The US' Multinational Trade Negotiations - Trading Away Its Own and Other Countries' Current and Future Restraints on Drug Prices?

Trade Agreements More about Deregulation than Trade

International trade negotiations, especially their more technical aspects, seem far removed from health care and health policy, and unrelated to health care dysfunction.  However, it seems that such trade negotiations have become a back door route to affect health policy, especially national efforts to regulate health care intended to improve patients' and the public's health.  

We recently discussed how current multinational trade negotiations seem to be more about changing regulation in favor of big corporations than broadly advancing trade.  Some of the effects of the proposed trade pacts could have bad effects on patients' and the public's health, particularly by allowing corporations to challenge particular countries' public health policies outside of these countries' judicial systems, in kangarooish courts seemingly designed to favor corporate interests.  Also, the trade pacts' focus on intellectual property could lead to longer patent protection on drugs, biologics, and devices, raising health care costs.  However, attempts to figure out how proposed trade agreements could affect health care and public health were hindered by the secrecy surrounding the negotiations.

"Procedural Fairness" for Pharmaceutical Companies, not You and Me

Earlier in June, 2015, a part of the current draft of the Trans-Pacific Partnership (TPP) appeared on  Wikileaks, revealing yet another set of concerns about how the agreement could affect health care.  It was entitled "Annex on Transparency and Procedural Fairness for Pharmaceutical Products and Medical Devices," and hence was specifically about health care.

The bulk of the annex seemed to be about improving the treatment of drug, device and biotechnology companies by national agencies that make decisions about payments for their products. The annex apparently proposed establishing the companies' rights to rapid reviews, access to applicable procedures and guidelines, access to written decisions, company appeals of the agencies' decisions, and protection of corporate confidential information. On the other hand, there was nothing I could see in the annex about the rights of, say, patients or health care professionals.

We have noted the concern that international trade agreements may make government regulation subject to corporate appeal in "investor-state dispute settlement" (ISDS) processes, essentially international quasi-courts that are not subject to national judicial systems, may not provide for any input by parties other than governments and corporations (that is, by, for example citizens, patients or health professionals), and may not allow appeal.  Thus, by specifically incorporating new protections for corporations seeking favorable payments for their new products from national agencies, the annex could make it possible for the corporations to appeal to ISDS, going around national court systems.  As reported in the Huffington Post,

According to an analysis of the leaked document by Jane Kelsey, a law professor at the University of Auckland in New Zealand, these rules are enough to expose national health authorities to legal challenges under TPP’s investor-state dispute settlement process, or ISDS. ISDS empowers companies to challenge countries’ domestic laws before a tribunal of international judges if they believe the laws unfairly limit investment. The tribunals have the power to impose significant fines on countries if their laws are found responsible for the investment hardship in question. While pharmaceutical companies could not challenge national health programs’ policies through ISDS, their grievances would be eligible for ISDS if the companies claimed the policies hindered investment.

In fact, the Huffington Post article noted suspicions that the US Trade Representative (USTR) has been negotiating on behalf of big US drug, device and biotechnology companies to target price regulations in Australia and New Zealand,

Among the United States’ TPP negotiating partners, pharmaceutical provisions have faced the greatest opposition from Australia and New Zealand, which have national health authorities that provide prescription drugs to their citizens at heavily discounted rates. The U.S. Trade Representative and U.S. pharmaceutical companies have targeted the cost containment measures in those countries’ prescription drug programs for years. Pharmaceutical companies also claim that New Zealand’s drug approval process is opaque and difficult to navigate.

Why Explicitly Include the US Center for Medicare and Medicaid Services (CMS)?

However, anyone in the US who thinks that all the burden from the trade pact is only on other countries, particularly those down under, should think again. The draft trade pact annex also seemed designed to prevent any future attempts by the US government to control drug and device costs, especially for the US Medicare program, even though the current US President has proposed such attempts. 

Note that when the US program was extended to cover drugs, the legislation specifically forbade the government from negotiating prices, a provision that seemed more about protecting corporate revenues than the federal budget.  So, as reported by the New York Times,

The newly leaked annex, dated Dec. 17, 2014, lists Medicare and the Centers for Medicare and Medicaid Services as falling under its strictures.

The USTR pooh poohed any concerns about that,

Officials at the United States trade representative’s office, while declining to comment on a leak they would not acknowledge, said rules in the Pacific accord would have no impact on the United States because Medicare already adhered to them. The trade representative’s office helped develop the proposals.

'Already, transparency and procedural fairness are integral parts of the U.S. legal system and as such are principles reflected in U.S. trade agreements,' the representative’s office said in a statement.

Maybe preventing any government negotiation about, much less control of drug and device prices may be part of what the USTR called "procedural fairness."  In any case, if the US, and specifically CMS are doing so well, why bother giving this trade pact jurisdiction over them, unless to prevent any uppity future US government from daring to negotiate with the pharmaceutical industry?

The Huffington Post noted that

In an earlier statement, [Director of Public Citizen's Global Access to Medicine Project Peter]  Maybarduk expressed concern that the rules would 'limit Congress’ ability to enact policy reforms that would reduce prescription drug costs for Americans –- and might even open to challenge aspects of our health care system today.'

He expanded on that in a commentary for The Hill,

Earlier this week, WikiLeaks published the draft TPP 'Annex' on healthcare technologies. In the five-page document, the U.S. government commits Medicare to rules and procedures that would make it difficult — if not impossible — to implement a national formulary that would provide leverage for proposed negotiations with drugmakers under Medicare Part D.

Medicare costs are expected to more than double from $77 billion in 2015 to about $174 billion in the next decade. In February, the president called for giving Medicare the power to negotiate prices with drug manufacturers to ameliorate this cost burden. Americans support giving Medicare negotiating power by wide margins and across party lines.

Negotiations are most effective if the U.S. government has leverage. Experts suggest that key leverage in Medicare negotiations should come from developing a national drug formulary — a list of drugs that Medicare would cover. A formulary would stimulate competition, reduce prices and lead to healthier outcomes for patients and the healthcare system.

But the leaked TPP 'Annex' shows that the pact would impose procedural requirements on formulary decisions, exact significant administrative costs and open up the drug review process to increased corporate influence. Medicare would have to live by these rules. The result could be a toothless negotiator, and a formulary filled with expensive drugs that have questionable public health benefits, if any.

Summary

So why did the US Trade Representative acquiesce to, if not actively promote, a trade pact that would limit the ability of the US government, specifically, CMS to try to put a damper on the ever rising health care prices that threaten to bankrupt individuals and maybe eventually the Medicare program itself? And why, incidentally did it do so when this appeared to contradict the current US President's own stated goal to have Medicare negotiate the prices it pays for drugs?  (And why, incidentally, did it promote a pact that would give international tribunals jurisdiction over US government actions when that may be unconstitutional according to an increasing number of experts?) 

The best speculation we offered before was that the USTR has been "captured" by industry, in part through the conflicts of interest generated by multiple passages through the revolving door by current and former USTR personnel. 

