each signatory within the organisation given, readers would assume that each organisation formally endorsed the letter. The Appeal Board considered that in any event, by deliberately not providing any indication of its involvement with the production of the letter, Norgine had not made its involvement with the patient organisations noted in the letter clear to those reading it. The Appeal Board upheld the Panel’s ruling of a breach of the Code.
The Appeal Board considered that the Code required wording to accurately reflect the nature of a pharmaceutical company's involvement in the declaration of sponsorship from the outset. Norgine's role in the development and production of the letter was not made clear to readers of The Times. The Appeal Board upheld the Panel’s ruling of a breach of the Code.
The Appeal Board noted that the letter was directed at the public and thus it was important that the public were fully informed as to who was behind it; Norgine, by not declaring its involvement in the creation of the letter had therefore failed to maintain high standards and the Appeal Board upheld the Panel’s ruling of a breach of the Code.
http://www.pmcpa.org.uk/files/2308%2027%20October.pdf
The article was about an alleged lack of transparency with regard to Norgine’s role in the publication of a letter in The Times (24 February). The letter was headed ‘Patient wellbeing at risk from substituted generic medicines’. The article claimed that the letter, which had been signed by several doctors and representatives of patient groups, decried generics and pleaded for doctors’ choice to prescribe branded drugs to be paramount. The letter was written in response to the Department of Health’s (DoH’s) consultation on prescribing which proposed automatic generic substitution. The article claimed that Norgine considered that it would be under direct threat as a result of increased use of generics.
The author of the article in the BMJ stated that far from being a spontaneous protest from a group of patients and health professionals, the letter to The Times had been coordinated by a public relations (PR) agency on behalf of Norgine. The article alleged that the agency had searched the published literature for articles written in support of prescribing branded medicines and then invited the authors of those articles to sign a letter protesting against generic substitution. The article stated, however, that the chief operating officer of Norgine did not add his name to the list of signatories.
There seemed to be a lack of transparency.
The author further noted that the letter in The Times had been signed on behalf of three patient organisations which received funding from various pharmaceutical companies and some of the doctors who had signed the letter also advised pharmaceutical companies or received research funding from them.
The detailed response from Norgine is given below.
The Panel first had to decide whether or not the matter was subject to the Code. The Code applied to the promotion of medicines to health professionals and to appropriate administrative staff. The Code also applied to certain areas that were non-promotional, including the provision of information to the public about prescription only medicines. The Code defined promotion and stated that the term promotion did not include information relating to human health or diseases provided there was no reference either direct or indirect, to specific medicines.
The Panel noted that the letter in question referred to prescribed medicines, it focussed on differences between branded and generic medicines and the possible adverse effects on patient wellbeing if pharmacists could automatically substitute a generic medicine even if the doctor had written a prescription for a specific brand. The letter was signed by senior figures from several patient organisations, individual health professionals and others including a previous Director General of the ABPI. No medicine was mentioned by name or unique identifying feature. The Panel noted that it might be argued that the removal of automatic generic substitution would benefit companies by increasing/maintaining the use of branded products ie it would promote the prescription, supply, sale or administration of their medicines. However, given the intended audience, the public, and the content of the letter in question, the Panel decided that the letter to The Times was not 'promotion' as defined in the Code. The letter referred a number of times to prescribing and although not explicitly solely about prescription only medicines such medicines would be covered by the letter. Thus, although not promotional, the Panel considered that the letter was subject to the Code as it was information about prescription only medicines aimed at the public.
The Panel noted that the Code required that material relating to medicines and their uses, whether promotional in nature or not, which was sponsored by a pharmaceutical company must clearly indicate that it had been sponsored by that company. The supplementary information required a declaration to reflect the nature of the company’s involvement. The Code did not specifically mention lobbying activities but in the Panel’s view if such activities resulted in materials relating to medicines and their uses then the Code applied. In the Panel’s view the letter to The Times in contrasting branded and generic medicines clearly referred to medicines and their uses. Norgine’s role in the development and production of the letter meant that it was responsible for it under the Code and that Norgine had sponsored the letter. The Code required transparency about pharmaceutical company activities so that readers of the material were aware of such involvement.
The Panel noted Norgine’s submission that all of the signatories to the letter knew about Norgine’s role in the development and production of the letter. In the Panel’s view it was equally important that those reading the published letter were also aware of Norgine’s role. There was no mention of Norgine either in the published letter itself or as a signatory to the letter. Nor was there any indication of any pharmaceutical company involvement. In the Panel's view the majority of those reading the letter in The Times would have viewed it differently if they had known that it had been sponsored by a pharmaceutical company with an interest in the views expressed. The Panel considered that by not making its role clear Norgine had failed to comply with the Code and a breach was ruled. The Panel considered that Norgine had therefore failed to maintain high standards and a further breach was ruled.
