This is not the first time the FDA has offered some tough talk. The latest warning, however, comes from FDA deputy chief for litigation Eric Blumberg, who spoke at an industry conference yesterday and reiterated agency interest in targeting pharma execs for misdemeanor prosecutions if their companies engage in off-label marketing.
His remarks come amid growing complaints that the large fines paid and corporate integrity agreements signed by drugmakers to settle such charges are, essentially, viewed as a cost of doing business and that few, if any, individuals with sweeping corporate authority are held accountable. Among the drugmakers that have settled are Pfizer, Eli Lilly, Johnson & Johnson, AstraZeneca, Bristol-Myers Squibb, Allergan, Forest Laboratories and Novartis.
“It’s clear we’re not getting the job done with large, monetary settlements,” Blumberg told the conference, according to Bloomberg News. “Unless the government shows more resolve to criminally charge individuals at all levels in the company, we cannot expect to make progress in deterring off-label promotion...If you’re a corporate executive or are advising a corporate executive, now is the time to comply. That conduct may already be under the criminal microscope.”
What's at stake? An exec could face up to $100,000 in fines and one year in jail (shareholders may object the employer pays for legal representation, but that is a separate matter). The FDA also can bar individuals from working in the industry. Last March, the FDA indicated it would pursue misdemeanor charges (back story), most likely by using a legal tool known as the Park Doctrine, which the agency last used more than a decade ago to press felony charges.
The emphasis on prosecution also comes as the Health and Human Services Office of Inspector General pushes for measures that would make it possible to ban pharma execs from doing business with federal health programs, such as Medicare and Medicaid, if their companies have been convicted of fraud. The House, in fact, recently passed a bill toward that end (see here).
29 Comments
When you look at the latest report about health insurer pre-existing condition policyholder application rejection practices, it makes you wonder why some of these executives and/or board members don't seem to have any trouble accessing directors and officers insurance.
While the threat of putting executives behind bars likely has the potential to change the corporate culture of certain companies, it's ironic to think that the incarcerated execs would still be living on the taxpayer's dime and could potentially be represented by co-counsel consisting of white collar criminal defense attorneys and the ACLU.
If there are any JD's out there, I'd be interested in hearing their take on the criminal prosecution of corp execs for off-label promotion in the wake of the Citizens United decision. If 1st Amendment rights for corporations are as expansive as they seem to be based on that decision, it would seem that prosecuting the industry for off-label claims--or any claims at all, aside from outright lies--might be protected.
My question is from the medical communications perspective. If an individual advertisement or detail is deemed "fraudulent" would that make the med comms agency a co-conspiritor? Seems to me there would be a lot of people involved and subject to litigation.
Then again, I have been told for years that Brand X will get my whites whiter than Brand Y. If I do not think this is so, can I sue?
Just for clarification, I believe that the Park Doctrine was actually used just a few years ago (2007) in connection with misdemeanor pleas and debartment of Purdue's CEO, General Counsel and Chief Medical Officer, as well as indictments against executives of Synthes and Stryker (2009). I have, however, been surprised that this has not been pursued more often.
Ok Mr. Blumberg, we will see!
Talking the Talk is one thing, Walking the Walk is something entirely different.
Based on past FDA 'TOUGH TALK', I am not going to hold my breath on this one.
However, I have a feeling he will have the chance soon to put his money where his mouth is soon enough.
Inn response to Salient point, there is a difference between political speech and commercial speech by corporations. As I read Citizens United, it rests entirely on the fact that the issue concerned political speech, which is at the core of the first amendment.
In contrast, under the Supreme Court's earlier decision in Central Hudson, the government can prohibit commercial speech that concerns unlawful activity or is misleading. Even if the speech concerns lawful activity and is not misleading, the government can still regulate comercial speech if it has a substantial interest in doing so, the restriction directly advances that interest, and the restriction is narrowly tailored to advancing that interest. FYI, a couple of years ago a court held that, under Central Hudson, the first amendment did not protect a sales rep's off-label promotion of Xyrem (United States v. Caronia, 576 F. Supp.2d 385 (E.D.N.Y. 2008), which I believe is currently on appeal.