At the moment, the TPP has stalled again in the US Congress.  However, do not underestimate the ability of its proponents to get it moving again.  The now intermittent drip of secrets from the ongoing trade negotiations showing how little they have to do with trade, and how much they have to do with advancing corporate interests suggest the need for much more vigilance in defense of patients' and the public's health.

Meanwhile, I repeat again that we need to do a lot more to undo regulatory capture that affects health care, and stop the incessantly spinning revolving door.    Attempts to turn government toward private gain and away from being of the people, by the people, and for the people have no doubt been going on since the beginning of government (and since the Constitution was signed, in the case of the US).  However, true health care reform  would require curtailing the severe sorts of conflicts of interest created by the revolving door.

Real heath care reform would require  multiyear cooling off periods before someone who worked in the commercial world can get a job in a government whose work has direct effect on his or her previous employer or industry sector, and before someone who worked in government whose work had direct effect on a particular economic sector can accept a job for a company in that sector.

11:48 AM

Why is the New England Journal of Medicine Scolding "Pharmascolds"?

I, a normally quiet blogger on this site, was disquieted by what may be a backlash aimed at quashing the anti-conflict-of-interest movement.

Lisa Rosenbaum just published her second of three treatises in the highly prestigious New England Journal of Medine, scolding "pharmascolds" (see Conflicts of Interest: Understanding Bias — The Case for Careful Study). "Pharmascolds" is the term Rosenbaum and others use for those of us at Health Care Renewal, the Institute of Medicine, and countless medical journals and institutions.  Why?  Because we dare assert there is great danger when providers practice though saddled by (potential) conflicts of interests in medicine.  Such conflicts are created when physicians (up to 94% of us, according to Rosenbaum's research), other health care providers in practice, and health care organizations accept, not only gifts and trinkets, but also large, sometimes clandestine consulting fees and other arrangements from pharma and device companies, all the while providing direct patient care using the companies' products.

Rosenbaum and others say we pharmascolds are essentially self-righteous and obstructionist, holding back the progress of medical science.  In this article, she seems to claim that not proving direct patient harm from a specific questionable financial arrangement with a company whose product we may therefore more likely prescribe, speak well of, or publish (pseudo)evidence supporting the use of, is enough of a reason to justify the arrangement. 

Wouldn't that be the same as saying, "Until you actually crash into another car while texting, it's ok to text while driving, even if it's distracting."?

Rosenbaum uses mainly anecdote to prove her point, and appeals to a little-quoted, but still important, heuristic/bias called "moral liscensing."  Rosenbaum describes the phenomenon correctly: "once disclosure [of a conflict of interest] gets the weight [of guilt] off your chest, you feel liberated and may feel licensed to behave immorally."  True.  But then Rosenbaum seems to support non-disclosure of acts that create conflicts of interest, because disclosure doesn't decrease the acts themselves.

Rosenbaum goes further. At the same time as she supports non-disclosure of conflicts, she attempts to paint those who accept conflict-generating arrangements and keep them clandestine as victims--afraid to "come out of the closet" because doing so is socially taboo, though the activity is not wrong. 

I beg to differ.  For certain acts, potential conflicts, and actual conflicts, it seems to me that mere disclosure of the act or conflict shouldn't relieve one of the guilt associated with the act or conflict.  It also seems disclosure of a conflict should not make a speaker seem more credible to his/her audience because of its disclosure, though some research Rosenbaum quotes seems to show that disclosure improves credibility. 

Perhaps the stronger argument for disclosure is to disqualify people from activities that should be prohibited for people in conflict, as well as to warn people away from engaging in questionable activities that would result in conflicts. 

In an unbelievable twist of logic, Rosenbaum seems to be arguing in this article for more, not less of these questionable activities, in the interest of advancing science, until we prove patients are directly hurt by them, i.e., we have a "wreck."  Heck, let's get rid of traffic lights too, while we're at it.  People have eyes. We should trust them. They should be able to avoid accidents voluntarily, on their own.

In short, how could Dr. Rosenbaum not see that the best solution for the "problem" of conflicts of interests is avoidance when possible?  One can't help but wonder if she and the Journal aren't blinded by the shimmer and pull of powerful, influential organizations, ones so shiny, so strong, and so ubiquitous that resistance is just too hard for her, the Journal, and for 94% of us.

Conflicts of interest should be avoided.  Society has accepted that improved health will result not just from secondary prevention (e.g., not texting while driving after one has had an accident from the activity), but also from primary prevention (not texting while driving, even before an accident occurs). 

Wally R. Smith, MD

1:59 PM

BLOGSCAN - New England Journal of Medicine Scoffs at "Pharmascolds"

The venerable New England Journal of Medicine has now published an editorial,(1) and two commentaries(2-3), with one more promised, hailing physician industry "partnership," as per NEJM editor Jeffrey Drazen,(1) and deploring the "pharmascolds,"(3) who might question the glorious innovations that could arise when industry pays academic and practicing physicians.   

In a tweet, Dr Harlan Krumholz said he was "shocked" that a NEJM commentary would "give credence to the 'pharmascold' narrative.  

So far, the only more detailed questions about this new direction for the Journal came in a guest blog by Dr Susan Molchan in the HealthNewsReview blog, which responded only to the editorial(1) and the first commentary(2).  Dr Molchan wrote, 

Dr. Rosenbaum makes a nice try at reinterpreting financial conflicts between physicians and pharma, but however one twists and turns it, the dots still reconnect into dollar signs. She asks, “Have stories about industry greed so permeated our collective consciousness that we have forgotten that industry and physicians often share a mission — to fight disease?” Is Dr. Rosenbaum’s consciousness so clouded as to think that pharmaceutical companies don’t exist first and foremost to make money? That their primary responsibility is not to their shareholders?  It’s true that a means to this end is fighting disease, (including new “diseases,” tailored to one’s drug), but this should not be confused or conflated with the primary mission of (hopefully most) physicians.

I and many others suggest that the 'stories about industry greed' have not permeated enough, and that this problem has polluted much of medical research and medical practice, to the point where trust of the medical research enterprise has been eroded....

The airtime the NEJM is giving this issue, including publishing three - count them - strongly opinionated but hardly journalistic commentaries by their ostensible"national correspondent," suggest a major push against the "pharmascolds."  Again, note this this inflammatory and ad hominem term was used in a supposedly serious article on "Medicine and Society."  I strongly doubt we have heard the last of this.  Stay tuned. 

ADDENDUM (20 May, 2015) - See also comments by Mickey on the 1BoringOldMan blog.  

References
1.  Drazen JM.  Revisiting the commercial-academic interface.  N Eng J Med 2015; ; 372:1853-1854.  Link here.
2.  Rosenbaum L.  Reconnecting the dots - reinterpreting industry-physician relations.  N Eng J Med 2015;  372:1860-1864.  Link here. 
3.  Rosenbaum L. Understanding bias - the case for careful study.  N Engl J Med 2015;  372:1959-1963.  Link here. 

