Drug Companies Face Federal Inquiries
By GARDINER HARRIS AND NATASHA SINGERAt least a dozen major drug and device makers are under investigation by federal prosecutors and securities regulators in a broadening inquiry of bribery allegations as to whether the companies may have made payments to foreign doctors and health officials.
In previous investigations, federal officials have charged that many of these kinds of payments were made to encourage doctors to order their products. In the United States, doctors routinely market drugs and devices to their colleagues and other health professionals at medical conventions and small gatherings in restaurants. Such consulting arrangements are legal in the United States as long as companies avoid paying doctors directly to write prescriptions.
But in most of the rest of the world, doctors are government employees. And even consulting arrangements that would be considered routine in the United States might violate the Foreign Corrupt Practices Act, if the payments are out-sized or the arrangements are not disclosed to governments.
Of even greater concern to prosecutors are unusually large payments made to foreign doctors who conduct the growing number of clinical trials that drug and device makers conduct abroad, according to Kirk Ogrosky, a former top federal prosecutor who now represents drug and device makers at a Washington law firm.
More than 80 percent of the drugs approved for sale in 2008 had trials in foreign countries, and 78 percent of all subjects who participated in clinical trials were enrolled in foreign sites, according to a recent investigation by Daniel R. Levinson, the inspector general of the Department of Health and Human Services. Medical ethicists have long worried that many of these trials are conducted in countries that federal auditors rarely visit and where ethical research controls are scant.
Now, prosecutors are investigating the payments made to doctors who run clinical trials for drug makers abroad. If evidence surfaces that such payments have influenced the results of these clinical trials, prosecutors will respond aggressively, Mr. Ogrosky said. An article about the inquiry was published Friday in the Financial Times.
Last month, a federal drug official reported that he found repeated instances within a landmark clinical trial of Avandia, a controversial diabetes medicine, in which patients taking Avandia appeared to suffer serious heart problems that were not counted in the study’s tally of adverse events. The study is a key reason that Avandia remains on the market in the United States.
“At the Justice Department, investigations that involve allegations of patient harm rise straight to the top and will attract the immediate attention of the FBI,” Mr. Ogrosky said.
Nearly a dozen companies have already settled with prosecutors in a string of cases that started in 2002 with a settlement by Syncor, which paid a relatively modest fine of $2.5 million to settle criminal and securities charges that the company used gifts, inflated invoices and improper referral payments to encourage doctors in state-owned hospitals to order Syncor products.
More cases followed, many of them involving European firms like Novo Nordisk, Akzo Nobel and Siemens, which operate in countries where until recently payments to foreign officials were not only legal but a deductible business expense.
In previous investigations, federal officials have charged that many of these kinds of payments were made to encourage doctors to order their products. In the United States, doctors routinely market drugs and devices to their colleagues and other health professionals at medical conventions and small gatherings in restaurants. Such consulting arrangements are legal in the United States as long as companies avoid paying doctors directly to write prescriptions.
But in most of the rest of the world, doctors are government employees. And even consulting arrangements that would be considered routine in the United States might violate the Foreign Corrupt Practices Act, if the payments are out-sized or the arrangements are not disclosed to governments.
Of even greater concern to prosecutors are unusually large payments made to foreign doctors who conduct the growing number of clinical trials that drug and device makers conduct abroad, according to Kirk Ogrosky, a former top federal prosecutor who now represents drug and device makers at a Washington law firm.
More than 80 percent of the drugs approved for sale in 2008 had trials in foreign countries, and 78 percent of all subjects who participated in clinical trials were enrolled in foreign sites, according to a recent investigation by Daniel R. Levinson, the inspector general of the Department of Health and Human Services. Medical ethicists have long worried that many of these trials are conducted in countries that federal auditors rarely visit and where ethical research controls are scant.
Now, prosecutors are investigating the payments made to doctors who run clinical trials for drug makers abroad. If evidence surfaces that such payments have influenced the results of these clinical trials, prosecutors will respond aggressively, Mr. Ogrosky said. An article about the inquiry was published Friday in the Financial Times.
Last month, a federal drug official reported that he found repeated instances within a landmark clinical trial of Avandia, a controversial diabetes medicine, in which patients taking Avandia appeared to suffer serious heart problems that were not counted in the study’s tally of adverse events. The study is a key reason that Avandia remains on the market in the United States.
“At the Justice Department, investigations that involve allegations of patient harm rise straight to the top and will attract the immediate attention of the FBI,” Mr. Ogrosky said.
Nearly a dozen companies have already settled with prosecutors in a string of cases that started in 2002 with a settlement by Syncor, which paid a relatively modest fine of $2.5 million to settle criminal and securities charges that the company used gifts, inflated invoices and improper referral payments to encourage doctors in state-owned hospitals to order Syncor products.
More cases followed, many of them involving European firms like Novo Nordisk, Akzo Nobel and Siemens, which operate in countries where until recently payments to foreign officials were not only legal but a deductible business expense.
No comments:
Post a Comment