Showing posts with label health care. Show all posts
Showing posts with label health care. Show all posts

Thursday, November 05, 2015

Health Care in America - Increasing Criminal and Civil Monetary Penalties Against the Pharmaceutical Industry

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The Broken American Health Care System

Rapidly Increasing Criminal and Civil Monetary Penalties Against the Pharmaceutical Industry: 1991 to 2010

Sammy Almashat, M.D., M.P.H, Charles Preston, M.D., M.P.H, Timothy Waterman, B.S., Sidney Wolfe, M.D.

Public Citizen’s Health Research

Group EXECUTIVE SUMMARY

Background

U.S. spending on prescription drugs has increased from $40 billion in 1990 to$234 billion in 2008. In this era of rapidly rising drug costs, the illegal pharmaceutical company activities that have contributed to such inflated spending have garnered a significant amount of media attention. Recent billion-dollar settlements with two of the largest pharmaceutical companies in the world, Eli Lilly and Pfizer, provide evidence of the enormous scale of this wrong doing.  However, the total size, varied nature, and potential impact of these illegal and potentially dangerous activities have not been previously analyzed. This study examined trends from 1991 to the present in federal and state criminal and civil actions against pharmaceutical companies in order to address these questions.

Analysis

The purpose of this study was to compile a comprehensive database of all major criminal and civil settlements between federal and state governments and pharmaceutical companies. Press releases from both federal and state governments, in addition to existing online databases, were used to identify all settlements of at least $1 million during the past 20 years.


Main Findings

  • Of the 165 settlements comprising $19.8 billion in penalties during this 20-year interval, 73 percent of the settlements (121) and 75 percent of the penalties ($14.8 billion) have occurred in just the past five years (2006-2010).
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  • Four companies (GlaxoSmithKline, Pfizer, Eli Lilly, and Schering-Plough) accounted for more than half (53 percent or $10.5 billion) of all financial penalties imposed over the past two decades. These leading violators were among the world’s largest pharmaceutical companies.
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  • While the defense industry used to be the biggest defrauder of the federal  government under the False Claims Act (FCA), a law enacted in 1863 to prevent defense contractor fraud, the pharmaceutical industry has greatly overtaken the defense industry in recent years. The pharmaceutical industry now tops not only the defense industry, but all other industries in the total amount of fraud payments for actions against the federal government under the False Claims Act.
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  • The practice of illegal off-label promotion of pharmaceuticals has been responsible for the largest amount of financial penalties levied by the federal government over the past 20 years. This practice can be prosecuted as a criminal offense because of the potential for serious adverse health effects in patients from such activities.
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  • Deliberately overcharging state health programs, mainly Medicaid fraud, has been the most common violation against state governments and is responsible for the largest amount of financial penalties levied by these governments. This type of violation is also the main factor in the considerable increase in state settlements with pharmaceutical companies over time.
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  • Former pharmaceutical company employees and other “whistleblowers " have been instrumental in bringing to light the most egregious violations and have been responsible for initiating the largest number of federal settlements over the past 10 years. From 1991 through 2000, qui tam (whistleblower) cases made up only 9 percent of payouts to the government, but from 2001 through 2010, they comprised 67 percent of total payouts.

Conclusion

Over the past two decades, especially during the past 10 years, there has been a marked increase in both the number of government settlements with pharmaceutical companies and the size of the accompanying financial penalties.  The reasons for these increases are likely related to a combination of increased violations by companies and increased enforcement on the part of federal and state governments.  The danger to public safety and the loss of state and federal dollars that comes with these violations require a more robust response than the government’s current practices. Given the relatively small size of current financial penalties when compared to the perpetrating companies’ profits, both increased financial penalties and appropriate criminal prosecution of company leadership may provide a more effective deterrent to unlawful behavior by the pharmaceutical industry.