9:18 AM

Innovations form the Safra Center Ending iCorruption Conference

I had the pleasure of attending the Ending iCorruption Conference, the capstone conference for the Edmond J Safra Research Lab on Institutional Corruption, held at the Harvard Law School on May 1-2, 2015.  The conference included much material relevant to health care corruption and related topics, and provided some innovative approaches that could be used to address these issues.  I list these below, with citations or links when available.  At some point in the future, all conference proceedings should be available on video from the Safra Center.

Uncovering Data on Conflicts of Interest

Unearth: Using PubMed to Uncover Conflicts of Interest Affecting Clinical Research

Unearth is a browser extension now available for Google Chrome, and soon to become available for other browsers, e.g., Firefox.  It works on PubMed searches, scraping funding and conflict of interest data from the body of articles and adding them to abstracts.  We have often discussed such conflicts of interest, and their relationship to manipulation of clinical research.  Unearth could make such conflicts more salient, making it easier to discriminate unconflicted from conflicted research.  (See this post on the Bill of Health blog.)  This application was developed during the Safra Center Hacking iCorruption Event.

Open Think Tanks: Uncovering Think Tank Funding

Think tanks often publish findings on and make recommendations about health care.  However, think tanks are often opaque, and any institutional conflicts of interest they have may not be easily apparent.  Open Think Tanks currently shows donations from government entities outside the US to US based think tanks.  Enhancements to include various kinds of private donations are likely in the future. This application was also developed during the Hacking iCorruption Event.

Finding Unconflicted Academics

As we have discussed, the majority of medical academics have conflicts of interest, which may affect their research, teaching and patient care.  Yet these conflicts are not always disclosed.  Furthermore, finding experts without conflicts is not easy.  ProfessorCert is a website that allows academics who have no conflicts of interest to register as such.  The website was developed by the Academic Independence Project. 

Improving Integrity

Putting Consumers in the FDA and Other Regulatory Agencies

We have frequently discussed regulatory capture, how government health care regulatory agencies, like the US Food and Drug Administration (FDA),  often seem to end up more concerned about the financial health of those they are supposed to regulate than patients' and the public's health.   Harvard Prof Daniel Carpenter, collaborator in Safra Center research,  talked about the problem of  "cultural capture" of regulatory agencies, in which the regulators' thinking is influenced by outside vested interests.  He proposed that regulatory agencies need to put consumers, or presumably other stakeholders like unconflicted health care professionals, "into the room."  

Putting Ethicists in the C- Suite

We have frequently criticized the leadership of hospitals and hospital systems.  In particular, we have discussed instances in which these leaders seem to have gone directly against the mission of their own organizations, which we termed mission hostile management. Safra Lab Network Fellow James Corbett, now Senior Vice President for Centura Health, proposed that ethicists who also understand the language of finance and management be present among the top leadership of hospital systems.  

Licensing Executives

As noted above, a major theme of the Health Care Renewal blog is the shortcomings of the leadership of large health care organizations.  Top leaders often have business training, but may be ill-informed about health care, and ignorant or unsupportive of  or even hostile to its values.  Wellesley College Professor Emerita Ann Congleton's 2014 article in the Journal of Business Ethics, entitled Beyond business ethics: an agenda for the trustworthy teachers and practitioners of business, proposed requiring that corporate executives, including executives of health care corporations, be licensed in order to lead their organizations.  I proposed licensing of leaders of large health care organizations as early as 2008 (here).    

Pharmaceutical Research Uninfluenced by the Pharmaceutical Industry

Because clinical research meant to evaluate drugs or devices sponsored by  manufacturers of the relevant products has shown to be frequently manipulated, or even suppressed, many people have suggested banning such sponsorship and direct influence of such manufacturers.  (For example, see the book and blog, both entitled "Hooked," written by Dr Howard Brody, and see Health Care Renewal blog posts, e.g., here.)
Safra Center Network Fellow and Rowan University Professor Donald Light's book in press, Good Pharma, basically offers proof of the concept that high quality clinical research on pharmaceuticals can be accomplished without industry money or influence, albeit in Italy, at the Mario Negri Institute. 

Summary

The project on institutional corruption at the Safra Center produced a burst of innovation meant to address this pervasive project, and thus provided much of value to those who want to challenge health care corruption.  I hope this innovation will turn out to be truly disruptive.  It is regretful that this project has come to an end.  We can only hope others pick up the banner.  

12:23 PM

What Big Drug and Biotechnology Companies Will Not Tell Us - Transparency International on Corporate Reporting

Drug companies are entrusted to provide pure, unadulterated medicines.  Increasingly drug companies are now entrusted with doing research, including experimental studies, on human beings, and providing education to doctors and patients.  Ordinarily, trust requires confidence in transparency. However, a new report suggests that large multinational drug and biotechnology companies are not very transparent.

Transparency International just released a report on the transparency, or lack thereof, of the 124 biggest multinational corporations.  The report detailed how well these companies disclosed their internal anti-corruption programs, their subsidiaries, affiliates, and joint ventures, and their financial data broken down by the countries in which they operate.  In summary, the overall results for disclosing anti-corruption programs were mediocre, and for disclosing organizational structure and country-by-country financial data, they were dismal.

The report is highly relevant to health care.  It included the biggest multinational health care corporations, all drug and/or biotechnology companies: Abbott Laboratories, (based in the US), Amgen (US), AstraZeneca (UK), Gilead Sciences (US), GlaxoSmithKline (UK), Johnson and Johnson (US), Merck and Co (US), Novartis (Switzerland), Novo Nordisk (Denmark), Pfizer (US), Roche Holding (Switzerland), Sanofi (France), Teva Pharmaceutical Industries (Israel).

The report has so far received little media coverage.  In the US, several news services provided brief  summaries.  Somewhat more substantial articles came from Reuters, the Wall Street Journal's Risk and Compliance Journal, and CNBC.  None gave specifics about health care.  Coverage from other countries, e.g., Germany by Deutsche Welle, and the UK by the Guardian, was more detailed but also did not specifically mention health care.

Therefore, I will summarize the rationale and assessment methods used by Transparency International for its three dimensions of transparency, and then show results from the 13 health care corporations.

Disclosure of Anti-Corruption Programs

The rationale for addressing this area was:

Global companies have legal and ethical obligations to conduct their business honestly. This requires
commitment, resources and the ongoing management of a range of risks – legal, political and reputational – including those associated with corruption. The implementation of a comprehensive range of anticorruption policies and management systems is fundamental to efforts to prevent and remediate corruption within organisations.

Transparency International believes that public reporting by companies on their anti-corruption programmes allows for increased monitoring by stakeholders and the public at large, thereby making companies more accountable

Evaluation of disclosure of anti-corruption programs was

based on 13 questions, which are derived from the UN Global Compact and Transparency International Reporting Guidance on the 10th Principle against Corruption. This tool, based on the Business Principles for Countering Bribery, which were developed by Transparency International in collaboration with a multi-stakeholder group, includes recommendations for companies on how to publicly report on their anticorruption programmes.