Put up or shut up Blumberg. The FDA has been part of the fraudulent marketing scheme for years by approving dangerous drugs, covering up known side effects like suicide and violence from antidepressants and with a revolving door between this agency and PhRMA.
Until the FDA puts a drug company exec. in prison, it's just posturing. And with the US Dept. of Justice, the lawsuits are fine but the only time they went after drug company executives was with Purdue Pharmaceutical over oxycontin. And that only happened because the Western Virginia US Attorney bucked his D.C. office per reports.
When an off-label suit is successfully prosecuted/ settled, the highest level corporate officer that can be tied via evidence to such conduct should go to jail.
If I may ask a question. What about the culpability of the prescribing physician? Detail aids and slick talking sales reps do not write scripts, do they? One could say that the physician could be found negligent if they prescribed based on what they heard or saw without checking it out. Am I correct? I have no legal background, so I am asking this as a legitimate question.
Thanks.
NJLawyer-Thanks so much for your input. In all candor, this isn't what I was hoping to hear. But c'est la vie.
Hal Dol - I agree that FDA has been part of the problem, but it's really the DOJ that decides who to prosecute, and I agree with you that they have shown a reluctance to prosecute senior executives. This may sound jaded, but I believe that prosecutors have made a conscious and (short sighted) rationally economic decision: if they seriously threaten to prosecute CEOs and General Counsels (who make ultimate decisions regarding litigation and settlement), companies might fight even more aggressively and be less inclined to settle.
So, everyone -- other than the public -- wins: prosecutors get big settlements and publicity, and companies chalk up the settlement as a cost of doing business, blame some low level or departed employee and claim that they are now committed to transparency and legal conduct. And the government gets to prosecute the same companies again when the same management continues the same practices (hence some companies with two or three CIAs).
Will be interesting to see political fall-out if this were actually to happen.
NJLawyer- Great Points! However, couldn't the threat of such prosecution motivate these companies to settle quicker and for higher amounts?
Ie: DOJ goes to offending company and says we found xyz, showing the possibility that your CEO was involved. Settle now for this huge amount, and avoid jail time.
Don't settle now, and we will continue to investigate and we will prosecute to the highest limits of the law, including jail time for ALL of those found involved with the fraud.
Just a thought?
Shytown - It is my understanding that in several of these higher settlement cases, your idea is exactly what has happened. And yes, the companies pay big bucks to keep their execs out of jail. I have yet to see any CEO admit to knowing about the illegal behavior, yet I suspect they have known all along. Frankly, if you have market that has a $400 million dollar potential (if the therapy gets 100%) and the sales revenue for that year is $900, it really isn't rocket science to know that, at minimum, the company is getting $500 million from off-label sales. That level of off-label sales should be sending a red flag to the CEO.
Shytown and pharma marketer - I agree with both of you, and I think we're actually saying the same thing in different ways: while the government might pay lip service to going after senior executives, I don't foresee them actually getting a plea or conviction out of them, because it is in both the government and the executive/company interest to settle for dollars rather than fight over principle and individual criminal conviction.
K Kramer,
No one seems to have answered your question about the liability of the prescriber. I'm not a legal scholar, but it surely seems that diagnosing a condition requires that a certain standard of medical practice be acheived, and that consideration of treatment should include consideration of risk and benefit. In order to assess risk and benefit, a prescriber should certainly have a good understanding of the treatments available (not only the ones they "like" or have heard about). I believe there is an obligation (if not legal then certainly moral) resulting from the doctor-patient relationship that the precsriber should have sound reasoning to support their choice of treatment. I think there is a huge potential that (for example) the little kids who have been treated with antipsychotics will determine at their age of majority that they were harmed by the (off-label) treatments prescribed to them. This could be a big problem for some physicians in years to come (and a growth industry for med-mal lawyers). I do think that prescribers who go "off-label" without accurate diagnosis or exhausting standard treatment option face a liability problem.
However, that is just my opinion. All of that really means is that if one were a plaintiff (or plaintiff's attorney) I would be a welcome addition to the jury (if not a witness) for your complaint about being harmed by off-label use of medication.
I am curious what the actual legal scholars think on this.