Worst Offenders and Largest Settlements

Individual Companies: Total Penalties, 1991-2010

There are 20 pharmaceutical companies that paid a total of at least $100 million each in financial penalties over the past 20 years. The four worst offenders, with at least $1 billion in penalties each, were GlaxoSmithKline, Pfizer, Eli Lilly, and Schering-Plough. Together they accounted for more than half (53percent) of all financial penalties paid out by pharmaceutical companies.

Twenty Largest Settlements, 1991-2010

The 20 largest settlements over the past two decades follow. In the largest settlement of the past 20 years, GlaxoSmithKline agreed to pay the federal government $3.4 billion in 2006 for failing to pay required taxes over a 17-year period.

The second and third largest settlements included the two largest criminal fines ever levied by the federal government against any company. In January 2009, Eli Lilly was forced to pay $515 million (the largest criminal fine ever received by a corporation at that time) and Pfizer, later that year, was fined$1.2 billion (the largest criminal fine ever imposed in the U.S.). Both companies were fined for illegal off-label promotion.

The majority (14) of the 20 largest settlements have occurred within the past five years (2006-2010), consistent with the dramatic increase in pharmaceutical industry financial penalties in recent years.  Of note, almost all cases (16 of 20) involved violations of the federal FCA, at least in part. Multiple blockbuster drugs (i.e., those with sales exceeding $1 billion per year), such as Neurontin (gabapentin), were involved in these settlements. For example, in the Pfizer case of 2004, the company was charged with illegal off-label promotion of Neurontin, a drug which in 2002 generated 94 percent of its $2.27-billion revenue from off-label use.

Table 2. Pharmaceutical Company Penalties: Worst Offenders


Company - Fine in millions of dollars - Percent of Total


GlaxoSmithKline                                     4501              22.7

Pfizer                                                            2935             14.8

Eli Lilly                                                        1712               8.6

Schering-Plough                                      1339               6.8

Bristol-Myers Squibb                             890                4.5

AstraZeneca                                               883                4.5

TAP Pharmaceutical Products            875                4.4

Merck                                                           806                4.1

Serono                                                          704                3.6

Purdue                                                         620                3.1

Allergan                                                      600                3.0

Novartis                                                       524                2.6

Cephalon                                                     425                 2.1

Johnson & Johnson                                353                 1.8

Forest Laboratories                                313                 1.6

Sanofi-aventis                                           310                 1.6

Bayer                                                            301                 1.5

Mylan                                                           267                 1.3

Teva                                                              181                 0.9

King Pharmaceuticals                          167                 0.8

Other                                                          595                 3.0

*Parent company names are current names without corporate (e.g. inc. or plc) designations. If company is non-existent now, name at time of most recent settlement was used.**Data for 2010 include only the first 10 months of the calendar year (through Nov. 1, 2010)***Percent of $19.813 billion in overall penalties. Percents do not add up to 100% as some cases were excluded due to inability to determine individual company share in settlement.
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Health Care in America - "Corruption at the Core of the Collapse

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The Broken American Health Care System

What is the driving force behind the failure of the most expensive heath care system in the world to provide a better quality of life?  A lot of us have opinions.  So do the media, politicians and academia, but none seem to be addressing the reason behind every failure of an institution like medical care in society.

There comes a point when the institutions no longer serve the purpose they were created to address.  They evolve to a position where they believe the survival of the institution is more important than the mission of the institution.

When that happens, and inevitably it will when all good causes become their own bureaucracy, we have the seeds of corruption planted.


In America we spend about 9.9% of our disposable income on food.  Thirty years ago we spent 15% of our disposable income, meaning we spend over 5% less today on food than thirty years ago.

Now compare that to our experience with health care costs.


An article  was written June 28, 2009 by George Will titled: "Americans Will Regret Health Care Fix".  It described the cost of health care in America as follows.

The Hudson Institute's Betsy McCaughey, writing in The American Spectator, says that in 1960 the average American household spent 53 percent of its disposable income on food, housing, energy and health care. Today the portion of income consumed by those four has barely changed -- 55 percent. But the health care component has increased while the other three combined have decreased. This is partly because as societies become richer, they spend more on health care -- and symphonies, universities, museums, etc.

