Friday, May 30, 2008

Jeff Kindler's new Pfizer: Only Democrats need to apply.

Since Jeff Kindler took over as CEO of Pfizer he's kicked out pretty much everyone on the old management team and replaced them with his own acolytes. He's also changed Pfizer's political direction 180 degrees.

Observant readers may remember that I was first, writing for BrandweekNRX, revealing that Kindler supported Hillary Clinton for president, and was really a closet Democrat, which was a dramatic change from Dr. McKinnell who was a Bush Ranger and tried to force every employee to support the GOP.

Anyway, turns out in Kindler's new Pfizer only Democrats need to apply--at least that is what his recent hiring of Sally Susman and Amy Schulman would indicate; both of them have a perfect record supporting democrats, just like their new boss.

Pfizer Inc named Sally Susman Senior Vice President of Worldwide Communications and Chief Communications Officer with overall responsibility for Pfizer's global communications, reporting to Chairman and Chief Executive Officer Jeff Kindler last fall.

This week the company reported that Amy Schulman would become the new general counsel after Kindler pushed out Waxman who was told to retire for "personal reasons."

I guess if Dr. McKinnell was dead he would turn in his grave. But he isn't even on the Pfizer board so he has no say anymore and Kindler apparently couldn't care less what his old benefactor thinks. Funny thing is that Kindler pretended to support Bush at all those fancy fundraising dinners as long as McKinnell was around. I guess he was just biding his time to kick out all those conservative stalwarts.

Lesson of all this: Corporations are like tiny little kingdoms and the king does whatever he feels like. Usually he feels like hiring people who think like him, look like him (check out the pics above), and who come from the same background. No change in the last 10, 000 years.

Thursday, May 29, 2008

The Pharma Law Blog tops searches for Pfizer's General Counsel Amy Schulman

This is kind of funny:

Anyone who does a Google search on Pfizer Inc.'s new Super Lawyer, Amy Schulman, will find . . . The Pharma Law Blog.

Schering-Plough and Merck have managed to fool an estimated 75% of U.S. physicians.

Today in an SEC filing, Schering-Plough revealed that total prescriptions for disaster meds Vytorin and Zetia have dropped by more than 20% from January to April 2008.

Total number of prescriptions were 3,205,000 in January and 2,492,000 in April.

Most bloggers and commentators seem to think this is a dramatic drop.

Reality is that Schering-Plough and Merck have so far been able to retain over 75% of their market. Vytorin’s share of the cholesterol market went from 9 percent to 7.2 percent between January and April. And Zetia’s share fell from 6.7 percent to 5.5 percent.

That is the amazing fact--a drug that has not been proven to work, caused multiple congressional inquiries and major news coverage and it is still selling to the tune of billions of dollars!

Welcome to the world snake oil merchants and the people who help grease their machinery: Your friendly neighborhood doc, who continues to write all those scripts.

Women who can't dress for business, or the "sex effect."

In the WSJ today.

What gets me is the stereotypical description of how men react to women in this article.

Reality is a lot more complex than the simplistic view put forth by the--female--author.

But for women, ever since their prom, it was always the dress that was important.

To most men, they couldn't care less about the dress; they care about what's inside the dress. And that may be where some women get in trouble.

The truth is that the ones that really hate a slutty dress--are all the other women.

Wednesday, May 28, 2008

Pfizer share price lower than even Schering-Plough


Pfizer $19.30
Schering-Plough $20.09

Jeff Kindler: Way to go!

10-year chart to the left.

Are US citizens being conditioned to live in a police state?

That's a question some people are asking. (Not us, no siree.)

Those people (who think such things) did this video to prove their point, showing a law enforcement checkpoint nearly 50 miles north of the Mexican border, with US citizens who have done nothing wrong, being stopped and asked questions.

Check out what happens.

Some people claim the real purpose of these checkpoints is to condition Americans to get used to a future police state.

Dr. Rost available through the Round Table Group

Dear Dr. Rost:

I am pleased to inform you that you have been admitted to Round Table Group's expert network. Congratulations on your admission to one of the world's preeminent consortia of consulting experts.

You are joined by over 15,000 Ph.D. professors and industry experts who together form what has been called the "Mercedes-Benz of expert think tanks." The Wall Street Journal, which has profiled Round Table Group twice, calls RTG one of the few firms of true value for high profile companies seeking intellectual expertise. In November 2004, for the second consecutive year, Inc. Magazine named Round Table Group to its prestigious "Inc. 500" list of the fastest growing US private companies.

Round Table Group has also been featured in the Chicago Tribune, Boston Globe, and Crain's Chicago Business as well as in Fortune Magazine, the Chronicle of Higher Education, and a Stanford University business case.

Now that you have been admitted and your resume has been logged into our internal database, the process is simple and described accurately in the Chicago Tribune's 1999 profile: "3,000 scholars at your service...

Clients give Round Table Group an explanation of the project they have and the kind of expertise they need. Round Table, in turn, passes the word -- usually by email -- to [its] consultants who fall within the client's guidelines. Clients get the resumes of consultants who express interest, and the final choice is usually based on phone or face-to-face interviews."

I am confident that Round Table Group will provide challenging, rewarding, and lucrative experiences for you. Please do not hesitate to call me directly for any reason. I look forward to working with you.

Toby Edwards
Vice President of Operations
Round Table Group

Tuesday, May 27, 2008

Humans: Bags filled with dirty water.

So I just learned something.

We mostly consist of water. OK I already knew that.

But here's what I didn't know: We have about ten times as many bacteria in our body, as we have human cells.

Ten times, according to an article in the New York Times.

And we're like 70-80% water.

What does that make us?

An ecosystem equivalent to a bag of shitty water!

No wonder humans behave the way they do.

Saturday, May 24, 2008

If John McCain stops taking Vytorin . . . shouldn't you switch too?

John McCain's doc switched him from Vytorin . . . to generic simvastatin.

According to a pool report based on the review of the records, Mr. McCain’s cholesterol level was recorded as high in 2003, with a total cholesterol of 226 and an LDL, or harmful cholesterol, of 139, and an HDL, or good cholesterol, of 35.

Mr. McCain was put on Vytorin, a medication which worked in reducing his cholesterol in subsequent checks, but he was taken off earlier this year in the wake of reports that the drug may not work and might even speed up the growth of fatty plaques in the arteries.

Mr. McCain was instead put on simvastatin, which the records said did not reduce his cholesterol by as much but was deemed “acceptable.”