The Panel noted that every case had to be considered on its own merits. The Code covered pharmaceutical company relationships with patient organisations and applied to patient organisations and the like when such activities were supported by pharmaceutical companies. In this case the campaign in question was initiated and funded by Norgine. The suggestion that a letter be written to The Times, signed by clinicians and patient group representatives, had come from a company-organised roundtable meeting of key journalists to gather their views on how awareness of the issues involved could be raised amongst the general public. Potential signatories to the letter were identified by Norgine or its PR agency; some had been previously identified to sign a consensus document whilst others were contacted only to sign the letter. The Panel noted that where the letter was signed by individuals from patient organisations the organisation was also named and the signatory’s position within the organisation stated ie Chair, President, etc. Individuals with no stated involvement with patient organisations had also signed the letter. The Panel queried whether the letter was developed and produced as a result of a formal interaction between Norgine and the patient organisations or as a more personal interaction with individuals operating wholly independently from their patient organisation. However, as patient organisations were named, and the senior position of each signatory within the organisation given, there was an implication that each organisation formally endorsed the letter. This would certainly be the impression given to readers. Readers would not know from the published letter that a pharmaceutical company was also involved. The Panel considered that Norgine had not made its involvement with the patient organisations named in the letter clear. The Panel ruled a breach of the Code. The Code required wording to accurately reflect the nature of a pharmaceutical company's involvement in the declaration of sponsorship and, in the context of relationships with patient organisations, covered all material sponsored by a pharmaceutical company.
Norgine's role in the development and production of the published letter was not clear and a breach of the Code was ruled.
Upon appeal by Norgine, the Appeal Board noted that the letter in question referred to prescribed medicines, it focussed on differences between branded and generic medicines and what might happen to patients if pharmacists could automatically substitute a generic medicine even if a specific brand had been prescribed. No medicine was mentioned by name or unique identifying feature. The letter referred a number of times to prescribing and although not explicitly solely about prescription only medicines such medicines would be covered by the letter. Thus, the Appeal Board considered that the letter was subject to the Code as it was information about prescription only medicines aimed at the public.
The letter to The Times, in contrasting branded and generic medicines, clearly referred to medicines and their uses. The letter had been written as a direct result of a campaign orchestrated by Norgine. Norgine had underwritten the costs of the letter being written. The Code required transparency about pharmaceutical company activities so that readers of the material were aware of any such involvement. The letter itself did not refer to Norgine’s involvement and no one from Norgine had signed the letter. In the Appeal Board's view those reading the letter in The Times should have been able to do so in the knowledge that a pharmaceutical company with a vested interest had been involved in its creation. Disclosure in this regard would have allowed the reader to form his own fully informed opinion of the views expressed. The Appeal Board considered that by not making its role clear Norgine had failed to comply with the Code and it upheld the Panel’s ruling of a breach.
The campaign in question was initiated and funded by Norgine. The suggestion that a letter be written to The Times, signed by clinicians and patient organisation representatives, had come from a company-organised roundtable meeting of key journalists to gather their views on how awareness of the issues involved could be raised amongst the general public. Potential signatories to the letter were identified by Norgine or its PR agency; some had been previously identified to sign a consensus document whilst others were contacted only to sign the letter. The Appeal Board noted from Norgine’s representatives at the appeal that each signatory chose which title to use when signing the letter; some chose to refer to their role in a named patient organisation ie Chair, President, etc. Individuals with no stated involvement with patient organisations had also signed the letter. The Appeal Board considered that as patient organisations were named, and the senior position of each signatory within the organisation given, readers would assume that each organisation formally endorsed the letter. The Appeal Board considered that in any event, by deliberately not providing any indication of its involvement with the production of the letter, Norgine had not made its involvement with the patient organisations noted in the letter clear to those reading it. The Appeal Board upheld the Panel’s ruling of a breach of the Code.
The Appeal Board considered that the Code required wording to accurately reflect the nature of a pharmaceutical company's involvement in the declaration of sponsorship from the outset. Norgine's role in the development and production of the letter was not made clear to readers of The Times. The Appeal Board upheld the Panel’s ruling of a breach of the Code.
The Appeal Board noted that the letter was directed at the public and thus it was important that the public were fully informed as to who was behind it; Norgine, by not declaring its involvement in the creation of the letter had therefore failed to maintain high standards and the Appeal Board upheld the Panel’s ruling of a breach of the Code.
http://www.pmcpa.org.uk/files/2308%2027%20October.pdf
GSK - Cheryl Eckard speaks
Carolina native Cheryl Eckard came to the federal courthouse in Boston on Tuesday and left $96 million richer -- her share as a company whistleblower of a $750 million penalty paid by GlaxoSmithKline over a subsidiary's drug-manufacturing lapses in Puerto Rico.