It is also because health care is increasingly competent. When the first baby boomers, whose aging is driving health care spending, were born in 1946, many American hospitals' principal expense was clean linen. This was long before MRIs, CAT scans and the rest of the diagnostic and therapeutic arsenal that modern medicine deploys.

In a survey released in April by NPR, the Kaiser Family Foundation and Harvard, only 6 percent of Americans said they were willing to spend more than $200 a month on health care, and the price must fall to $100 a month before a majority are willing to pay it. But according to Grace-Marie Turner of the Galen Institute, Americans already are paying an average of $400 a month.

Most Americans do not know this because the cost of their care is hidden. Only 9 percent buy health coverage individually, and $84 of every $100 spent on health care is spent by someone (an employer, insurance company or government) other than recipients of the care. Those who get insurance as untaxed compensation from employers have no occasion to compute or confront the size of that benefit. But it is part of the price their employers pay for their work.



During the past thirty years health care as a percentage of our gross domestic product has grown by more than ten times.  That does not include your taxes paid for the government expenditures on health care.  The cost now is over $2.6 trillion a year and rising, both in terms of treatment and insurance.

Make no mistake, health care, long a public service through churches, non-profit organizations, government owned facilities and other resources, has now become BIG BUSINESS.

Pharmaceutical corporations led the way into making health care a profit center, not a public service, and now virtually every aspect of our health care system is privately owned, profit centered, and financed by Wall Street.


Wall Street may be reasonably good at financing new businesses like the Internet companies and health care industry but once Wall Street takes control of the industry through controlling the financing, that company serves a new master, Wall Street profitability.

Before you get out your protest banners and decide to occupy hospitals, I mean it is fashionable to protest against anyone we think is ripping off the public, look in the mirror because you are the one embracing a system now under the control of the financial institutions.

My point is this.  Health care is more about serving Wall Street interests than the people's interest.  Of course this is America and we encourage capitalism and these health care capitalists are operating within the framework of the law.  I guess if you owned stock in enough health care companies you would be profiting from the gouging of the American public with excessive health care costs, but most of us don't own health care stocks.


Our health care industry has evolved to the point where moral and financial corruption permeate the entire system, even corrupting those in the industry who really want to help people.

The medical industry is dependent on funneling millions in campaign funds to politicians who have to vote on their funding, in bribing doctors to prescribe drugs, in bribing universities to compete on a cut throat basis for grants from private corporations for survival, and for encouraging doctors to own testing equipment which in turn has to be justified to keep.

Conflicts of interest and ethics issues dominate the health care landscape.  It has become so financially competitive that excessive and unnecessary treatment is the order of the day as a simple and nearly undetectable way to pad the revenue stream.


Why X ray a single tooth if you can X ray the whole mouth?  Why take one or two spinal X rays when you can take multiple X rays of the spine?  Why not set up follow up doctor appointments for reasons of billing for the office visits rather than transmitting test results?

If a drug company pays a doctor to prescribe their drugs, and the more drugs prescribed the more the doctor makes, don't you think more prescriptions will be written?

How can FDA employees fairly evaluate a New Drug Application (NDA) worth potentially billions of dollars in new revenue if the same employees can quit their jobs and go to work for the same drug companies for far more money?

The top five drugs in terms of sales revenue in America all make between $3 and $5 billion a year for the owners, the pharmaceutical company.  If new health research or treatment does not generate profits first and foremost, it is of little value to a profit driven health care system.

If congress or the president eliminated conflicts of interest in the industry, both in terms of the relationship between government workers and the industry and between the industry and practitioners, it would be a great start to cost reduction.


The same conflict of interest exists when doctors are convinced to own expensive equipment like CAT scan and MRI machines, blood laboratories, pharmaceutical offices and others.  If Medicare or a health insurance company allows excessive CAT scans and MRI analysis for the purpose of making sure people are diagnosed and the doctors own the machines, don't you think more screens will be prescribed?