Note that the project addressed only reporting of anti-corruption programs, not their implementation or effectiveness.

For this and the other two dimensions of transparency, responses were converted into a 0% to 100% scale, with 100% being the best possible result.

Organizational Transparency

The rationale was:

As many of the recent corporate scandals have shown, acts of corruption are very often aided by the use of opaque company structures and secrecy jurisdictions.  But the use of offshore companies and their lack of transparency are posing increasing risks for global companies as well as for their shareholders, employees and local communities.

So,

Companies can mitigate the risks posed by lack of transparency and ownership arrangements by shedding more light on their corporate structures and by making basic financial information public on a country-by-country basis. This allows stakeholders to have a clearer understanding of the extent of a company’s operations and makes the company more accountable for its activities in a given country, including assessing whether it contributes financially in a manner appropriate to its level of activity.

The measurement strategy was,

Transparency International researchers consulted publicly available documents such as annual reports and stock exchange filings for information about company subsidiaries, affiliates, joint ventures and other holdings. The information sought included corporate names, percentages of ownership by the parent company, countries of incorporation and the countries in which the companies operate.

Country-by-Country Reporting

The rationale included:

The importance of country-by-country reporting was first recognised in the extractive sector as a way to ensure that revenues from natural resources are used to foster economic and social development rather than line the pockets of kleptocratic elites.

So,

country-by-country reporting ... [is] a recognised building block for corporate transparency and as a tool for countering tax avoidance.

In addition, country-by-country reporting provides investors with more comprehensive financial information about companies and helps them address investment risk more effectively.

The items measured were disclosure of revenue/sales, capital expenditures, pre-tax income, income tax, and community contribution in each country in which the company operated.

Results for Health Care Corporations

Company                      Total  Anti-Corruption P  Org Structure  by-Country

Abbott Laboratories    40             81                           38                3
Amgen                          37             85                           25                0
AstraZeneca                37             88                           19                3
Gilead Sciences           26             54                           25                0
GlaxoSmithKline          52            96                           50               11
Johnson and Johnson  26           65                           13                0
Merck and Co               42           77                            50                0
Novartis                        38            77                           38                1
Novo Nordisk               39            81                           38                0
Pfizer                             35            92                           13                0
Roche Holding              33            62                           38                1
Sanofi                            38            77                           38                0
Teva Pharmaceutical  35            85                            19                0

Again, only one company, GlaxoSmithKline, achieved an overall score of barely better than 50%.  All the others had lower scores.  Only two companies achieved a 50% score on disclosure of organizational structure, and only one achieved a score of better than 10% for disclosing country-by-country results.  The Transparency International report noted that the health care companies got particularly bad scores for disclosing organizational structure, averaging 31%, the third worst performance by economic sector.


Summary

 The drug and biotechnology companies generally did a fairly good job disclosing what their anti-corruption programs were supposed to do.  However, note that the Transparency International report did not assess how well these programs were implemented or enforced.  That this concern is not academic is underscored by some of these companies disreputable track records.  Some have long histories of legal actions, including billion dollar plus legal settlements, some of which were of allegations of fraud or kickbacks, and some have been convicted of crimes.  See the records of, for example: Abbott Laboratories (look here and here), Amgen (here), AstraZeneca (here), GlaxoSmithKline (here), Johnson and Johnson (here), Merck (here), Novartis (here), Novo Nordisk (here), Pfizer (here), Roche (here), Sanofi (here), and Teva (here).

Moreover, the companies did not do a good job disclosing their organizational structures, and hardly any bothered to report any financial results broken down by country.

We have frequently discussed health care corporations' deceptive marketing, induction of conflicts of interest, including those of supposed "key opinion leaders" who often are marketers in academic or professional clothing, and manipulation and suppression of clinical research.  There has been an ongoing procession of legal settlements involving health care corporations, often involving allegations of, and sometimes convictions for fraud, kickbacks, bribery, or other crimes.  There have even been some cases in which drug companies have failed to assure that their products are pure and unadulterated, their most basic mission.  Thus many are distrustful of drug and biotechnology companies, and large health care organizations in general.

So, as Transparency International's report noted, to rebuild trust,

integrity must be central to these efforts. Those efforts, in turn, can only become fully credible if they are undertaken with a sustained commitment to ethical behaviour and transparency across companies’ operations.

In my humble opinion, a basic premise of true health care reform would be that health care organizations become sufficiently transparent to restore basic trust in them. 

11:44 AM

A Little Sunshine Peeking Through the Clouds? - the Sunshine Act is Finally Implemented, Sort of

"Conflicts of interest" is probably the most frequently used Health Care Renewal tag.  We believe conflicts of interest are a major causes of health care dysfunction.  Therefore, I felt that one of the truly reformative aspects of the US Accountable Care Act (ACA, "Obamacare") could be the "Sunshine Act," a provision championed by Iowa Senator Grassley (R) and his staff investigator, Paul Thacker, that would require public reporting of most financial interactions among health care corporations and health care professionals and hospitals.

The roll-out of Sunshine Act implementation occurred this week, and not unexpectedly, was very rocky.   As reported by the Wall Street Journal,

it hasn't been a smooth process. First, CMS delayed the public reporting of the data by a year to give companies more time to prepare. The Open Payments online system has experienced technical problems, including a data mix-up that resulted in some doctors being linked to payment records for other doctors with the same surname. The preview function for doctors had a cumbersome registration process, some doctors said, and was taken offline at times in recent weeks.

The first batch of data is incomplete. CMS in August said it removed about one-third of the payment records from the physician-preview database because it said some of the state medical-license numbers that companies reported for doctors didn't match a database that the agency was using for verification, among other problems. CMS now is releasing those records but without identifying the physicians tied to them. It will update the database to include the physicians' names for those records next year. Also, CMS isn't immediately releasing payments related to proprietary research-and-development; those will be reported at a later date.

 But why should we have expected anything else, given the parties involved?

Drug, Device and Biotechnology Companies

As reported by the NY Times,

all manufacturers of drugs, medical devices and medical supplies that have at least one product covered by Medicare or Medicaid must report payments or gifts they make to doctors and teaching hospitals. This can be as seemingly trivial as a bag of bagels — all payments above $10 are included — or as lofty as a research grant. It also includes meals, travel expenses and speakers’ fees. Group-purchasing organizations, which serve as middlemen between health care providers and manufacturers, also must disclose doctors’ ownership and investment interests in their companies.

Presumably such reporting actually was quite burdensome to the companies.

Furthermore,company executives might not be exactly thrilled about putting all this information out there.  As we have frequently discussed, to serve their own interests, such companies make all sorts of payments to physicians, other health care professional, and hospitals and other non-profit health care organizations.  In particular, payments to health care professionals may foster companies' marketing and public relations goals.

