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Crooked Practices That Are Destroying Our Health Care System

March 2012

By William Faloon

William Faloon
William Faloon

Article reviewed & critiqued by Stephen B. Strum, MD, FAC P, LE Scientific Advisory Board Member

Crooked Practices That Are Destroying Our Health Care System

Health care corruption is driving this nation into economic insolvency.

A particularly disgusting method used to inflate drug prices is the filing of frivolous lawsuits against generic drug makers. Each day a court delays approval of a lower-cost generic can enable a pharmaceutical company to earn millions of dollars in illicit revenue.

It thus becomes cost-efficient for pharmaceutical companies to initiate limitless made-up claims against generic makers knowing that legal fees are far less than the profits earned each extra day that its expired-patent drug retains market exclusivity.

The filing of lawsuits against generic manufacturers for the purpose of delaying FDA approval has gone on for years. Once the generic maker defeats the imaginary claims, it then has to charge more to the consumer because of the millions of dollars it was forced to squander on legal fees. This is just one reason why generic drugs cost far more than they should.1-11

As Americans are painfully aware, runaway medical costs are adversely impacting every segment of the US economy. Government health care programs are mathematically insolvent, medical insurance premiums are at unprecedented levels, and consumers are shouldering a far greater portion of their health care with out-of-pocket dollars.12,13

How the Corrupt System Operates

When considering whether to approve a generic drug, the FDA is caught in the middle as pharmaceutical companies who own name-brand drugs create myriad obstacles to deny others the right to sell generic versions.

A pharmaceutical company with an expiring patent may pay enormous legal and lobbying fees to file petitions with the FDA arguing why it is not in the public interest to allow a low-cost generic to compete. Generic companies then have to respond by paying their own legal and lobbying costs to make their counterargument. The FDA plays referee in what often turns out to be a multi-year battle between a large pharmaceutical company and generic makers.14

None of this bureaucratic waste would occur in a free-market setting, but our cowardly Congress has failed to enact reforms—measures that Life Extension® long ago proposed to eliminate the corrupt behavior that routinely transpires between drug companies and the FDA.15,162

How the Corrupt System Operates

Depraved Behavior Sinks to New Level

As unproductive as these generic drug wars are, a Senate investigative panel has uncovered misdeeds that brings this depraved behavior down to a level of immorality that may shock even ardent supporters of today’s broken health care system.

Lovenox® is the brand name of a low-molecular weight heparin drug used to treat venous blood clots, pulmonary embolism, and various forms of arterial thrombosis. Back in 2002, ® suggested that its anticoagulant properties could benefit cancer patients by preventing acute thrombotic attacks, while reducing metastatic potential by blocking pro-angiogenic factors.17,18 As a result of its efficacy against a wide range of ailments, global sales of Lovenox® topped $4 billion in 2009.19 Its maker, Sanofi SA, desperately wanted to stifle generic competition as it was about to lose patent protection.

Sanofi first tried to hold off generic competition by filing a suit in federal court intended to block FDA approval of generic versions made by other companies. After this delay tactic failed in two court cases, Sanofi then filed a safety petition with the FDA alleging that it was against the public interest to allow a low-cost generic to be sold.20

To further bolster its case, Sanofi encouraged doctors and medical associations to contact the FDA and express concern about the safety of generic versions of Lovenox®.21,22 While these underhanded maneuvers have become commonplace amongst pharmaceutical giants, Sanofi was caught red-handed acting at a level of unprecedented decadence.

Sanofi Pays Fees to Third Parties to Mislead FDA

Realizing FDA was not capitulating to its intensive lobbying efforts, Sanofi used payments of almost $5 million to induce influential groups to contact the FDA and support its petition to deny other companies the right to sell generic Lovenox®.23

Sanofi made the following “donations” to third parties24:

  • $2.6+ million to the Society of Hospital Medicine
  • $2.0+ million to the North American Thrombosis Forum
  • $200,000+ to a Duke University Professor

In exchange for these and other payments, the FDA was lobbied with seemingly impartial concerns about the safety of generic Lovenox®. The purpose of these FDA contacts, of course, was to argue against approval of generic alternatives to Lovenox®. If successful, Sanofi would continue to earn billions of dollars from a drug that long ago lost patent status.

What upset the Senate investigative panel, however, was that none of these ostensibly unbiased third parties had disclosed to the FDA that they had been paid by Sanofi to support the lucrative Lovenox monopoly. The FDA was misled into believing that these parties had legitimate safety concerns, when in reality they functioned as paid shills whose mission was to assist Sanofi in maintaining its multi-billion gusher at the expense of Medicare, Medicaid, health insurance premium payers and ultimately, the American consumer.

The Duke University professor denied the monies he received from Sanofi had anything to do with him contacting the FDA, but admitted he should have reminded the FDA of his financial ties to Sanofi in his letter arguing against approval of generic Lovenox®.25

According to the Senate investigative panel conclusions, Sanofi “planned a coordinated strategy to delay generic alternatives to its blockbuster blood-thinner drug Lovenox.®26

Calls for Mandatory Transparency

Calls for Mandatory Transparency

Pharmaceutical influence within the FDA is common knowledge, but Sanofi’s financial contributions to third parties and other actions raised red flags as to the scientific integrity of the generic drug approval process. These payments made by Sanofi to third parties provided these supposedly independent groups incentive to contact the FDA to express what appeared to be unbiased concerns about generic alternatives to Lovenox®.

The strategy took advantage of the FDA’s citizen petition process, which allows individuals and experts to raise these kinds of safety concerns. While the process is intended as a channel for gathering public input into important agency decisions, the Senate investigative committee was infuriated by this egregious abuse of process.