There are a thousand and one ways to get caught in a conflict in an industry that is barely regulated.  Usually there are industry watchdogs like the Securities and Exchange Commission assigned to keep an eye on the system.  However, even they are subject to the same conflicts because the SEC failed to see the housing and banking crisis coming.  More than likely they just turned their back to it.

A comprehensive and fair conflict of interest law could be proposed by the president and approved by congress and a thorough ethics law could be adopted by the medical and health care industries and that would start to unscramble the layers of conflicts and ethics violations we face today.


Unfortunately, such leadership by our politicians and health industries is nonexistent and will be as long as the industry finances the political campaigns in Washington and through the nation.  So we also need campaign financial reform, meaningful reform, to fix that inherent problem.

Fix the conflict of interest, draw up enforceable ethics laws, and clean up the campaign finance mess and it will lead directly to reduced health care costs.  Once again, nothing has been proposed by politicians to correct this mess.

Isn't it about time to REALLY start fixing things?

CPT Master Subject Index - Health Care Issues

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The Broken American Health Care System Article Index

October 14, 2013
Health Care in America - "Corruption at the Core of the Collapse"
 
 

 
June 14, 2013
Obamaville - June 14, 2013 - The Midterm Check Up
 
 

 
March 07, 2012
Health Care in America - Illegal "Off-Label" Conspirators
 
 
March 06, 2012
Health Care in America - Increasing Criminal and Civil Monetary Penalties Against the Pharmaceutical Industry
 
 
 
March 06, 2012
Health Care in America - Big Pharma Convictions in Civil and Criminal Courts
 
March 06, 2012
Health Care in America - Big Pharma Fraud, Cover Ups & Corruption
 
 
February 29, 2012
Health Care in America - The Sword of Damocles - Antibiotics
 

 
February 21, 2012
Health News You Can Use - Stay Informed & Stay Alive
 

 
February 15, 2012
Did You Hear About This in the News?
America's Legal Drug Addiction
 

 
February 06, 2012
Health Care in America - "Corruption at the Core of the Collapse
 

 
February 03, 2012
Health Care in America - "Possible Side Effects" Warnings
 

 
January 31, 2012
Health Care in America - Where Politicians Fear to Tread
 

 
May 14, 2010
Now that we have a health care bailout - how about an American Health Care Reform?
 

 
May 13, 2009
The Health Industry Capitulation - This Sure Ain't No Pythagorean Theorem

 

Wednesday, October 21, 2015

Hillary says she is most proud Republicans are her enemy. Compares members of the GOP to NRA, health insurance companies, drug companies, and the Iranians.

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If Republicans are her proudest enemy, what does that make Independents?

In the most recent Democratic Presidential candidates debate at CNN, CNN's Anderson Cooper asked, "which enemy are you most proud of?"

Clinton replied

“In addition to the NRA, the health insurance companies, the drug companies, the Iranians, probably the Republicans.”


Never has a presidential candidate demonstrated such polarization toward an entire group of politically affiliated people as Hillary did when she condemned the entire Republican party to being her enemy.


As for the Independents who are already fed up with political polarization, Hillary seems to have slammed the door on them as well.  Independents are already fed up with politicians and after Hillary spoke we know why.


Most polls show 50-75% of the voters are still somewhat undecided on who to vote for in the general election.  Well Hillary sent a clear and concise message to the Republicans and Independents in that category that she considers them the enemy.


Of course, that is just one half of the impact from what she said as her statement also included a holier than thou claim health insurance and drug companies are also enemies and she is proud of it.


As you will also note from the following articles, the health and drug companies have showered Hillary, and Bill, and the Clinton Foundation with millions of dollars in contributions.  Perhaps she should have said "now that I fleeced the health and drug companies, they no longer serve me any purpose.  I got the millions!", cackle, cackle.


Did anyone else note that she has developed a cackle like the Wicked Witch of the West?  I first noticed it in the debate.  You take millions and condemn the donors.  With all accounts paid up why not, it keeps the progressives and liberals from looking at her contributors since she is the newly incarnated Queen of Progressives, at least until she wins the democratic nomination.