While some payments are made for technical and clinical consulting, many are to support "education" that may serve marketing or public relations.  In particular, many payments are for "drug talks," that is, talks sponsored by the drug companies, usually through speakers' bureaus, and given probably not as part of formal, accredited continuing medical education.  Since the publication of "Dr Drug Rep" in the New York Times in 2007, it became evident that such talks emphasize content provided by the pharmaceutical companies, and are intended to be corporate marketing exercises.  From that case we also learned that physicians who deviate from the marketing message do not last long on speakers' bureaus.  (See posts here and here.)

In addition, pharmaceutical companies often pay physicians deemed to be "key opinion leaders," whose opinions are promoted supposedly for their brilliance and erudition.  However, as noted here and here, the companies buying their services think of KOLs as sales people.    Evidence about key opinion leaders actually performing like marketers has come from documents revealed during litigation (e.g., see this recent example of a huge monetary settlement made of charges that GlaxoSmithKline, a major multinational drug company committed fraud among other things, and in the course of its unethical activities used key opinion leaders as marketers).   Also, see the Neurontin marketing plan (see post here), and the Lexapro marketing plan (see post here) for examples of how corporate managers view key opinion leaders as marketers.

Pharmaceutical, biotechnology, and device companies protest that much of the money they pay goes to support research.  But the clinical research they sponsor has been shown to be frequently subject to manipulation designed to increase the likelihood of results favorable to these companies' products.  When manipulation fails to provide sufficiently favorable results, corporations may simply  suppress it.  Academic institutions desperate for more external funding, and physicians whose continued gainful employment at such institutions requires external funding may not be too quick to protest manipulation and suppression by those paying the bills.

Vox just summarized some of the relevant evidence:

Research for decades has shown that relations with industry — from industry-sponsored education to encounters with pharmaceutical-company sales representatives, and even drug samples provided by those companies — can bias a doctor's judgment in all sorts of ways. It can color the medical education they give to future doctors, cause them to inappropriately prescribe drugs, to push for the FDA approval of medicine, or for drugs to be included on their hospital formularies. Industry-funded studies are also four times more likely to lead to favorable and positive results than independent research.

The side-effects of this 'Bad Pharma' behavior range from waste in the health system, to mistreatment of patients, and even avoidable patient death.

So is it any surprise that industry may not have been enthused or comfortable about complying with the Sunshine Act?  Instead of admitting that, of course, they have complained, as reported by the NY Times,

the website is being questioned by the industry, which says that technical problems and data inaccuracies limit its value.

But it seems that industry may have created the sorts of data problems about which they now complain.  Note that when ProPublica made this first assessment of the database,

Many drug and device companies attributed payments to multiple subsidiaries, rather than reporting them under the name of a single parent company. Johnson & Johnson, for instance, submitted payments under at least 15 subsidiaries. The device maker Medtronic reported payments by at least six subsidiaries. So did the drug maker Novartis. On first blush, that makes it tough to calculate how much each company spent overall.

Similarly, companies reported payments associated with particular drugs in different ways. The expensive drug Acthar, which is marketed for a variety of different conditions, is listed under at least eight different name variations. The diabetes drug Januvia is reported as both 'Januvia' and 'Januvia Diabetes.' There is one drug simply listed as 'KNEES' and another as 'Foot and Ankle.'

So it appears that the companies reported data in a confusing, perhaps deliberately confusing manner, obfuscating the relationships between companies and subsidiaries, and between essentially similar drugs with different names.  It is hard to believe that all, or even most of these problems were due to mishandling by the government.  So it is a little hard to take the companies' criticisms of the quality of the data seriously.

Physicians and Organized Medicine

"We have met the enemy and he is us." - Pogo

On the other hand, news articles suggested some physicians were also unhappy with the data release.  For example, per the WSJ article,

Some doctors disputed details of the payment data. The database shows John LeDonne, a surgeon from Baltimore, as having received about $78,200 in payments for food and beverage for the five-month period from medical-device maker Dr. LeDonne acknowledged he performs paid consulting work for health-care companies including Teleflex, but that he rarely received free meals. He said the total payment amount was in the right 'ballpark,' but should not have been classified in the food-and-beverage category. 

That seems to be a bit of quibble.  The amount he received, and its source, seem more important than whether it was labelled "consulting," or "food and beverage" payments.

More importantly, a few doctors were worried, as reported by the Minneapolis Star-Tribune, that the information may reflect negatively on them,

 'Overwhelmingly, the interaction between industry and physicians is positive,' said Dr. Robert Harbaugh, chairman of neurosurgery at Penn State and president of the American Association of Neurological Surgeons.

Maybe Dr Harbaugh should realize that there already are a lot of reasons to think about the negative aspects of physician - industry paid interactions, as summarized above. And Vox reported,

 Dr. Thomas Stossel, known as Harvard's 'pro-industry professor,' says 'doctors' work with industry is necessary and beneficial.' He worries that the Sunshine Act could make it embarrassing and difficult for doctors to do work like developing medical devices or designing clinical trials, and that industry may start avoiding working with American doctors because of the time and investment disclosure will require.  

Dr Stossel did not provide evidence to explain the necessity or benefits of the work for industry, nor why doctors could not design clinical trials outside of industry relationships. 
Doctors also complained about data quality, but I am not aware that the medical profession rushed to help with improving the data for the Sunshine Act.  Obviously, there are some physicians who have personally profited quite a lot from their relationships with drug, device, and biotechnology companies but who may not be comfortable having the figures booted around in public, e.g., per the WSJ,

Among individual physicians, Stephen Burkhart was one of the top recipients of non-research payments from industry. The San Antonio orthopedic surgeon received $7.4 million in non-research payments or transfers of value for the five-month period, mostly from device manufacturer Arthrex Inc. for payments identified as 'royalty or license.'

Dr. Burkhart couldn't be reached for comment. Arthrex said in a statement that it has 'financial relationships with a number of orthopedic surgeons and teaching hospitals,' like many manufacturers, for their advice and expertise.

Chitranjan Ranawat,a New York orthopedic surgeon, received about $4 million in nonresearch payments or transfers of value, mostly from DePuy Synthes unit for 'royalty or license,' according to the database. 

 Dr. Ranawat couldn't be reached for comment.

And those were payments made in a five month period.  Maybe the doctors have a reason to be uncomfortable.

Furthermore, ProPublica reported that 21% of the $3.5 billion in payments, approximately $735 million, reported by the system were for "promotional talks," a la "drug talks" as noted above.  Since "Dr Drug Rep," such talks have gotten something of a bad reputation, but are obviously lucrative, so those who got paid to give them may not be happy with their detailed disclosure.

The US Department of Health and Human Services

The Sunshine Act was but a small part of the huge ACA, most of which the US DHHS, and particularly the Center for Medicare and Medicaid Services (CMS) was charged with implementing, but probably with proportionately insufficient funding and time.  So no wonder that the Sunshine Act never seemed to find a vocal champion within DHHS.