Friday, May 23, 2008


Dr. Rost is available as a pharmaceutical marketing expert witness in pharma, drug & healthcare litigation related to: Abilify, Accupril, Accutane, Acetaminophen, Aciphex, Actonel, Actos, Acyclovir, Adderall, Advair, Albuterol, Aldactone, Allegra, Allopurinol, Alprazolam, Altace, Amaryl, Ambien, Amiodarone, Amitriptyline, Amlodipine, Amoxicillin, Ampicillin, Apap, Aredia, Aricept, Aspirin, Atacand, Atarax, Atenolol, Ativan, Atropine, Atrovent, Augmentin, Avalide, Avandia, Avapro, Avelox, Azithromycin, Baclofen, Bactrim, Baycol, Benadryl, Benicar, Bentyl, Benzene, Beryllium, Bextra, Biaxin, Boniva, Bupropion, Buspar, Butalbital, Byetta, Caduet, Calcium, Captopril, Cardizem, Cardura, Carisoprodol, Celebrex, Celexa, Cephalexin, Cialis, Cipro, Ciprofloxacin, Citalopram, Clarinex, Claritin, Clindamycin, Clonazepam, Clonidine, Codeine, Colchicine, Combivent, Compazine, Concerta, Coreg, Coumadin, Cozaar, Crestor, Cyclobenzaprine, Cymbalta, Darvocet, Darvon, Decadron, Demerol, Depakote, Depo-Provera, Detrol, Dexamethasone, Diazepam, Diclofenac, Diflucan, Digoxin, Dilantin, Dilaudid, Diltiazem, Diovan, Diphenhydramine, Ditropan, Dopamine, Doxepin, Doxycycline, Drug-Coated Stents, Duragesic, Effexor, Elavil, Enalapril, Endocet, Enebrel, Entex, Ephedra, Erythromycin, Estradiol, Etodolac, Evista, Famotidine, Fentanyl, Fexofenadine, Fioricet, Flagyl, Flexeril, Flomax, Flonase, Flovent, Fluconazole, Fluoxetine, Fluvoxamine, Fosamax, Furosemide, Gabapentin, Geodon, Gleevec, Glipizide, Glucophage, Glyburide, Guidant Defibrillator, Haldol, Hctz, Heparin, Hydralazine, Hydrochlorothiazide, Hydrocodone, Hydrocortisone, Hydroxyzine, Hyzaar, Ibuprofen, Imdur, Imitrex, Inderal, Indocin, Indomethacin, Insulin, Isosorbide, Keflex, Keppra, Ketek, Klonopin, Lamictal, Lamisil, Lanoxin, Lantus, Lasix, Levaquin, Levitra, Levothyroxine, Levoxyl, Lexapro, Lidocaine, Lidoderm, Lipitor, Lisinopril, Lithium, Lodine, Lopressor, Loratadine, Lorazepam, Lortab, Lotrel, Lovastatin, Lovenox, Lunesta, 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Rost vs. Pfizer qui tam in The Pink Sheet

May 19, 2008
Volume 70 Number 020 page 23

Whistleblower Suits Alleging Off-label Promotion Need Not Be Specific – Gov’t

The U.S. government says whistleblowers do not need to provide specific details of misconduct in claiming a company marketed a drug for an unapproved use.

The government offered its interpretation of the laws governing off-label lawsuits in the case Peter Rost, former vice president of marketing at Pharmacia & Upjohn, brought against Pfizer over marketing of the human growth hormone Genotropin. While the government has declined to intervene in the litigation, it said it was interested in seeing the correct application of the law in this and other cases.

In a "statement of interest" filed with the U.S. District Court of the District of Massachusetts May 12, Acting Assistant Attorney General Gregory Katsas said the False Claims Act "should be read broadly to reach all fraudulent attempts to cause the government to pay out sums of money."

"I think the Department of Justice's statement is highly significant not only because it supports Dr. Rost, but also because it demonstrates that there are very important public policy issues at stake here," said Rost's attorney Mark Labaton, of Kreindler & Kreindler.

The government's filing could have an impact on other cases brought under the False Claims Act. Under this law, private individuals file qui tam, or whistleblower, suits on behalf of the government. It is the government's primary tool in pursuing health care fraud. There are about 150 pending whistleblower suits (1"The Pink Sheet," March 31, 2008, p. 15).

Rost claims Pharmacia - which was acquired by Pfizer in 2003 - fraudulently promoted Genotropin to treat short children and aging adults. The Massachusetts district court dismissed the suit on grounds that it failed to specify details of the alleged fraud. But in November the U.S. Court of Appeals for the First Circuit ruled that Rost could amend his complaint to include such information (2"The Pink Sheet," Nov. 26, 2007, In Brief).

Gaining Standing On "Short Stature" Claims

Rost submitted a revised complaint in January citing more than 200 Medicaid reimbursement claims for Genotropin with diagnosis codes indicating the treatment was for "short stature." The claims, covering the period 2001 to 2006, were for patients in Indiana.

In a motion to dismiss the complaint Pfizer said Rost "does not identify which physicians allegedly submitted these claims nor plead any facts suggesting that Pharmacia promoted Genotropin to these doctors at all, much less for an off-label use."

Pfizer also contends that "short stature" was listed as a therapeutic use in the drug compendium DRUGDEX even before the alleged Medicaid claims were filed and thus the claims were for a "medically accepted indication" and reimbursable under Medicaid.

Compendium Listing Is Not Enough

But the government dismisses this defense. "First, the fact that an off-label use is listed in a statutorily recognized compendium does not necessarily mean that the use is supported by the compendium citation, so that, in some circumstances, a use that is listed may not qualify as a 'medically accepted indication' that is covered by law," it states.

"Second, even if an off-label use is supported by a citation in a compendium, a claim nevertheless may be false for any other number of reasons (if sufficiently pled) and thus present an alternative ground for FCA liability."

The government would also give Rost leeway in citing specific claims of fraud. Under the Federal Rules of Civil Procedure a party alleging fraud "must state with particularity the circumstances constituting fraud."

"The identification of specific false claims is not an absolute prerequisite to satisfying the particularity requirement" in False Claims Act cases, the government states. "So long as the complaint as a whole is sufficiently particular to strengthen the inference of fraud beyond possibility, a court may conclude, as this one has in other cases, that Rule 9 (b) is satisfied."

Rost's attorney Labaton said this means that an individual filing an FCA suit does not need to provide the actual claim at the initial pleading to get discovery and get the case off the ground.

The government further states that a complaint does not have to allege that the defendants themselves made a false statement. Defendants "may be liable if they caused a third party to make a false statement to get a false claim paid," the government says.

DoJ Settlement Excludes Short Stature

Last year Pharmacia pled guilty to off-label promotion and receiving kickbacks from a pharmacy benefit manager for a contract to distribute Genotropin in a $34.7 million settlement with the U.S. Attorney's Office in Boston (3"The Pink Sheet," April 9, 2007, p. 3). Rost cites the settlement in his complaint, saying it resulted from the company's illegal marketing campaign.

But in a court filing in support of its motion to dismiss the complaint, Pfizer says the settlement with DoJ related to the promotion of Genotropin for anti-aging use by adults. "The settlement documents did not refer to the False Claims Act, to any pediatric use of Genotropin, or to use for 'short stature,'" Pfizer states.

Pfizer has faced other allegations of fraudulently promoting unapproved uses of a drug. In 2004 it paid $430 million to settle a Department of Justice investigation of off-label marketing of its epilepsy drug Neurontin (gabapentin). A class action is pending before the Massachusetts district court in which plaintiffs seek reimbursement for the off-label promotion.

Judge Patti Saris ruled last year that off-label prescriptions of Neurontin were approximately 13 percent of total scripts prior to the company's off-label promotion of the drug for pain, migraine and psychiatric use and 90 percent of total scripts after the off-label campaign.

Rost's amended complaint, in which he alleges more than one-fourth of Genotropin prescriptions to children were for unapproved uses, is before Judge Saris.

The Washington Legal Foundation filed an amicus brief May 1 in support of Pfizer's motion to dismiss Rost's amended complaint. WLF said if the suit is allowed to proceed it "could harm public health by reducing public knowledge regarding beneficial off-label uses of FDA-approved products."

- Brenda Sandburg (

DTC advertising

Hat tip: Senior law enforcement official.

The House Energy and Commerce Committee goes after Jeff Kindler in strongly worded letter.

The Committee on Energy and Commerce is going after Pfizer CEO Jeff Kindler in a strongly worded letter.

My article about flood of suicide and traffic accidents related to Pfizer's anti-smoking pill Chantix made front cover news in Sweden.

As some of you may recall, I spend some of my time writing for newspapers overseas . . . where the products is called Champix, not Chantix.

You can read the article in Swedish or translated with Google translate to broken English.

(The latter option provided as a courtesy to Pfizer.)

Thursday, May 22, 2008

Humankind - a bunch of monkeys

This video explains why the world looks the way it does. Brilliant.

Temptation averted.

The one thing that strikes me . . . those religious fanatics must be really, really, horny.

Why else would they've come up with any of this? AND they get to have four wives! That's just here on earth. In heaven they get 72 virgins, if they've been really good. That's a real horny religion.

By the way, compare this with the fundamentalist polygamist Mormons in Texas who also have tons of wifes and a gazillion kids each . . . one old goat for every five women. And the young men get kicked out so the old guys can supply themselves with young women without competition.