Once she takes the big primary prize then she will start becoming a conservative like her husband who stole the Republican platform in 1992 to run on and to use while president.


It worked once for the Clintons, why not work again?  Still, there is something to be said for a little laughter in politics and the bevy of photos in this article show you the lighter side of the Washington drama kings and queens.




Hillary Takes Millions in Campaign Cash From ‘Enemies’

Clinton named the drug and insurance industries among her “enemies,” but has accepted millions in donations from them.

By Kimberly Leonard Oct. 14, 2015 | 4:25 p.m. EDT

When asked during the Democratic presidential debate what enemies she was most proud to have made, Hillary Clinton named pharmaceutical and health insurance companies at the top of her list. But that hasn’t stopped the Democratic front-runner from accepting millions of dollars in campaign cash from both industries in the course of her political career, financial disclosure records show.


Since her first bid for Senate in 2000, Clinton has accepted nearly $1 million from drug and health companies and more than $2.7 million from the insurance field and its related sectors, according to an analysis of public records from the Center for Responsive Politics. While the analysis did not include campaign finance figures for the 2016 cycle, some of the same donors and patterns can be seen in Clinton’s lone financial disclosure filed in July.


Contributions tied to some of the same firms that gave to her 2008 presidential campaign appear in the latest disclosure, including donations connected to pharmaceutical companies Pfizer Inc., Johnson & Johnson, Bristol-Myers Squibb Co.; and insurers Aetna Inc., MetLife Inc. and Centene Corp., the latter of which is among Clinton’s largest donors this year.  
In the course of her 2008 presidential bid, records show that Clinton was the third-largest recipient of campaign donations from drug and health product companies, receiving $738,359 in donations. The industry also contributed $86,875 to her 2000 Senate run, and spent $157,015 supporting her re-election in 2006.


The insurance industry – which includes health insurers and also car, life and property insurance – donated $1,260,400 to her 2008 campaign, making her the third-highest recipient of cash from the industry that year and also in 2006, when she raised $397,110 for her re-election to the Senate. During her first bid for the Senate in 2000, she raised $167,550 from the industry.


She was the second-highest recipient of cash in 2008 from the health services sector and HMOs, receiving $636,670, and the highest earner in 2006, at $183,770. In 2000, she raised $70,575. 

More recently, the Clinton Foundation has also benefited from these groups’ donations. Donors and grantors who have given between $1 million and $5 million include Pfizer, the Procter & Gamble Co., Blue Cross Blue Shield of North Carolina and Humana Inc.
But Clinton seems to have turned on the pharmaceutical industry in particular in recent weeks, releasing a plan to improve on President Barack Obama’s health care law, the Affordable Care Act, by tackling drug costs. The plan includes allowing Medicare, the government’s health plan for adults over 65 and disabled Americans, to negotiate lower drug costs – a measure the industry heavily opposes.


Her policy proposal also stated that she plans to reduce the amount of time a pharmaceutical company has exclusive rights to biologics, which are drugs made of living cells that are expensive to develop and can be difficult for patients to afford. Though she supported the bill that led to a 12-year exclusivity while in the Senate, her new proposals say she would reduce the patent to seven years, allowing the drug to be copied by other manufacturers and therefore reducing its price. Drugmakers are against this proposal, saying they need to recoup the massive costs of developing the drugs and to invest in new treatments and cures.

When Clinton was secretary of state, she supported the Trans-Pacific Partnership, which includes provisions that strengthen patent protections for drugmakers. Last week, however, she said she opposes the deal.


When asked for a response to Clinton calling the pharmaceutical industry “enemies,” Tina Stow, a spokeswoman for the Pharmaceutical Research and Manufacturers of America, or PhRMA, said the group has a long history of supporting and working with candidates and policymakers on both sides of the aisle.

“We will continue to do so as we look to advance a pro-patient, pro-innovation, pro-jobs agenda,” she wrote in an email. PhRMA has publicly come out against Clinton’s plan for prescription drugs, saying it would restrict patients’ access to medicines, result in fewer new treatments, would cost jobs and would end the country’s standing as a leader in biomedical innovation.