Most likely money concerns, and the constant din of outside criticism of "government bureaucrats" by those demanding more "business-like" government lead CMS to outsource the work on the Sunshine Act database, as described by another ProPublica article,

While the payments database is a far cry from Healthcare.gov — and less complex – it's reasonable to expect some glitches. CGI Federal, the company that led what turned out to be the botched launch of Healthcare.gov, is also responsible for the release of the payment data.

Massachusetts also outsourced operation of its Health Connector to CGI Federal, with equally bad results.  The state had to terminate the contract (look here.)

So if lackadaisical bureaucrats outsourced the Sunshine Act to contractors of questionable competence, what result should have been expected?

Why the present administration, and the bureaucrats it supposedly commands, seemed so uninterested in this particular aspect of the ACA is not clear, but perhaps we should peer around some revolving doors for the answer.  (For example,  John Podesta, a current White House adviser, worked for non-profits funded by drug company Eli Lilly and device company Synthes [look here]; and Nancy-Ann DeParle, former White House "health czar," had previously served on the boards of of Boston Scientific, Cerner and Medco [look here], and now is involved in health care investments made by private equity, and is on the board of CVS [look here]).

Of course, the sort of conflicts of interest that were supposed to be revealed by the Sunshine Act are highly beneficial to the parties directly involved, whatever embarrassment they may cause.  Given the power of those parties, plus the lukewarm, outsourced effort by government perhaps influenced by government officials with their own "revolving door" conflicts of interest, is it any wonder that the Sunshine Act implementation was "rocky?"

Summary

Nonetheless, because of the Sunshine Act, we do now know a bit more about conflicts of interest involving drug, device, biotechnology and related companies on one hand, and physicians, other health care professionals and hospitals on the other.

Maybe throwing even veiled sunshine on some of these relationships will inspire some people to rethink whether they want to continue them.  There are other reasons they should do so.

We have called endlessly for full, detailed disclosures of all conflicts of interest, for honesty's sake if for no other reason.  We have also called for severe curtailment of all conflicts affecting clinical decision making, health care education, clinical and health care research, and health policy making.  But Health Care Renewal can easily be dismissed as a voice crying out in the wilderness.  However, we are really not alone.

The 2009 Institute of Medicine report set relatively tough standards for managing conflicts of interest affecting clinical research and teaching, which unfortunately since have largely been ignored.  It did call for senior institutional officials to disclose their conflicts of interest, and for institutional boards of trustees to form conflicts of interest committees that would exclude conflicted individuals, but otherwise did not address conflicts of interest affecting academic leaders or institutional trustees.  The 2013 Pew Charitable Trusts Conflicts-of-Interest Policies for Academic Medical Centers suggested restrictions on conflicts affecting faculty, trainees, and students, but again did not mention senior institutional leaders or boards of trustees.  Implementing even some of these recommendations would be true health care reform.

Maybe more publicity about the web of conflicts of interest that drapes of over health care will lead to some further steps in the needed direction. 

9:02 AM

No Treatment or Vaccine for Ebola, but a $1000 Pill for Hepatitis C

The Ebola virus epidemic in West Africa continues to grow, and now appears to be the worst known epidemic of that disease to date.  In the US and Western Europe, press reports are now raising concerns that the disease could spread there.  For example, CNN, in an article entitled "Ebola Fears Hits Close to Home," was a section headed "Could Ebola spread to the US?" An ABC article was entitled, "How the US Government Could Evacuate Americans with Ebola."

Reasons for fear of spread are the increased mobility of people made possible by air travel, and the lack of specificity of early symptoms of Ebola, so infectious people may not realize the dangers their travel might pose.  A US citizen with Ebola was on his way back to the US via several connections, and made it as far as Lagos, Nigeria before becoming too ill to travel further (per CNN).  Making the fears worse are the high fatality rate of Ebola, the current epidemic included.  According to Vox, the current outbreak is the Zaire subtype of the virus, with an expected mortality rate of 68%.  Finally, there is no known effective treatment or vaccine for the Ebola virus.

Economics, not Science the Reason for Lack of Medical Options for Ebola

The reason there are no vaccines or treatments available for Ebola does not appear to be the scientific difficulty involved in developing them.  Vox also published a discussion for the economic genesis of the problem:

 Researchers have devoted lots of time to building a vaccine that could stop the disease altogether — and according to Daniel Bausch, a Tulane professor who researches Ebola and other infectious diseases, they're making really significant progress.

Bausch says that the obstacle to developing an Ebola vaccine isn't the science; researchers have actually made really great strides in figuring out how to fight back against Ebola and the Marburg virus, a similar disease.

'We now have a couple of different vaccine platforms that have shown to be protective with non-human primates,' says Bausch, who has received awards for his work containing disease outbreaks in Uganda. He is currently stationed in Lima, Peru, as the director of the emerging infections department of Naval Medical Research Unit 6.

The problem, instead, is the economics of drug development. Pharmaceutical companies have little incentive to pour research and development dollars into curing a disease that surfaces sporadically in low-income, African countries. They aren't likely to see a large pay-off at the end — and could stand to lose money.

Prof Bausch elaborated,

These outbreaks affect the poorest communities on the planet. Although they do create incredible upheaval, they are relatively rare events. So if you look at the interest of pharmaceutical companies, there is not huge enthusiasm to take an Ebola drug through phase one, two, and three of a trial and make an Ebola vaccine that maybe a few tens of thousands or hundreds of thousands of people will use.

Of course, that assumes that this outbreak, like previous ones, will remain relatively confined, at least to Africa.

The 10/90 Gap

So the implication is that had things been otherwise, those in developed countries now worried that Ebola could spread their way could have been reassured by the availability of a vaccine, or other treatment.

The irony, if that is the right word, is that we do not have an effective treatment or vaccine for a viral disease that is relatively easily spread, and could likely rapidly kill nearly 70% of those infected.  Yet in the last months, we have been arguing about how the use of an extremely expensive treatment for another viral disease that is difficult to spread, and may kill a few percent of its victims over up to 20 or 30 years after infection.

I am referring, of course, to Sovaldi, the recently announced $1000 pill for hepatitis C.  Hepatitis C does affect a lot of people, including relatively affluent people in developed countries.  As we noted previously, though, the majority of people infected with hepatitis C will never have serious medical repercussion from it.  Small proportions of patients will eventually develop severe liver disease, including cirrhosis, liver failure, and liver cancer, and may die from the disease.  (See the report by the Center for Evidence Based Policy). Yet the treatment is being promoted for all patients with hepatitis C, most of whom could not benefit from treatment.  Furthermore, the evidence that treatment will actually prevent bad clinical outcomes, cirrhosis, liver failure, liver cancer, and premature death, is weak (look here).   Yet considerable money was devoted to developing multiple hepatitis C treatments, with the expectation that huge amounts of money could be made from selling them.