Let's face it, the problem with religious fanatics . . . they're just too horny for their own good.


Wednesday, May 21, 2008

Latest news from Fred Hassan's office

Hat tip: REDACTED.

Our Daily Meds by Melody Petersen

A few months back Melody Petersen's publisher Farrar, Straus and Giroux sent me a review copy of her new book, "Our Daily Meds" and it's taken a bit longer than I thought to finish this 432-page tome.

Others have clearly been faster; the book as been top 100 on Amazon for quite some time, and even New York Times has done a book review, so I'm really, really late.

Anyway, Melody Petersen wrote about the drug industry for four years when she was a reporter at the New York Times. I actually met her back in 2003, when she wrote the first major story on me. And I was just as surprised as everyone else when she suddenly quit the Times job. Turns out she followed her husband to Los Angeles, where he landed a job for LA Times. Melody, she wrote a book, and we are all very fortunate that's how she spent her time.

"Our Daily Meds" picks up where Marcia Angell left off with her book "The truth about the drug companies."

"Our Daily Meds" is written like a gigantic and very long New York Times article. It explores the misdeeds of the drug industry, focusing on personal stories in Melody's home state, Iowa.

In that state, drug companies "pitch drugs with video games and soft cuddly toys for children; publicize them in churches and subways, at NASCAR races and state fairs."

"Our Daily Meds" becomes Petersen's personal journey researching the drug industry and ends unequivocally with this statement in her last chapter: "No one knows how many Americans are buried without their families knowing the were killed by prescription drugs."

She bases this on the fact that out of Iowa’s 27,000 death certificates a year there were only five deaths recorded as adverse reactions to prescription drugs in 2002. Melody claims this is due to a massive cover-up.

"Much of the blame must be put on the nation's physicians, who have enjoyed the industry's gifts as their profession has been corrupted and patients have suffered," according to Melody.

Melody uses detailed real-life stories to create heart-warming accounts of people affected by drug industry marketing. And she uses hilarious quotes out of that marketing, such as this one: "Pace yourself" the Prislosec guide warned. "If you just polished off a funnel cake, don't immediately chase it with a chili-cheese dog."

That's drug marketing--in Iowa.

If you loved Angell's book, you will most certainly enjoy this one too . . .

GlaxoSmithKline Sweden changes Lamictal package insert and marketing after article in which Dr. Rost supports critics.

Here's the first article, Så luras vi att tro att vi är sjuka, and the second article, Backar efter avslöjandet, in which Glaxo does a mea culpa in one of Sweden's largest newspapers, Experessen.

If you want to read in broken English, use Google translate:

Article 1

Article 2

Tuesday, May 20, 2008

John McCain vs. John McCain

Life as a Lilly sales rep: Screwed no matter what you do.

Below is the real-life story of a Lilly rep who was recently terminated (names have been changed). Those of you who have read "Hard Sell" by Jamie Ready will recognize much in this tale:

Samantha was my District Manager from January 2005 through November 15, 2007. Samantha was a brand new manager when she took over the Camden District in 05', which was a new team all-together. Let me also state, Samantha never hired me, nor was she my original manager on September 19, 2005 when I began employment with Lilly. I was hired by the Northeast Area Director, as a Senior Sales Representative. This would be a point of contention with Samantha in the future, as she did not believe I could be leveled as such. The sales force was realigned for 2006 and Samantha became my District Manager.

During most of 2006, Samantha and I had a decent working relationship and I grew my sales number to the best of my ability. We didn't have any significant conflicts, but we were not always on the same page as far as how to make the sale to a physician. We had even talked about the possibilities of me moving to the corporate headquarters to become an associate and then a DM. She had me participate in a teleconference for perspective home office employees to hear all about the opportunity.

We agreed that September of 2007 would be the target date for the move. On an October field ride (a day in the field with your manager) I expressed I was anxious about how fast one of our products was increasing share in the territory and I was bothered and frustrated by this. I felt I could share my concerns with my manager, but this would soon be used against me. Unbeknownst to me, during 2006, LT was constantly tormenting an executive rep on our team about her sales style and abilities, which I would learn later in 2007. There was a pattern developing and would progressively get worse.

Before I continue with my story I want to point out another aspect to her poor ability to keep and promote quality, tenured reps. During Samantha's time as the DM, seven reps left her team, six with significant tenure in the industry. The first two left almost immediately when she began, one to another company, the other to another district upon her request. This particular rep would later say Samantha made racist comments. Specifically, "I can't move to Voorhees, there are too many Jews." This was when Samantha was deciding where to live when she moved from New York. The rep I am referring to is Jewish.

Two others moved different districts and three were fired, including myself. One was let go based on performance and was probably valid, yet Samantha made little attempt to coach and motivate to this persons strengths. The other one is more important to the events that led to my termination.

My colleague Alexis was a rep with Lilly for six years and an important part of our district. She was an excellent rep and her sales numbers over the years reflected this. Alexis was seen as the unofficial DM within our district and a real leader. This intimidated Samantha. Alexis went on maternity leave in December 2006. She arrived back on a Monday in early May and was terminated by Samantha that Friday. Alexis did make a product samples error back in 06' and she had contacted samples accountability before she went on maternity leave to address the error. Sampling mistakes are common and although serious, probation is usually the first warning.

On the Friday of the event, Samantha called Alexis to come to a hotel to meet about the error and HR would be on the phone. During their meeting, HR told Alexis her sampling mistake would cost her six months probation and supported this with documentation. After which, Samantha asked Alexis leave the room, a few minutes later she called her in to the room and told her she was terminated based on the sampling error and other information Samantha had collected, such as expense reports Alexis had submitted months earlier and other minor infractions that were never previously addressed to her. Samantha had spent months putting this together and it turns out to be very similar to how I went down as well. Alexis has a four year old and an infant, obviously Samantha was aware of the effects this would have on Alexis's family... yet put a plan in place while Alexis was out to have her fired. The worst part is she waited until the baby was born, instead of when she was pregnant. I'm sure for fear there could be a suit against Lilly for firing a pregnant woman.

After Alexis was fired, she set her sights on me, but let's go back to January of 2007. We had a district meeting at a diner. The meeting surrounded the team being more open and excited during our regional meetings, where often times the Northeast director or other higher-ups would attend our classroom sessions. Samantha wanted us to be like some other teams. When she asked what can be done about this, no one really would answer. I have heard from several colleagues who state that this was the real turning point in our relationship. I stated we took a queue from her. She acted very tight, not loose and overly business like when these people were in attendance. I said if she were more relaxed, so would we. That was it. From that day forward it was all down hill.

Two weeks later we rode together in the field. I told Samantha about an office where the physician was upset about my asking him why he chose another drug instead of mine. So again I was confiding in her about what to do and my frustrations with some physician habits to use generics or an older competitor, again this would come back to haunt me. On a call later that day, I told her exactly what my plan was for the call to a physician. His wife was on the medication we sold and I was going to ask him how she was doing. Long story short, she was uncomfortable during the call (I have a field note describing what she felt about the situation) and proceeded to yell and scream at me later before another call. That Friday, I was given a verbal warning (which was actually in writing) expressing that I was not being professional and overly aggressive with my doctors and I had a bad attitude with them. None of which is anywhere near the truth and I could go to any office right now and the physician would say I was pleasant, helpful and one of their best reps. This warning was just the beginning.

In any event, as the year progressed, my interactions with her became worse. My field visit notes were inconsistent. One time I was doing what she asked, the next I wasn't, the next I was and then the next I never had done anything she requested. She would say my sales skills were holding me back, yet I was the number one primary care territory every quarter that she was my boss. It got to a point where my peers were wondering why she never acknowledged any of my accomplishments and how mean and nasty she was to me at all times. How she was verbally aggressive and how anything I said was completely dismissed by her, or corrected. She frequently spoke negatively about me to my peers. This was also a pattern of hers. She always had negative things to say about another particular rep from the Atlantic City territory.
Finally, we rode together on Monday October 22, 2007. Again I told her my intentions for the day and proceeded with my plan. I actually felt it was a productive day considering a Monday with your manager type of day.