“If the FDA isn’t asking for disclosure of financial relationships, it’s operating from an uninformed standpoint,” said one of the Senate committee members that exposed this deceit. This Senator went on to state that “The FDA has a responsibility to conduct due diligence in this area in order to make sure its reviews have credibility.”26

The chairman of the Senate committee took it a step further and stated, “This report uncovers evidence that paying off doctors to lobby the FDA against generics was a drug company strategy—and that’s wholly unacceptable.”26

While the Senate investigative committee expressed outrage over Sanofi’s shady behavior, Life Extension members have long been informed about how these kinds of insidious scandals are bankrupting this nation’s health care system.16,27-30 The harsh reality is that conflicts of interest within the FDA preclude the agency from making scientific decisions about products that affect whether Americans live or die.

Three Current Flawed FDA Methods of Operation
Three Current Flawed FDA Methods of Operation
The reason so many drugs approved by the FDA later turn out to be dangerous or ineffective is the inherently corrupt collaboration that exists between pharmaceutical companies and the FDA. Here are three reasons why serious reform is needed:

1) PROBLEM: FDA panel members are part-time employees and cannot perform with optimal due diligence to review new drugs and/or devices presented to the FDA.

RESULT: Drugs or devices are rejected inappropriately or approved inappropriately.

SOLUTION: Given the billions of health care dollars already spent and the problems with premature approval or rejection, the employment of an FDA panel member should be a full-time position. Moreover, what constitutes “conflict of interest” should be explicitly defined and no conflict of interest, whatsoever, should be permitted. In other words, it is not enough to state you are on the payroll of a pharmaceutical company and therefore all is well. If you are being paid to do research or paid to speak on behalf of a pharmaceutical company, or in any way have ties that would alter full objectivity of a decision for or against, that should be grounds for recusing yourself from the FDA matter on review. This rule should be unwaveringly enforced!

2) PROBLEM: FDA panel members receive a significant portion of income from drug research in their institution funded by a pharmaceutical company whose product may be up for review. That presents a situation which represents a flagrant conflict of interest.

RESULT: Drug approvals or rejections are often based on financial bias, not the underlying science.

SOLUTION: Zero tolerance for any conflict of interest for those who serve on an FDA drug advisory panel. Panel members should not be funded by any pharmaceutical company nor have any remote potential conflict of interest in voting yea or nay. An objective evaluation of the scientific merit of a device or drug cannot be rendered in the face of ulterior motives, be they at a conscious or subconscious level.

3) PROBLEM: FDA panel members are paid by pharmaceutical companies to make presentations at conferences and at national society meetings.

RESULT: This is not only a conflict of interest but it also influences the decision-making relating to the approval and prescribing of a particular drug.

SOLUTION: If a physician-scientist is on a lecture circuit and being paid by a pharmaceutical company, they should not be allowed to sit on an FDA panel that decides on the approval of a drug made by the pharmaceutical company. The solution for most of these problems is simple: an FDA panel member should not have any involvement—blatant or remote—in any company seeking approval for a product.

Pfizer Conceals Suicidal Side Effects

A side effect of many FDA-approved drugs on the market today is their propensity to sharply increase suicide risk.

For those who don’t know, suicide is the 8th leading cause of death (for persons aged 55-64) in the United States.31 Depression is a leading underlying medical cause of suicide. The fact that many anti-depressant drugs now require black box warnings of increased risks of suicide is a testament to horrific side effects these drugs inflict.

Many users of anti-depressant drugs report they feel more depressed after taking them (or encounter other side effects), which begs the question as to how these drugs ever gained FDA approval in the first place.32-37 In many instances, the increased risk of suicide was later found to be covered up by pharmaceutical companies during the initial approval process.38,39

Chantix® is the brand name of a drug made by Pfizer and approved by the FDA to help people stop smoking cigarettes. Chantix® works by altering brain chemistry to reduce nicotine craving. A side effect of this brain chemical alteration is an increased propensity to commit suicide, along with other psychological impairments.40-42

Not wanting to interfere with the lucrative sales of this drug, Pfizer devised a method to conceal the reports of suicide—reporting that is a mandatory requirement of the FDA. Rather than identifying the reports of suicides, suicide attempts, depression, aggression, and hostility in users of Chantix®, Pfizer instead mixed them among some 26,000 records of non-serious side effects such as nausea and rashes.42-46 This prevented the FDA from identifying a trend of serious adverse effects that were occurring in Chantix® users.

Pfizer was accused by the FDA of submitting these adverse reports through “improper channels” that made it impossible for the agency to determine that so many serious adverse reactions to Chantix® were occurring.45,47 Thomas J. Moore, an official at the non-profit Institute for Safe Medication Practices stated “We’ve had a major breakdown in safety surveillance.”45 In sworn testimony, Chantix® was described as causing twice as many reported fatalities as any other drug. Pfizer responded by stating there is no proof that Chantix® causes suicides or other side effects.45,46

FDA Black Box Warning
FDA Black Box Warning

In response to increased suicides in children (and adults) prescribed certain anti-depressant drugs, the FDA has mandated the following warning:

Contact your doctor if your child experiences any of the following while taking antidepressants:

  • Thoughts about suicide or dying
  • Attempts to commit suicide
  • New or worse depression
  • New or worse anxiety
  • Feeling very agitated or restless
  • Panic attacks
  • Difficulty sleeping (insomnia)
  • New or worse irritability
  • Acting aggressive, angry or violent
  • Acting on dangerous impulses
  • Extreme increase in activity or talking
  • Other unusual changes in behavior or mood