This is an example of the 10/90 gap

A long time ago, in 1998, I was invited to Forum 2 of an organization called the Global Forum for Health Research  The GFHR was an organization dedicated to overcoming the "10/90 gap":

Less than 10% of the worldwide expenditure on health research and development is devoted to the major health problems of 90% of the population

Yet the 10/90 gap is probably getting worse.  In the US, our health care has now been heavily influenced by advocates of neoliberalism, or economism.  Health care is now largely run by generic managers trained in business schools, with no specific training or expertise in health care, and doubtful loyalty to its values.  Current business school dogma emphasizes the primacy of economic efficiency over all other goals (look here), to maximize "shareholder value," which usually practically means maximizing short term revenue, to the immediate advantage of shareholders sometimes, but nearly always to the great and immediate financial advantage of paid managers and executives.  The emphasis on short term revenue uber alles helps explain how we have multiple expensive hepatitis C drugs, and no Ebola drugs or vaccines.

The real irony is now that some very well paid managers may be worrying about the possibility of contracting Ebola whose transmission was facilitated by our increasingly global economy, globalized in part due to the advocacy of those advocating neoliberalism and economism.

Summary

Unfortunately, the fortunes of the Global Forum for Health Research seem to have faded.  It went into sudden decline in 2010, and was subsumed into COHRED, the Council on Health Research for Development.  The last Global Forum meeting was in 2012, although there seem to be plans for another next year.    Meanwhile, multiple international organizations. including Medicins Sans Frontieres, established a Drugs for Neglected Diseases initiative, although its progress seems to be slow (see Pedrique B, Strub-Wourgaft N, Some C et al.  The drug and vaccine landscape for neglected diseases (2000-11): a systematic assessment.  Lancet Glob Health 2013; 1: e371.  Link here.).

In my humble opinion, as long as much of the health care system is run so as to put short-term revenue ahead of all else, a manifestation of financialization encouraged by the generic managers who run so much of health, partly in their own self-interest, and by business schools promoting the shareholder value theory, we will not make much progress on the 10/90 gap.  Ironically, the realization that even rich generic managers may no longer be protected from some of the deadliest diseases that used to only afflict the poorest people in the world may have an effect on this problem.   

As I have said before,  true health care reform would put in place leadership that understands the health care context, upholds health care professionals' values, and puts patients' and the public's health ahead of extraneous, particularly short-term financial concerns. We need health care governance that holds health care leaders accountable, and ensures their transparency, integrity and honesty.

But this sort of reform would challenge the interests of managers who are getting very rich off the current system.  So I am afraid the US may end up going far down this final common pathway before enough people manifest enough strength to make real changes.

ADDENDUM - This was re-posted on the Naked Capitalism blog. 

1:19 PM

BLOGSCAN: Key Opinion Leader Admits to being a Marketer

Without any notable shame, and as a guest blogger on KevinMd.  The post was about other physicians can become big-time KOLs by using social media, and refers to another post which indicates that pharmaceutical companies look for physicians who are big prescribers of their products and have a lot of influence to, guess what, help market their products.  Although the blogger refers to ethics more than once, how it is ethical to trade on the trust physicians get for their professional vows to put patients first to market products (that may not always be good for patients) remains beyond me.

ADDENDUM (27 August, 2012) - See also comments by Dr Howard Brody on the Hooked: Ethics, Medicine and Pharma blog.  

11:56 AM

More "You're Too Negative, And You Don't Provide The Solution To The Problems You Critique", This Time re: Pharma

I think it worth noting that critical writers about both health IT and pharma attract a similar phenomenon: the anonymous attack accusing them of 'negativity' and not providing 'solutions.'

One excellent blog I read, as a former director of a pharmaceutical R&D department that supported, among others, medicinal chemists, is Derek Lowe's "In the Pipeline."

In the comment thread at his 'In the Pipeline' understatement-of-the-year post "Taking the Ax to the Scientists Is Probably a Mistake" (link), I posted numerous links to various Healthcare Renewal posts on pharma's current travails related to that theme, and to other forms of pharma mismanagement. The comment thread is below the post itself at the aforementioned link.

I post as "MIMD" and frequently link here and to my Drexel academic site, so I am anything but anonymous.

Invariably, a response (anonymous, of course!) of the type we've seen here at Healthcare Renewal (such as here and in a more extreme example, here) has appeared. Various logical fallacies are used as a form of argument.

Emphases and red comments mine:

74. Reply to MIMD [how's that for anonymity - a screen name of "Reply to MIMD"? - ed.] on April 4, 2012 3:44 AM writes...

MIMD, you have commented at length on this post blaming various parties for the industry's woes [i.e., you're too negative - ed.], dismissing other points of view [that are almost always unsubstantiated; I provide hyperlinks to posts at this blog and others regarding pharma mismanagement and malfeasance to justify my views - ed.] out of hand [well, no, actually - ed.] and offering nothing in the way of new ideas or solutions.

[Except for the myriad aforementioned links and clearer identification of the problems - ed.]

And then, this:

"If I were still in pharma and had kids in college and a mortgage, and a hope for a pension, I'd literally be keeping my head low. And certainly not writing the types of posts I do here and on the blog I often link to!"

[Pharma is as retaliatory of its internal critics and "whistleblowers" as is clinical medicine, except doesn't even bother with sham "peer review"; they just send people out the door. I do not believe pharma management understands or cares about the implications to people who are not wealthy. Discreetness and timing are everything for putative internal medchem change agents in this environment - ed.]

I'd just like to get your thoughts on the delicious irony of this post in the middle of your long-winded and boring commentary.

[Approaching ad hominem - ed.]

As far as I understand, you're advocating that pharma scientists blame anything that breathes for the problems whilst [seems to be from UK or related country - ed.] actively avoiding attempting to find a solution.

[Classic strawman argument - ed.]

Weirdo [another anonymous poster, possibly the same person as this - ed.] commented on this, and you laughably dismissed it out of hand so I expect no more.

[I opined that a naïvely idealistic and/or cruel Marie Antoinette-like suggestion that laid-off medicinal chemists simply just set up their own drug discovery shops to show Big Pharma how it 'should be done', as if doing so were a realistic option financially for mostly middle class people strapped by being laid off mid-career, was a useless suggestion - ed.]

But if you do fancy dropping a few more 'pearls of wisdom' our way I'd be fascinated to read them!

I think it was Homer Simpson that said "It's everybody's fault but mine". Seems apt, no? [No, in fact - ed.]

Permalink to Comment

My reply was:

75. MIMD on April 4, 2012 9:49 AM writes...

Re: #74

Regarding your comments, I offer a hearty "so what?"

In your comment I see no meaningful critiques of any of the volumes of writing I've posted links to, other than the hackneyed, quasi-ad hominem, without-merit statement about "dismissing other points of view out of hand and offering nothing in the way of new ideas or solutions."

That's disappointing.

I also must point out this classic example of the strawman fallacy:

you're advocating that pharma scientists blame anything that breathes for the problems whilst actively avoiding attempting to find a solution

I do believe they teach better debating skills in the Commonwealth realms.