Physicians are not usually happy to see a lot of reps and Mondays is typically the worst day to be with your manager. Of course these were the only days Samantha usually wanted to ride with me. I thought things were going better with her as well until we stopped. She proceeded to tell me I needed to back to sales school, my sales ability was not good and we have never been on the same page about anything. After collecting some info from my peers about what she had said about me in the past and feeling worried that she was out to have me fired I contacted Lilly HR on Friday October 26, 2007.

I spoke with HR. I told them that I was afraid for my job and my manager was discriminating against me and wanted me fired. I recounted the pattern of her behavior, how she fired Alexis based on her tenure, any reps with tenure would leave, she wouldn't hire any tenured industry reps to replace them because as she told Alexis's old counterpart, "They were uncoachable." I talked about her erratic behavior and yelling screaming outbursts. How she offended some of my doctors and many told me never to bring her back. My team was also told the same thing. I explained some of her racist comments and how anyone with tenure always had issues with her. I told her how she talked about me negatively to my peers about me and some of the things she said were degrading and completely unprofessional. She would often swear when talking about me. One time in particular I was standing up for our team again and said that all of us (District mates) didn't have to worry about a particular metric the company was evaluating us on because we were all strong sales people. She told David, from the Camden team, "What the FUCK kind of comment was that and who the FUCK did I think I was! To Dave's credit , he defended me as to say I was just trying to keep our spirits up.

I told HR that my fate would be like Alexis's if she did not help. HR's advice was to work things out with her and sit down to talk about it. I never got the opportunity to do that. For the next two weeks, Samantha would not return my phone calls, or if she did, there would be some reason we could not meet. I even left her a message extending an olive branch in hopes to make amends and start fresh. I was conceding all power back to her. Finally on Monday October 11, 2007 she left me a voicemail saying we would meet at a particular hotel to discuss some things. The next morning I received another v-mail stating I should bring my lap top and HR would be on the phone with us at the hotel. I knew it was the kiss of death. I called HR that morning and begged for their protection. I reiterated the fact that I knew she wanted me gone and she would find any reason to do so. HR said she would pass on everything we talked about to the HR person who would be on the phone, but she never did.

The reason I was fired is this... I falsified calls to physicians, or I had too many detail only calls. I say this next part without hesitation, yes I did fake calls to some physicians on my call list to meet a frequency requirement of the company. So many calls to certain docs per quarter, whether you can see them or not. We were told by Samantha, "Make frequency work for you", WINK, WINK. We all new what that meant. Our district was always floundering in second to last place and she was on the hot seat with our Regional Director. SHE TOLD US TO LIE TO MAKE HERSELF LOOK BETTER.

She said "In order for us to look good, lets control what we can control by meeting frequency and calls per day." It is standard in this industry to have detail only calls and if I was fired for doing, so should 99.9% of the reps in the company and everyone in my district... especially if they had all of their calls scrutinized and Samantha knows this. Even though it is known by everyone in the industry and everyone in my District did it because we had talked about it... she found a way to fire me for it. The company required 30% samples to detail only calls, I made at least 7 to 8 sample calls per day out of the nine calls overall we were required to make. Basically, Samantha took the time to go back in my call history, knew which docs were "no see" and called their offices to learn if I was there on a certain day I recorded as a call back in the summer. She had about nine or ten different doctors she questioned me on.

My point is, if I wasn't being targeted to be terminated, why didn't she look at everyone's records. I know for a fact that everyone on our team puts in detail only calls when they don't see a doctor, so they can keep up with frequency and hopefully keep the manager off their back. I did not throw anyone under the bus during the meeting and would not say who else did this as well. It wasn't like I was forging signatures, or selling my samples. My territory went from 508 out of 510 in November 05' to as low as 275 out of 510 in January 07'. Coincidentally, that same month my product Cymbalta was 118% of goal and yet somehow I was upsetting all my doctors and I needed a verbal warning. No one on my team ever reached that number,... EVER!!! I have plenty of other documentation to support my success as a rep in the territory. My peers would also support me as a great rep and an asset to the company.

So they took my car and all my stuff from me on the spot and my pregnant wife and 4 year old twins had to pick me up, one week before Thanksgiving. I had a conversation with the HR person who was on the phone with us and he said there would be a formal investigation into Samantha as a manager. I have yet to receive a letter regarding the outcome and according to my friends from my old team, she is as nasty as ever. Nothing has or will happen to her.

My manager very, very aware that I was the sole provider for my family, that I struggled to make ends-meat and I was always worried about money. She knew my wife was pregnant and I had 4 year old twins..., yet she still had her number one primary care sales rep fired on a technicality based solely on her own insecurity. It was not performance..., it was personal.

Somebody, PLEASE help Schering-Plough

Susan Ellen Wolf, Corporate Secretary, Vice President Governance and Associate General Counsel of Schering-Plough has been posting messages on numerous pharma blogs (Pharmalot, WSJ, Forbes) after Forbes raised the question if Hassan should return some of the money he made a SP.

Here are a few of her statements:

Fred Hassan has a distinguished track record as a CEO who is virtually synonymous with integrity. We see this in his actions every day.

Fred Hassan also has a proven track record as a CEO who has taken a series of some of the biggest challenges in the world of business and turned them around to the benefit of patients, shareowners and society.

We are proud to have Fred Hassan as our CEO.

Seriously, doesn't anyone at Schering-Plough realize how bad this looks?

Does anyone at Schering truly believe that this will make the company look better or help Mr. Hassan?

It's like the mother, who's son was just convicted for a crime, stating "he's really a good boy"!

Ms. Wolf is completely dependent upon Mr. Hassan for her survival and job. She can be expected to say exactly what her master tells her to say.

She is essentially a puppet--for Mr. Hassan and what he wants to communicate.

The only conclusion is that Mr. Hassan is very worried that people will ask him to return some of the money he took from Schering-Plough.

Picture of the day

Vytorin - the ad.

Brought to you by the Condor.

Men thinking about nothing . . .

PharmaGossip had the short version today. Here's the long one. Don't miss it!

Bonus material: Men . . . in the morning:

Monday, May 19, 2008

Caught lying?: Susan Ellen Wolf, Corporate Secretary and Vice President Governance, Schering-Plough

My, my a Vice President Governance and Associate General Counsel Schering-Plough caught spreading untruthful information?

Or is it the 2007 Schering-Plough proxy that is untruthful?

Something for the SEC?

Story on Scherlings got Plowed.


The Vytorin Saga: Should Schering Plough's Chief Give Back His Bonus?

Hassan received $29.6 million in 2006, including a $19 million cash and stock bonus he is still receiving. That bonus was based largely on the Vytorin-driven increase in Schering's market cap. Though the options Hassan received are now underwater, he gets to keep his $9 million in cash, all of which would have been at risk had the stock tanked in November 2006, when Schering and Merck had intended to release ENHANCE at a medical meeting.

Study lead investigator John J. P. Kastelein of the University of Amsterdam says he would have had trouble making the deadline for the November meeting. But he believes if he had full control over the study, the results could have been presented in March 2007.

That would have put a set of cash bonuses for 2007 at risk if it had hurt the company's sales and earnings per share, potentially costing Hassan $4 million more.

In order for the 2007 bonuses to be paid, Schering had to grow sales by at least 12% and hit an earnings-per-share target of $1.10. In 2007, the company delivered sales growth of 16.8% and had earnings per share of $1.37.

Full story in Forbes.

Thursday, May 15, 2008

Red Cross allowed to keep its . . . red cross. J&J loses suit.