"I'm a little emotional, so you'll have to forgive me for that,'' Eckard, 51, who grew up near Raleigh, said as she spoke to reporters after federal officials announced the penalty. "This is not something I ever wanted to do.''
Yes, she is now a multimillionaire -- but after the former Glaxo quality-assurance manager complained repeatedly to superiors about drug plant lapses at a manufacturing site she oversaw in Cidra, Puerto Rico, she got fired in June 2003. Represented by attorneys Neil V. Getnick and Leslie Ann Skillen of Getnick & Getnickin New York, she's been fighting ever since 2004 in court until GlaxoSmithKline finally agreed Tuesday to plead guilty and pay the $750 million in fines, penalties, and settlements. The Getnick firm believes Eckard's award is the single-biggest U.S. whistleblower award in history.
"I think it's very, very difficult to survive this,'' Eckard said. "It's difficult to survive this financially, emotionally, you lose all your friends, because all your friends are people you have at work.'' But she added: "You really do have to understand that it's a very difficult process, but very well worth it.''
The $750 million and guilty plea from Glaxo resolve allegations that drugs made at its former SB Pharmco Puerto Rico plant -- including a controlled-release version of its antidepressant Paxil and Type II diabetes treatment Avandamet -- may have been contaminated or made above or below the properly calibrated dosage.
"We will not tolerate corporate attempts to profit at the expense of the ill and needy in our society,'' said Carmen Ortiz, U.S. Attorney for Massachusetts, at a press event Tuesday announcing the resolution. She said the government was not aware of anyone getting sick because of the Glaxo drugs in question, but said it was critical to sound a strong message that the government will not tolerate any lapses in safety standards for pharmaceutical manufacturers.
Highly profitable GlaxoSmithKline manufactured hundreds of millions of dollars worth of pharmaceuticals at the Cidra plant between 2001 and 2005, the time period covered by the legal actions. So I asked Ortiz how the $750 million penalty compared to Glaxo's net income -- in other words, could wrongdoing have turned out to be on net profitable? "The fine is significantly higher than the profits that were made by the company,'' Ortiz said, not offering any more specific numbers.
Glaxo had disclosed on July 15 was taking a $750 million charge in anticipation of the fine. GSK senior vice president P.D. Villarreal said in a statement: "We regret that we operated the Cidra facility in a manner that was inconsistent with current Good Manufacturing Practice requirements and with GSK's commitment to manufacturing quality. GSK worked hard to resolve fully the manufacturing issues at the Cidra facility prior to its closure in 2009 and we are committed to continuous improvement in our manufacturing processes. Our commitment to compliance with cGMP is demonstrated by the fact that we have not received an FDA warning letter at any plant since the Cidra facility was cited in July 2002.''
While $750 million is an eye-popping sum for a company to pay after a government legal action, it's not the biggest pharma fine in U.S. history, or the second, or the third -- but the fourth, according to Tony West, assistant U.S. attorney general in the civil division. The biggest is the $2.3 billion Pfizer agreed to pay in the summer of 2009 for improperly marketing Pfizer drugs as treatments not authorized by the government.
Cheryl Eckard hopes for all she's lost -- and won -- she may inspire others who see lapses to fight for what's right. "You have to believe in your heart this this is the right thing ... In my case, I was very, very concerned about patient safety.''
Her giant payday came about from a law dating to the days of Abraham Lincoln, the False Claims Act, which allows private citizens who know of fraud on the government -- in this case, government health programs paying for Glaxo drugs that turned out to be impure or sub-potent or with improperly calibrated dosages -- to sue and if their charges, reap typically 15 to 20 percent of what the government recoups. Whistleblower laws current also encourage private citizens to get involved in -- and get bounties for -- government prosecutions of tax, securities, and commodities fraud, and other kinds of fraud against federal and state government agencies.
Several states are sharing in the $750 million, including Massachusetts, which will get $8 million for its Medicaid program from Glaxo, according to state Attorney General Martha Coakley.
PLoS Medicine: Conflicts of Interest at Medical Journals: The Influence of Industry-Supported Randomised Trials on Journal Impact Factors and Revenue – Cohort Study
PLoS Medicine: Conflicts of Interest at Medical Journals: The Influence of Industry-Supported Randomised Trials on Journal Impact Factors and Revenue – Cohort Study: "Publication of industry-supported trials was associated with an increase in journal impact factors. Sales of reprints may provide a substantial income. We suggest that journals disclose financial information in the same way that they require them from their authors, so that readers can assess the potential effect of different types of papers on journals' revenue and impact.