Don't forget that all off-label use (and promotion) is not the same. In some cases there is a fairly decent set of evidence supporting the use proposed, but it hasn't been taken to the FDA. In others it all boils down to someone's opinion linked to a marketing manager's desire for increased sales.
There seems to be a general agreement that if you cry wolf and rarely follow through then the threat is "empty".
Talk is cheap.
If it actually happens, it's long overdue. These execs have been getting away with murder for years. They consistently have the company admit no guilt, pay the fine, and then walk to do it over and over again. These schemes make billions for the companies and they pay pittance back. However, the fines and jail times need to be significant and they must be barred from ever working in the industry again. None of these $100,000 fines and a year in jail. This is a joke! Pay back the money taken by the individual as a result of the deed and put them in jail for a significant amount of time. Disgrace them for what they've done!!!!!
Dr. Helm
Thank you for your response. Off-label use is something that is such a conundrum. On the one hand, it is like using a steak knife for surgery. Yes, it cuts, but it was created to slice a steak and not mesentery. On the other hand, a bright physician, one with a good understanding of the convergence of biology, physiology and pharmacology may discover something that could turn out to be a great find. One that could help millions. I just do not see this particular is in such black and white terms.
I do agree with one thing, off-label promotion is a bad thing. Reps and MSL are viewed as "knowledgeable" which imbues them with additional responsibility. Therefore, any off-label discussion between rep/msl and HCP could have disastrous consequences.
I really enjoy this forum for discussion.
I wonder how they are proposing to pin point the "right person who is exactly and directly responsible" for off label use in order to prosecute....
I think we will start seeing more executive prosecutions. Stryker Biotech and Synthes both have former executives facing charges.
How about prosecuting FDA management, who despite having documentation, continue to cover up side effects and crimes by Pharma? In my film GENERATION RX, I provide said documentation...and prove that Dr. Thomas Laughren (head of psychopharmacology for FDA) and others not only KNEW about the deadly side effects of Prozac and other SSRIs, but colluded with Lilly and others to create "talking points" to address the truth about those drugs.
And to those in the media who have been given this information (NY Times and others), you are as guilty as FDA and others for not bringing this vital information to the public.
Ken Kramer, the prescriber is not a "deep pocket." Even insured, the amount that is collectable is a pittance compared to the company's pockets.
Also, no drug company is going to support blaming a doctor, esp. one relying on the company information in good faith, for being naive enough to fall for a sophisticated, manipulative, untrue ad campaign by the billion-dollar company. After all, the company spent a fortune on the psychology of tricking their customers. That's almost as bad as blaming 13-yr-old for getting hooked on cigarettes.
I currently work at a pharma company in a relatively low level marketing auxilliary role (I don't have deep pockets - a $100,000 fine would more than wipe me out and my career would be destroyed). The topic of off label promotion is of high interest and generates much discussion among the people I work with. It makes for a very challenging work envirnoment.
Kevin Miller, thank you for your comment about the media's responsibility. This whole issue is very frightening, and how else will people know the truth until the media tells them? I wrote a book, e.g., about doctors' various unethical practises, and the publishers I approached wouldn't accept it because 'we don't want to say bad things about doctors.' So let's keep the public uninformed.
Prescribers are prosecuted all the time. Its called malpractice. Evidence based medicine only goes so far in actual practice. Medicine is an art not a science, and many effective treatments and interventions are "off-label."
Part of the problem with (relatively) civil society is that you can commit mass murder indirectly and get punished for it in a "civil" way, such as a fine.
Now that Pharma needs to go countries other than 1st world, you know like developing countries...
They have their own way of dealing with things over there.
Ed,
Great article. Thought you would like to know that OIG/HHS excluded another pharma exec--the Chairman and CEO of KV Pharmaceutical--this week from doing business with the government for 20 years. It was not for off-label violations, but manufacturing violations. But, still one step closer.
More here: http://wp.me/p12znw-iD
Maureen
Hi Maureen,
Thanks for the note and I actually did post an item about that yesterday on Pharmalot...
http://www.pharmalot.com/2010/11/pharma-exec-banned-from-federal-health-programs/
As of this writing, it still appears on the main page.
In any event, I appreciate that you took the time to write and pass along something interesting. Such gestures make the world go round.
All best, ed