A federal judge last night ruled against Johnson & Johnson in its suit to stop the American Red Cross from using the Red Cross emblem on first aid and other health and safety products sold to the public. The judge’s ruling represents a complete vindication of the right of the Red Cross charity to use its emblem or authorize others’ use of its emblem in the sale of products related to its mission. The money the Red Cross receives from the sale of these products is reinvested in its humanitarian programs and services.

“The American Red Cross is pleased that the Court has upheld our right to use our trusted emblem to provide consumers with products that help protect their families’ health and safety,” said Mary S. Elcano, Acting President and CEO of the American Red Cross. “Whenever the Red Cross emblem can be used to advance our mission – whether flying above blood donation sites, worn by relief workers, or printed on emergency first aid kits – we will continue to display it proudly,” said Elcano.

“We have said from the beginning that Johnson & Johnson’s lawsuit is meritless, and we are gratified by Judge Rakoff’s ruling in our favor. We hope J&J will work with us to bring this dispute to a prompt end so we can focus on what’s important: delivering lifesaving Red Cross services to the American people,” added Elcano.

Judge Rakoff squarely held that the Red Cross’s activities “do not violate the criminal prohibition contained in 18 U.S.C. 706. They also do not violate the Red Cross’s congressional charter or the Geneva Convention,” contrary to J&J’s claims. According to Judge Rakoff, “For over a century … [the Red Cross] has entered into a number of arrangements to use the Red Cross emblem and words in an ostensibly commercial context – including, of particular relevance here, entering into license agreements that utilize the logo.” Indeed, Judge Rakoff found that “the doubtfulness of [J&J’s] interpretation is well illustrated by the ironic fact that in 1986 J&J itself entered into a cause-marketing promotional agreement with [the Red Cross].”

Today’s ruling marks the second major victory for the Red Cross since August 2007 when J&J first brought suit against the organization and four of its licensing partners for “unlawful conduct” related to how the Red Cross uses its emblem. The first victory in the case came in November 2007 when Judge Rakoff dismissed J&J’s claim that Red Cross had promised not to engage in the sale of mission-related products.

The Red Cross has been using the Red Cross emblem since 1881 and has been selling first aid kits and other safety and health products since at least 1903. By offering these Red Cross products at retail locations, the organization is able to reach more families.

Several claims and counterclaims remain for trial in the case, but none call into question the lawfulness of the Red Cross’s use of the emblem in providing consumers with first aid and other products. The Red Cross’s use of its emblem, and its authorization of others to use it in furtherance of its mission, has been entirely vindicated.

U.S. Gives Opinion On Qui Tam Pfizer Suit

Portfolio Media, New York (May 13, 2008)--The government has weighed in on Pfizer Inc.'s bid to dismiss a whistleblower lawsuit filed by a former executive alleging that the company illegally marketed human growth hormone Genotropin.

Under the False Claims Act, a complaint need not allege that the defendants made a false statement but merely that they caused a third party to make a false statement to get a false claim paid, said the motion filed Monday in the U.S. District Court for the District of Massachusetts.

"A statement urging a physician to prescribe a drug for an unapproved, off-label use could well amount to a half-truth and satisfy the false statement requirement ... where, for example, the drug sales representative fails to mention that the evidence does not support the drug's efficacy for the use he or she is promoting or the FDA has specifically concluded that the drug is not safe or effective for that use," the complaint said.

The government also said Pfizer is seeking too rigid a pleading standard when it contends that the amended complaint fails because it doesn't make specific false claims or do so with sufficient particularity.

However, the motion said that the U.S. was submitting the brief only to put forward its position on how to interpret and apply certain aspects of the Medicaid Act and the FCA. The government was not taking a position on the sufficiency of the complaint.

The suit brought by Dr. Peter Rost was given new life in November when the U.S. Court of Appeals for the First Circuit said that while he didn't meet the proper pleading requirements in his qui tam lawsuit, he should have been given an opportunity to amend his complaint.

The U.S. District Court for the District of Massachusetts had tossed the qui tam case in September 2006 for lack of jurisdiction.

In the False Claims Act suit filed in June 2003, Rost, a former Pfizer marketing vice president, accused Pfizer and its unit Pharmacia Corp. of off-label marketing for Genotropin, which allegedly boosted the company's sales by as much as $50 million in 2002 alone.

Rost claimed many of those sales came at the expense of the government through Medicaid, which generally does not give reimbursements for off-label uses.

Rost based his case on information from Pfizer and Pharmacia's marketing methods, but the district court found that Rost's case was only speculation.

The circuit court agreed with the lower court, saying that Rost's original complaint did not meet the pleading requirements but he should have been given a chance to amend.

Rost did so in January.

Pfizer and Pharmacia promptly moved to dismiss the complaint again, saying the amended complaint largely repeated the allegations that were already held to be deficient.

The government's brief filed Monday was in response to wrangling over the pending dismissal motion. The judge in the case also just allowed the Washington Legal Center to file a motion in support of the defendants' dismissal bid.

Mark I. Labaton, a lawyer with Kreindler & Kreindler LLP and counsel for Rost, said that the government's brief supports their position and shows that the issues raised in the case are important from a public policy standpoint.

A lawyer for Pfizer didn't immediately respond to a request for comment Tuesday.

A hearing on the motion to dismiss is scheduled for Monday.

Rost's suit was unsealed in November 2005 after the U.S. decided not to intervene in the case. Rost, who began working for Pharmacia in 2001, based his claims on several alleged practices by the drug companies.

Rost was fired from Pfizer in December 2005 after his complaint was unsealed. His allegedly wrongful termination became the subject of a separate lawsuit filed the same month in the U.S. District Court for the Southern District of New York.

The suit also resulted in a criminal investigation conducted by the U.S. attorney's office in Massachusetts. In April 2007, the office announced that Pfizer would plead guilty and pay a fine for violating an anti-kickback statute through Genotropin-related payments to doctors.

Pfizer paid $34.7 million to resolve Genotropin-related investigations conducted by the Department of Health and Human Services, the Department of Justice and the FBI.

Genotropin is FDA-approved for the treatment of children with hormone-related growth failure or with Prader-Willi Syndrome, and adults with growth hormone deficiency.

Rost is represented in this matter by Kreindler & Kriendler LLP.

Pfizer is represented in this matter by Covington & Burling LLP.

The district case is USA v. Pfizer Inc. et al., case number 1:03-cv-11084, in the U.S. District Court for the District of Massachusetts.

--Additional reporting by Erin Marie Daly and Ron Zapata

Wednesday, May 14, 2008

How much does R&D for a new drug cost?

The drug industry has for a long time claimed the cost is close to $1 billion.

Former NEJM editor Marcia Angell in her book "The truth about the drug companies" claimed the real cost was $100 million.

Now an unlikely source chimes in, in an interview in Realtid. Lennart Forslund is an expert from the Swedish FDA and in a very frank interview he claims "researching drugs is expensive as hell."

His price tag--SEK 1 billion, or about $150 million.

Deposition that ends with attack on camera man

Accusations fly. Lamps smack into heads. Woman falls to floor. Mayhem. Ends with attack on camera man.

First day lawyer punk'd at fake deposition

Watch what happens when a First Day Lawyer is thrown into a fabricated sexual harassment deposition with a wacko lawyer on the other side. Seems like lawyers do have some fun--with each other.

Tuesday, May 13, 2008


Below are some comments from other blogs on recent events related to:

PFIZER, INC., et al.,
Docket No. 03-CV-II084-PBS


peter-rost-4Last February, the controversial gadfly and former Pfizer exec cleared a hurdle in his ongoing whistleblower lawsuit against Pfizer. In a filing, Rost cited approximately 200 instances in Indiana which Genotropin, a human growth hormone, was marketed by Pharmacia (which was bought by Pfizer) for unapproved uses, such as combating aging in adults and treating short stature in children.