Cheryl Eckard - "a role model for whistleblowers" gets $96 million
BOSTON, Oct 26, 2010 (BUSINESS WIRE) -- GlaxoSmithKline (GSK) has agreed to pay the government $750 million to settle civil and criminal charges that it manufactured and sold adulterated drug products to Medicaid and other government health plans, the Department of Justice announced today. The settlement was the result of a whistleblower lawsuit filed in 2004 by the law firm of Getnick & Getnick LLP on behalf of Cheryl Eckard, a former Quality Assurance Manager with GSK.
This is a groundbreaking case, the first time the whistleblower law has been successfully used to hold drug makers accountable for violations of government manufacturing standards. The civil settlement of $600 million resolves charges that GSK released to the market Bactroban ointment, a topical antibiotic used to treat skin infections in babies, that contained microorganisms and Kytril injection, an anti-nausea drug used by cancer patients, that was not sterile. The settlement also covers the release of Paxil CR tablets that lacked the active ingredient and Avandamet tablets that were superpotent and subpotent. Paxil CR is an anti-depressant and Avandamet is a derivative of the diabetes drug Avandia. GSK also paid a criminal fine of $150 million.
GSK reached the settlement with the U.S. Attorney's Office in Boston after more than six years of investigation and negotiations, which began when Ms. Eckard reported GSK's fraud to the FDA and filed a qui tam whistleblower lawsuit. This law allows a private citizen with knowledge of fraud on the government to sue on the government's behalf and receive a share of the proceeds. Ms. Eckard was fired by GSK in 2003 after repeatedly complaining to management about conditions at its former top-producing plant in Cidra, Puerto Rico.
"The success of this whistleblower lawsuit will change the way that drug companies run their factories," said Neil Getnick, managing partner of the Getnick firm. "Now every employee who works with manufacturing issues -- from quality assurance executives like Cheryl Eckard to machine operators -- has a viable option if they have evidence that management is putting profits ahead of patient safety by letting bad products out the door."
"Drug manufacturing is vulnerable to abuse because consumers can't see the defects," said Getnick partner Lesley Ann Skillen. "Once the pill is swallowed, it's gone and there may be no way of telling whether someone got sick because the product was bad. As a result of this settlement and guilty plea, drug makers will now have more reason to live up to their motto that patient safety is their first priority."
In August 2002, Ms. Eckard, then a Global Quality Assurance Manager with GSK, was sent to the Cidra factory to lead a team of 100 scientists and quality experts brought from around the globe to fix manufacturing violations cited by the FDA. Cidra was then GSK's No. 1 factory in the world, making over 20 products worth $5.5 billion annually, including blockbuster drugs Avandia, Paxil and Coreg.
What she discovered went far beyond the manufacturing violations previously uncovered by the FDA. Her whistleblower lawsuit, filed by the Getnick firm in February 2004, included details about mixed-up products, super and subpotent diabetes drugs, an area of the factory used to make injectible drugs that was not sterile, air handling systems that misdirected the flow of product powders, a water system contaminated with microorganisms, and a host of other manufacturing and quality testing problems that led her to conclude that GSK could not assure that its product was free from contamination and made according to the drug formula registered with the FDA.
From August 2002 to her firing in May 2003, Ms. Eckard urged GSK managers to take swift and decisive action at Cidra, including shutting down the plant. She made a full report to the GSK Compliance Department, which treated her complaints as unsubstantiated. She then reported the fraud to the FDA in San Juan.
The FDA executed search warrants in October 2003 and in February 2005 seized all stocks of Avandamet and Paxil CR in the largest seizure in FDA history, estimated by the FDA to be worth $2 billion. The FDA also placed the Cidra plant under a Consent Decree, requiring that all products released to the market be approved by an independent monitor. The Cidra plant closed in 2009.
"Cheryl Eckard is a role model for whistleblowers," said Skillen. "Cheryl and our firm worked with the government and established a true public-private partnership. This result is a great credit to the vision and talent of the government's team in the Boston U.S. Attorneys Office, the Department of Justice, the VA, FDA, FBI, HHS, DCIS, OPM and other federal agencies, and the state Medicaid Fraud Control Units."
"The 'take-away' for corporate America should be that dedicated employees who try to do the right thing can't be silenced and made to go away," said Getnick. "The whistleblower laws -- which now cover tax, securities and commodities fraud, as well as health care and other frauds on federal and state government programs -- make sure that they have a voice and a remedy."
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