Finally, when you come out from behind your cloak of anonymity, I'll consider answering in more depth. Who are you? What agenda are you hiding?

My bio is on the site I often link to, as well as at here.

Permalink to Comment

Derek Lowe's blog is a serious site for medicinal chemists and like-minded scientists currently being discarded by pharma; a perfect place for anonymous pharma sockpuppets to intersperse their materials.

Although I doubt it, it will be interesting to see if the anonymous poster reveals exactly who they are and what their agenda is.

I add that in an industry plagued with scientific ghostwriting, suppression of negative research, misleading marketing, an endless parade of "legal settlements" for various forms of malfeasance, mass layoffs and other troublesome practices, I find "ghost commenters" who attack the industry's detractors from behind cloaks of anonymity quite suspect. (Unless, of course, and ironically, the writer is afraid of pharma retaliation.)

Finally, I can understand how pharma executives might find detailed stories about pharma mismanagement and leadership thought errors profoundly disturbing. They are usually protected from such candid material in their dystopic, highly remunerative cocoons surrounded by ear-pleasing consultants and employee sycophants rightly fearing career termination.

-- SS

8:00 AM

Pharmacy Benefit Managers as Pharmaceutical Marketers

We posted a number of times about questionable practices Eli Lilly used to market its atypical anti-psychotic drug Zyprexa (olanzapine). A post from 2007, with links backward, is here, and our most recent post is here. The company remains entangled in litigation over its marketing of this drug. That litigation has lead to the release of numerous internal documents that provide quite a view of Lilly's marketing practices. Bloomberg continued its reporting on these documents, with its latest effort here via the Boston Globe, describing yet another surprising way this drug was sold:

A unit of CVS Caremark Corp. used its access to doctors to market Eli Lilly & Co.'s Zyprexa antipsychotic while it was under contract to bargain with the drug maker on behalf of health insurers, internal Lilly files disclosed in a multibillion-dollar lawsuit by insurers show.

The subsidiary of CVS, the largest US drugstore chain, touted Zyprexa starting in 2003, according to e-mails made public by lawyers suing Lilly for overpayment. CVS's AdvancePCS, a pharmacy benefit manager, or PBM, offered to send 120,000 letters to doctors promoting the drug, Lilly's top-seller with $4.7 billion in sales last year, according to a confidential 2004 proposal. The CVS unit said it would charge $5 per letter.

AdvancePCS, acquired by Woonsocket, R.I.-based CVS in 2007, said in the documents that the direct-mail campaign was 'designed to influence key prescribers' as part of a 'tactical plan for Zyprexa.'

Furthermore,

In AdvancePCS's 2004 pitch to Lilly offering to send out letters promoting Zyprexa, Kevin Aholt, the company's assistant vice president in charge of strategic alliances, said he could target physicians based 'on the most recent AdvancePCS claims data,' according to the unsealed documents.

Aholt also said that one of the 'key issues' in the market for antipsychotic drugs was finding ways to 'accelerate the growth of new patient starts,' according to the proposal.

Also,

Steven Fuchs, an official at the PBM, asked Lilly officials in an April 2004 e-mail whether he should include information about Zyprexa's ability to calm agitated patients in the next round of letters to doctors.

'Would a discussion of that be something you would want to include?' Fuchs asked, according to the document.

Lilly marketing executive Scott Dell responded in an e-mail that officials at the drug maker had discussed asking AdvancePCS to include material highlighting 'the new bipolar maintenance indication for Zyprexa.'

AdvancePCS was not the only pharmacy benefits manager (PBM) that offered to help sell Zyprexa.

CVS rival Express Scripts Inc. also sent out Zyprexa marketing letters, according to the unsealed documents and also isn't named as a defendant in the suits.

So here we have at least two pharmacy benefit managers (PBMs) offering to help market a particular drug, for money, of course. What is the problem here?

CVS's contracts with insurers and pensions meanwhile place it in an adversarial posture with Lilly, requiring it to use its buying power as leverage in drug-price negotiations.

'The problem is that PBMs are negotiating these hidden deals while at the same time telling employers that they represent them at the negotiating table,' said Gerry Purcell, a former PBM executive who advises companies on their drug plans. 'These documents will add fuel to the perception that the companies and the PBMs are in cahoots with each other.'

Also,

While PBMs negotiate on behalf of insurers, most states don't designate them as agents of the benefit plans, said Robert Garis, a pharmacy professor at Creighton University in Omaha who studies the industry. As a result, they aren't legally required to act only in the best interest of their clients, he said. Maine is one of a few states that have specified PBMs as fiduciaries, or agents, he noted.

'The companies have gotten around that by adding language to their contracts that exclude them from having to meet those fiduciary duties,' Garis said.

Apparently, in this case, one PBM said it disclosed its relationship to the drug company to physicians, but it is not clear whether it was disclosed to the health care insurers and managed care organizations which paid the PBM to reduce the costs of drugs:

CVS, which isn't a defendant in the Lilly suit, said that it tells doctors when it has 'financial relationships' with drug makers and that they are free to opt out of mailings.

'To engage in a point/counterpoint in a media outlet rather than in court would not be productive,' said Lilly spokeswoman Marni Lemons.

Lemons declined to answer specific queries about the CVS or Express Scripts letters, whether Lilly paid for the practice, or other questions raised by the unsealed documents....

CVS said in its e-mailed statement that it has 'no active educational programs' related to Zyprexa.

'CVS Caremark discloses to its PBM clients that it may have financial relationships with pharmaceutical manufacturers in connection with these educational programs,' said Christine Cramer, a spokeswoman for the chain. 'CVS Caremark's PBM clients are aware of these programs and have the opportunity to opt out.'

Maria Palumbo, a spokeswoman for Express Scripts, didn't respond to eight telephone and e-mail requests seeking comment.

CVS covers 82 million people, with a market share of 12 percent, and is the largest pharmacy benefit manager, according to Atlantic Information Services. Express Scripts, which covers 55 million people, is the fifth largest. PBMs process about 75 percent of the retail prescriptions written annually in the United States, according to the insurance plans.

The insurance plans sued the drug maker in 2005, contending it used researchers, pharmacy benefit managers, advocacy groups, and public agencies to promote Zyprexa.

Whether or not the PBMs disclosed their relationships to the pharmaceutical company to everyone who might be interested, it does seem that having PBMs who are supposed to help insurers and managed care organizations control drug costs be paid by pharmaceutical companies to market drugs is yet another new species of institutional conflict of interest. Like the many other conflicts of interest, individual and institutional, we have discussed, this one appears to be mutually advantageous to the parties involved. However, it could have adverse consequences for physicians, patients, and the health care system. If the organizations that are supposed to be controlling drug costs are also promoting expensive drugs, the likely result would be excess prescription of expensive drugs to patients who may not derive benefits from the drugs outweighing their harms.

This is another reminder how much we need more sunshine shone on the multitudinous conflicts of interest affecting just about every type of actor within the current US health care system.

6:00 PM