Providing such detail was needed for the case to proceed. And the move signaled two potentially significant developments. One is the long-term implication for Pfizer, should Rost ultimately prevail. The other is that his efforts may serve as a template for other whistleblowers who are similarly stymied by federal judges seeking details that are, otherwise, very hard to come by

Pfizer, however, last month turned around and argued that fraud was not involved because Genotropin was listed in three major pharmaceutical compendia, such as Drugdex and the US Pharmacopeia, which meant that state Medicaid programs would likely be required to issue reimbursements anyway. (These is a lot of background reading, but if you wish to do so, please look here, here and here).

Now, though, the Department of Justice, which declined to join Rost’s case, has taken a position favorable to Rost by filing a statement of interest, citing concerns with overall interpretation of law. (Look here). The motion is significant, because the DOJ essentially rebuts the key points Pfizer is using to get the case dismissed. By doing so, this may increase the likelihood that the case will proceed toward discovery.

In its filing, the DOJ argues that, even if an off-label use is listed in a compendium, that is not the same as being supported by the compendium citation. “….in some circumstances, a use that is listed may not qualify as a medically accepted indication that is covered by law,” the DOJ attorneys write.

The DOJ makes three other arguments against Pfizer’s position: even if an off-label use is supported, there may be other grounds for a false claim; Pfizer may still be liable if the drugmaker caused a third party to make a false statement or file a false claim; and that a complaint should sufficiently provide info about the inference of fraud beyond merely the possibilities, and is not always necessary to file particular info about false claims submitted to the government for payment.

Pharma Manufacturing:

DOJ Supports Peter Rost’s Appeal in Pfizer Genotropin Case

The Department of Justice is reportedly supporting Peter Rost’s appeal of the prior qui tam case.

To quote from the legal brief, “the allegation of a specific false claim is not an absolute prerequisite to pleading a viable FCA claim….The strength of the inference of fraud on the government may be measured by, for example, factual or statistical evidence tending to show fraud….The U.S. submits that it is not aware of any billable diagnosis code for anti-aging use that would be reimbursable by Federal healthcare programs….”

You can plow through the legalese yourself in the text pasted beneath this post.

Rost says he has decided to take a much more serious approach to his blog, which is now called the Pharma Law Blog. That’s in addition to his Expert Witness blog. He’d once likened his blog to an online pharma-related Colbert Report. Not so the new ones….”No more messing around,” he writes…

What, no more cheerleader drug rep photos? Promises to be interesting (and a whole lot more valuable, since the other pharma law blogs deal mainly with FDA, IP and issues other than sales and marketing).


Case 1:03-cv-11084-PBS Document 118 Filed 05/12/2008 Page 1 of 13






PFIZER, INC., et aI.,


Docket No. 03-CV-II084-PBS

The Honorable Patti B. Saris




The United States, real party in interest in this action, hereby moves to submit this Statement ofInterest pursuant to 28 U.S.C. § 517 to respond to certain arguments raised in the context of defendants’ Motion to Dismiss Relator’s First Amended Complaint. The United States remains a real party in interest in this matter, even where it has not intervened in the action. United States ex reI. Karvelas v. Melrose-Wakefield Hosp., 360 F.3d 220,231 (1st Cir. 2004). The False Claims Act (FCA), 31 U.S.C. § 3729 et seq., is the United States’ primary tool used to redress fraud on the government. As such, the statute should be read broadly to reach all fraudulent attempts to cause the government to payout sums of money. United States v. Neifert- White, 390 U.S. 228, 233 (1968). Thus, the United States has a keen interest in the development ofthe law in this area and in the correct application ofthe law in this, and similar, cases.4

4 The brief of amicus Washington Legal Foundation (WLF) offers this Court its views as to what information manufacturers of medical devices and drugs may lawfully disseminate about the off-label uses of their products. Defendants, however, do not seek dismissal ofthis case on the grounds that the off-label marketing alleged in the First Amended Complaint was lawful.

Case 1:03-cv-11084-PBS Document 118 Filed 05/12/2008 Page 2 of 13

The United States submits this brief to make four points. First, the fact that an off-label use is listed in a statutorily recognized compendium does not necessarily mean that the use is

supported by the compendium citation, so that, in some circumstances, a use that is listed may

not qualify as a “medically accepted indication” that is covered by law. Second, even if an offlabel use is supported by a citation in a compendium, a claim nevertheless may be false for any other number of reasons (if sufficiently plead) and thus present an alternative ground for FCA liability. Third, as to section (a)(2) ofthe FCA, which requires the existence ofa false record or statement to get a false or fraudulent claim paid or approved, a complaint need not allege that the defendants themselves made a false statement - the defendants may be liable ifthey caused a third party to make a false statement to get a false claim paid. In addition, false statements include not only affirmative misrepresentations but also material omissions so that the existence of either one may suffice to satisfy the false statement requirement of section (a)(2). Fourth, the identification of specific false claims is not an absolute prerequisite to satisfying the particularity requirement of Rule 9(b) in FCA cases. So long as the complaint as a whole is sufficiently particular to strengthen the inference of fraud beyond possibility, a court may conclude, as this one has in other cases, that Rule 9(b) is satisfied. Nonetheless, the United States submits that if WLF’s arguments have not been raised or briefed by the parties, are not relevant to the instant motion to dismiss, and need not be addressed by this Court. Indeed, WLF’s assertion that it “successfully challenged the constitutionality of certain FDA restrictions on speech about off-label uses and has in place a permanent injunction against enforcement ofthose restrictions” is incorrect. There is no permanent injunction against the enforcement ofFDA’s guidance as WLF asserts. Washington Legal Foundation v. Henney, 128 F. Supp. 2d 11, 15-16 (D.D.C. 2000) (denying WLF’s motion to confirm and enforce injunction, stating that the Court ofAppeals “vacated all ofthis Court’s previous constitutional rulings on the matter”).


Case 1:03-cv-11084-PBS Document 118 Filed 05/12/2008 Page 3 of 13

the Court finds that relator’s complaint fails to meet that test and is subject to dismissal under Rule 9(b), then it need not reach the other issues addressed herein.


In order to participate in the Medicaid program, a State must have a plan for medical assistance that has been approved by the Centers for Medicare and Medicaid Services (CMS), which administers the program on behalfofthe Secretary of Health and Human Services. The state plan must specify, among other things, the specific kinds of medical care and services that will be covered. 42 U.S.C. § 1396a(a)(1 0) and (17). If the plan is approved by the Secretary, the State thereafter is eligible for federal financial participation,

i.e., reimbursement by the federal government for a specified percentage of the amounts that qualify as medical assistance under the state plan. Id.

at §§ 1396b(a)(I), 1396d(b).

States are accorded a broad measure of flexibility in tailoring the scope and coverage of their plans to meet the particular needs oftheir residents and their own budgetary and other circumstances. While the Medicaid Act requires States to provide certain basic services, the Act permits, but does not require, States to cover prescription drugs, although most States choose to do so. 42 U.S.C. § 1396d(a)(12). In 1990, Congress enacted the Medicaid Drug Rebate Statute, codified at 42 U.S.C. §1396r-8, to “establish a rebate mechanism in order to give Medicaid the benefit ofthe best price for which a manufacturer sells a prescription drug to any public or private purchaser.” H.R. Rep. No. 881, 101st Cong., 2d Sess. 96 (1990). That statute prohibits federal financial participation for covered outpatient drugs unless there is a rebate agreement in effect under section 1396r-8. See 42 U.S.C. §§ 1396b(i)(10)(A) and 1396r-8(a)(I). Once a drug manufacturer has entered into