It’s unclear to what extent insurers and drug companies will continue to support her campaign, particularly after the comments during CNN’s debate, although it would not be the first time Clinton has been at odds with the industries.

Asked to explain the financial relationship between Clinton’s campaign and the industries, campaign officials pointed to the contentious war fought against Clinton when she was first lady and head of the Task Force on National Health Care Reform in 1993. The health insurance industry ran millions of dollars of ads against a health care plan she championed that would have overhauled the system, playing a large role in ultimately killing it. They also point out that her positions to tackle drug costs have been unpopular among pharmaceutical lobbying groups, which could help to demonstrate she ultimately isn’t beholden to the industry’s interests.


In total, Clinton raised $245.8 million for her 2008 presidential run, $51.6 million for her 2006 Senate campaign and $30.2 million for her 2000 Senate bid.

Pharmaceutical companies and insurers are typically generous with members of both parties, giving slightly more to Republicans. Clare Krusing, press secretary for America's Health Insurance Plans, says its political action committee supports candidates of both parties and, in particular, candidates who support policies aligned with the industry's priorities around affordability.


In recent years, both industries have contributed more to Democrats. Obama was the top recipient during the 2008 presidential election, and again during his re-election in 2012, with his Republican opponents – first Mitt Romney, then Sen. John McCain – receiving slightly less from pharmaceutical companies.



 International Business Times

Wednesday, October 21, 2015 As of 7:52 AM EDT

Democratic Debate 2015: Hillary Clinton’s ‘Enemies’ In Pharmaceutical and Insurance Industries Have Supported Her Campaigns, Foundation



Bill Clinton famously tried to parse what the meaning of “is” is -- and now his wife, Hillary Clinton, seems to be challenging the precise definition of “enemies.”
In an exchange toward the end of the Democratic presidential debate in Las Vegas on Tuesday, the candidates were asked who their biggest enemies had been over the course of their careers. Clinton responded by saying, “In addition to the NRA, the health insurance companies, the drug companies, the Iranians -- probably the Republicans.”

It is true that the National Rifle Association and the Republicans have been Clinton’s nemeses, and she has been involved in tense negotiations about international policy toward Iran. But health insurance companies and drug companies have been some of her biggest financial supporters.
In 2008, Clinton was the among the three biggest recipients of campaign cash from pharmaceutical-related companies, according to data compiled by the Center for Responsive Politics. In all, the watchdog group reports that she raised $738,000 from employees of pharmaceutical manufacturers and companies classified as “Pharmaceuticals /Health Products.” The center reports that Clinton also raised more than $1.2 million from the insurance industry -- which includes health insurers.

On top of those campaign contributions, the Clintons and their family foundation have benefited from their ties to the pharmaceutical and insurance industries.
In 2011, the Pharmaceutical Research and Manufacturers of America (PhRMA) -- the primary trade association representing drug companies -- paid Bill Clinton $200,000 for a speech, as the organization was lobbying the Hillary Clinton-led State Department. Last year, the Drug Chemical and Associated Technologies Association, a trade group whose members include major pharmaceutical companies, paid her a $250,000 speaking fee.

Meanwhile, the Clinton Foundation has received between $1 million and $5 million worth of donations separately from drug manufacturers Pfizer and Procter & Gamble, and from health insurers Humana and Blue Cross Blue Shield of North Carolina. Some of those companies made donations as recently as this year, according to the foundation’s website.
That largesse was part of a friendship forged after those industries opposed her 1993 health care initiative -- and which continued after she won reelection to the Senate in 2006.

As secretary of state, Clinton repeatedly championed the Trans-Pacific Partnership, which critics say includes provisions that strengthen patent protection for drug manufacturers. (Last week, she declared that she now opposes the trade deal.) As a presidential candidate in 2008, she promoted the idea of a federal mandate effectively requiring Americans to buy private health insurance.
Those Clinton positions were strongly supported by the same drug and insurance industries that she now calls “enemies.”