Case 1:03-cv-11 084-PBS Document 118 Filed 05/12/2008 Page 4 of 13

a rebate agreement for a covered outpatient drug, a State is generally required to cover that drug under the state plan. However, there are several provisions ofthe Medicaid Act that permit a State to exclude or restrict coverage, at least two of which are potentially implicated in this case. 42 U.S.C. § 1396a(a)(54); H.R. Rep. No. 881 at 97,98. A State may restrict from coverage or exclude altogether certain drugs or classes of drugs, or certain medical uses, such as drugs used for, among other things, cosmetic purposes. 42 U.S.C. § 1396r-8(d)(l)(B)(ii). A State also may exclude or restrict coverage of a drug where “the prescribed use is not for a medically accepted indication.” 42 U.S.C. § 1396r-8(d)(l)(B)(i).5 Under the statute, a “covered outpatient drug” includes a drug dispensed by prescription and approved as safe and effective under the Federal Food, Drug, and Cosmetic Act (FDCA), 21U.S.C. §§ 355

& 357, but does not include “a drug or biological used for a medical indication which is not a medically accepted indication.” 42 U.S.C. § 1396r-8(k)(2), (3). The statute defines “medically accepted indication” as: any use for a covered outpatient drug which is approved under the [FDCA], or the use of which is supported by one or more citations included or approved for inclusion in any ofthe compendia described in subsection (g)(1)(B)(i) of this section. Id. at § 1396r-8(k)(6). The three compendia described in subsection (g)(I)(B)(i) are the American Hospital Formulary Service Drug Information, the United States Pharmacopeia-Drug Information, and the Drugdex Information System. Id. at § 1396r-8(g)(l)(B)(i).

5In addition, under the terms set forth in the Medicaid Act, a State also may adopt a prior authorization program, maintain a formulary, impose limits on prescription quantities to discourage waste, and address instances of fraud or abuse by individuals. 42 U.S.C. § 1396r8( d)(4)-(6). It does not appear that any of these potential restrictions are at issue in this matter.


Case 1:03-cv-11084-PBS Document 118 Filed 05/12/2008 Page 5 of 13

I. The Term “Supported By” Requires That a Compeudium Citation Corroborate a

Particular Use.

One question raised by the parties here is what is necessary to satisfy the statutory requirement that a use is “supported by one or more citations” in a compendium. See id. at § 1396r-8(k)(6) (defining “medically accepted indication”). As both relator and defendants recognize, the mere existence of a compendium citation is not sufficient to meet this standard. Common usage ofthe term “supported by” generally requires some form of corroboration or validation. See American Heritage Dictionary of the English Language, 4th ed. (2000) (”to furnish corroborating evidence for”); Cambridge Dictionary ofAmerican English, 2d ed. (2006) (”to show (something) to be true … New evidence

supports his theory”); see,~, In re Pharmaceutical Indus. Average Wholesale Price Litig., 460 F. Supp. 2d 277,284 (D. Mass. 2006) (”Dictionaries ofthe English language are a fundamental tool in ascertaining the plain meaning of terms used in statutes and regulations.”). Interpreting the definition of medically accepted indication to require only “citation in the compendia” would be problematic because it would fail to give meaning to the words “supported by,” and would render that phrase superfluous. See United States v. Flores, 968 F.2d 1366, 1371 (Ist Cir. 1992). Furthermore, CMS, the agency with responsibility to administer the statute at issue, has reiterated that the statutory definition of medically accepted indication “requires coverage of off-label uses of FDA-approved drugs for indications that are supported (as opposed to listed) in the compendia.” See CMS Release No. 141 (emphasis added) (Attached to Relator Brief as Ex. 4). Because the agency’s interpretation ofthis statutory provision is reasonable, it is entitled to deference by this Court. See Federal Express Corp. v. Holowecki. et aI., 128 Sup. Ct. 1147, 1156 (2008). Moreover, a basic practical consideration is that Drugdex, the compendium relied on by


Case 1:03-cv-11 084-PBS Document 118 Filed 05/12/2008 Page 6 of 13

defendants here, classifies some indications as “not effective” and describes others as “controversial.” See Def. Brief at Ex. A. Accordingly, whether a particular use is “supported by” a compendium citation may depend on a variety of factors, including the type of drug and indication at issue, the compendium’s assessment of the drug’s efficacy in treating the indication, the content of the compendium citation, and the scope and outcome ofthe studies as described in the compendium. The only other case to have considered this provision, Edmonds v. Levine, 417 F. Supp. 2d 1323, 1339 (S.D. Fla. 2006), is distinguishable because ofthe circumstances in which the case was presented, and in particular because the decision predated CMS Release 141, which was released three months after the decision in Edmonds. The Edmonds case arose out of certain Medicaid beneficiaries challenging the State of Florida’s adoption of a policy to make an independent evaluation of off-label uses for the drug Neurontin that resulted in the State’s denying reimbursement for certain uses ofthe drug that were listed as effective in Drugdex, but allowing reimbursement for other uses listed as ineffective. The Court need not address the various issues raised in Edmonds stemming from whether the State’s action was permissible. The relevant point here is that, as both relator and defendants recognize and CMS Release 141 has made clear, the statutory language of”supported by” means something other than merely “listed in.”


Case 1:03-cv-11084-PBS Document 118 Filed 05/12/2008 Page 7 of 13

As a final issue relating to coverage, it should be noted that the Medicaid statute permits a State to exclude or restrict reimbursement of an otherwise “covered outpatient drug” in certain circumstances.6 See 42 U.s.C. § 1396r-8(d); supra at 3 & n. 1.

II. Coverage of an Off-label Indication Does Not Negate All Potential FCA Liability.

A claim may be false for any number of reasons regardless ofwhether it is submitted for a use supported by a citation in a compendium. For example, a claim may be ineligible for payment if a physician submitted a claim for reimbursement for which he received a kickback in exchange for prescribing a particular drug.

See,~, United States v. Rogan, 517 F.3d 449 (7th Cir. 2008); Parke-Davis, 2003 WL 22048255, at *7. Likewise, a claim may be ineligible for payment if the prescription were signed by a person without a medical license or for a patient that did not exist. See,~, United States ex reI. Riley v. St. Luke’s Episcopal Hosp., 355 F.3d 370,378-79 (5th Cir. 2004) (allegation that services were performed by an unlicensed and unsupervised physician states a claim under FCA). Finally, a claim may be rendered false if a drug manufacturer falsified studies or engaged in other unlawful, fraudulent conduct in the promotion of a drug or to procure FDA approval or inclusion in a compendium. See, ~ United States v. Dynamics Research Corp., 2008 WL 886035, *10 (D. Mass. Mar. 31, 2008) (”[W]here a claim for payment is the result of a fraudulent process-bid rigging, self-dealing, etc. such that the reliability and trustworthiness of a claim is compromised, the claim may be

6 Notably, this case does not present - at least not at this time - the question this Court left open in Parke-Davis as to whether States have discretion to cover off-label uses that are not supported by a citation in the compendia. See United States ex reI. Franklin v. Parke-Davis et aI., 2003 WL 22048255, at *3 (D. Mass. Aug. 22, 2003). The Parke-Davis defendants argued that States are permitted to cover prescriptions for off-label uses even if those uses are not supported by a citation in the compendia. In this case, defendants contend that the off-label indication of”short stature” is supported by compendium citations.


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considered false under the PCA despite its facial accuracy.”); United States v. Incorporated Village ofIsland Park, 888 P. Supp. 419,439 (E.D.N.Y. 1995) (”[T]he [PCA] is violated not only by a person who makes a false statement or a false record to get the government to pay a claim, but also by one who engages in a fraudulent course of conduct that causes the government to pay a claim for money.”). Thus, the mere fact that a particular use is a “medically accepted indication” does not eliminate the possibility of fraudulent conduct or abuse that could render the claim false and ineligible for payment.

III. False Statements Under Section (a)(2) of the FCA.

This Court has held that illegal off-label marketing that results in the submission of impermissible claims for reimbursement states a claim under the PCA. Parke-Davis, 2003 WL

22048255, at *2. PCA liability exists so long as the defendants knowingly cause a false claim to be submitted by a provider to the United States. Id. Proof of falsity could entail a showing that the provider sought payment from a federal health care program for a use that was off-label and not covered by that program. Id. at *3. It is not necessary also to show (or allege) an express falsehood from the defendant to the provider to satisfy the “falsity” element of section (a)(I). Id. at *1. Defendants correctly observe that to state a claim under section (a)(2), there must be a false record or statement. To satisfy this requirement, defendants assert that relator needed to allege “both that Pharmacia made a false statement and that this false statement was made to get a false claim paid by the government.” See Def. Brief at 11. However, requiring a false statement to be made by the defendant drug company is contrary to the plain language ofthe PCA. Although section (a)(2) requires the existence ofa false statement, it does not require the -8-

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false statement to be made by the defendant. Section (a)(2) imposes liability on a defendant so long as it “caused” another, such as a hired consultant, to make a false statement. Contrary to what defendants’ brief implies (Def. Br. at 11-12), for a statement to be “false,” it need not be an affirmative misrepresentation; a material omission will suffice: “[H]alf the truth may obviously amount to a lie, if it is understood to be the whole.” W. Page Keeton.Prosser & Keeton on the Law of Torts § 106, at 738 (5th ed. 1984); see Luckey v. Baxter Healthcare Corp., 183 F.3d 730, 732 (7th Cir. 1999) (observing that a half-truth may amount to a false statement under the FCA in certain circumstances); United States ex reI. Schwedt v. Planning Research Corp., 59 F.3d 196, 199 (D.C. Cir. 1995) (finding that false progress reports may constitute false statements under the FCA); United States ex reI. Fry v. Guidant Corp., 2006WL 2633740, at
*10-11 (M.D. Tenn. Sept. 3, 2006) (finding representation was rendered false by concealment of material information); United States ex reI. Kneepkins v. Gambro Healthcare. Inc., 115 F. Supp. 2d 35, 43 (D. Mass. 2000) (an “omitted material fact,” such as the existence of illegal kickbacks, may be actionable under the FCA). Thus, a statement urging a physician to prescribe a drug for an unapproved, off-label use could well amount to a half-truth and satisfy the false statement requirement of section (a)(2), where, for example, the drug sales representative fails to mention that the evidence does not support the drug’s efficacy for the use he or she is promoting or the FDA has specifically concluded that the drug is not safe or effective for that use.7
7 Notably, despite defendants’ suggestion to the contrary (Def. Br. at 11, n. 8), the fact that the Medicaid Act provides for coverage for off-label uses that are supported by citation in certain compendia is irrelevant to whether a drug company made a false statement. To the extent that the FDA Modernization Act, 21 U.S.C. § 360aaa, provided a safe harbor for the dissemination of certain scientific information if a manufacturer complied with the requirements


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IV. FCA Pleading Requirements.

Filed 05/12/2008 Page 10 of 13

Of course, if a relator is claiming that the defendant drug company caused the providers to submit these false claims, the relator must adequately allege such causation. See Parke-Davis, 2003 WL 22048255, at *4-5; United States ex reI. Cantekin v. University ofPittsburgh, 192 F.3d 402, 416 (3d Cir. 1999). The relator need not allege an express false statement to satisfy the causation element, though such evidence would be one way the relator could do SO.8

Defendants argue that relator’s complaint fails to set forth with sufficient particularity that conduct by defendants caused false claims to be submitted to federal health care programs. Defendants also argue the complaint does not sufficiently allege that the two off-label uses raised by relator (adult anti-aging and pediatric short stature) resulted in claims being submitted to federal health care programs that were false. Finally, Defendants further assert that relator has failed to identify specific adult anti-aging claims and that regardless of whether relator has identified specific pediatric short-stature claims submitted to federal health care programs, he set forth in the statute, the provision expired on September 30, 2006, and Congress has not renewed it. Moreover, the FDA draft guidance on

Good Reprint Practices for the Distribution of Medical Journal Articles and Medical or Scientific Reference Publications on Unapproved New Uses of Approved Drugs and Approved or Cleared Medical Devices states that it contains “Nonbinding Recommendation, Draft - Not for Implementation” and that the FDA is accepting comments on the draft.

8 WLF wrongly suggests that the defendant must have instructed or directed that claims be submitted or how to do so in order for liability to exist for “causing” the submission ofa false or fraudulent claim. As the Supreme Court has recognized, the prototypical FCA case involving the “causing” of the submission of a false claim - when a subcontractor submits a false invoice to a prime contractor which, in tum, submits the invoice to the United States - rarely involves a subcontractor affirmatively instructing or directing the prime contractor to submit a false claim. See United States v. Bomstein, 423 U.S. 303, 309 (1976); Marcus v. Hess, 317 U.S.537, 544-45 (1943). -10-

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has failed to provide sufficient details about those claims.9 To the extent that defendants contend that relator’s complaint must fail because it did not identify specific false claims or do so with sufficient particularity, defendants seek to impose too rigid a pleading standard in FCA cases. As a general matter, the allegation of a specific false claim is not an absolute prerequisite to pleading a viable FCA claim. Although FCA liability attaches to the claim for payment, the First Circuit and this Court have held that whether specific claims must be identified for a complaint to satisfy Rule 9(b)’s particularity requirement will depend on the circumstances of each case. See United States ex reI. Rost v. Pfizer, Inc., 507 F.3d 720, 732 (Ist Cir. 2007); United States ex reI. West v. Ortho-McNeil Pharm., Inc., 2008 WL 435497, at *18 (D. Mass. Feb. 19, 2008). Thus, in off-label cases, where the alleged false claims were submitted not by the defendant, but instead by a third party, a relator “need not allege the details of particular claims, so long as ‘the complaint as a whole is sufficiently particular to pass muster under the FCA.’” See Rost, 507 F.3d at 732 (quoting Karvelas, 360 F.3d at 225).10 In evaluating such

9 Whether the requisite knowledge under the FCA was sufficiently plead does not appear

to be a focus of defendants’ brief and, in any event, questions relating to a defendant’s knowledge typically cannot be resolved at the pleadings stage of a case. Accordingly, the Court need not address this issue. It bears noting here, however, that if a defendant knew or acted with reckless disregard as to the truth or falsity of claims that they caused to be submitted, “any possible ambiguity in the regulations is water under the bridge.” Minnesota Ass’n ofNurse Anesthetists v. Allina Health System Corp., 276 F.3d 1032, 1053 (8th Cir. 2002). 10 Such an analysis is consistent with FCA cases in which courts have found that when a complaint sets forth with particularity allegations of a fraudulent scheme or course of conduct, it is not also necessary to identify specific claims because doing so adds little to the sufficiency of the complaint as a whole. See,~, United States ex reI. Singh v. Bradford Regional Medical Center, 2006 WL 26425 I 8, at *7 (W.D. Pa. 2006) (”[T]he falsity of the instant claims does not turn on anything unique to any individual claim or that would be revealed from an examination of any claim, but rather the claims ‘are false because ofthe improper financial arrangements


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matters, “the strength ofthe inference of fraud on the government” may be measured by, for example, factual or statistical evidence tending to show fraud beyond possibility. See West, 2008 WL 435497, at *18. Given the posture ofthis matter, the unique circumstances ofthe drug at issue in this case, and to assist the Court in applying the standard here, the United States submits that it is not aware of any billable diagnosis code for an anti-aging use that would be recognized or reimbursable by federal health care programs.


The United States submits this brief regarding how to interpret and apply certain aspects ofthe Medicaid Act and the FCA. The United States takes no position on the sufficiency ofthe complaint herein.

Respectfully submitted,





/s/ Sara Miron Bloom

SARA MIRON BLOOM Assistant U.S. Attorney Suite 9200, One Courthouse Way Boston, MA 02210 Phone: (617) 748-3265



Civil Division, Commercial Litigation Branch P. O. Box 261, Ben Franklin Station between [defendant] and the physicians.”‘). -12-

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Dated: May 12,2008 Washington, D.C. 20004 Phone: (202) 353-0426