Healthy Skepticism Library item: 12344

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Publication type: news

Amgen sales reps sue drugmaker
CNN Money.com 2008 Jan 9
http://money.cnn.com/2008/01/09/news/companies/amgen_lawsuit.ap/index.htm?source=yahoo_quote

Abstract:

Suit alleges biotech company searched private medical records for potential customers violating federal patient privacy law.

Full text:

Two former sales representatives for Amgen are suing the biotech company, alleging it pushed its sales force to search doctor’s confidential medical records for potential patients to boost sales of a drug used to treat psoriasis.

The two former representatives, who are seeking lost pay, punitive damages and other compensation totaling more than $15 million apiece, allege they objected to superiors and refused to go along with the scheme, which legal experts say violates federal patient privacy law.

In addition, the veteran sales reps were encouraged to get insurance companies to approve reimbursement for Enbrel for patients with mild psoriasis, their attorney, Lydia Cotz, said Wednesday.

Enbrel, an injected, genetically engineered drug, is only approved for use in patients with moderate to severe psoriasis; it has severe side effects in some patients, including occasionally fatal infections. The drug is also used to tread rheumatoid arthritis.

One of the sales representatives, Elena Ferrante of Montvale, N.J., was fired in August 2005, while the other, Mark Engelman of Laguna Niguel, Calif., resigned last year after Cotz said he received a negative performance review.

The lawsuits are being handled through national arbitration services, because Amgen requires in its employment contracts that disputes be settled that way, Cotz said. Ferrante’s case was filed in October in New York and Engelman’s was filed in mid-December, she said.

Amgen spokesman David Polk said in a statement that the company “does not comment on pending litigation or personnel matters. Our sales creed emphasizes that Amgen sales representatives follow compliance guidelines with absolute consistency.”

Cotz said the New Jersey attorney general’s office is investigating and has interviewed Ferrante.

Jeff Lamm, a spokesman for state Attorney General Anne Milgram, said the office never confirms or denies the existence of such investigations.

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Milgram last fall convened a task force to investigate how the doctor-patient relationship is affected by the widespread practice of drug and medical device makers giving physicians gifts and fees for researching, consulting and speaking about their products.

Jim Cohen, a Fordham University law professor specializing in legal ethics and criminal law, and John Thomas, a health law professor at Quinnipiac University School of Law, said that accessing patient medical files violates the federal Health Insurance Portability and Accountability Act, known as HIPAA.

Cotz said the scheme started in 2005 or sooner, after new drugs competing with Enbrel came on the market. Enbrel, one of Amgen’s top sellers, had sales of nearly $3 billion in 2006.

“Amgen stepped up their marketing practices to … get all these people who were not indicated for Enbrel” to start taking the drug, she said. “Patients didn’t even know what was going on.”

Cotz said her clients were instructed to go into dermatologists’ offices and get permission to go through files to identify patients with psoriasis based on the diagnostic coding system insurers use for reimbursement. The representatives were told to then call insurers covering patients with mild psoriasis to seek approval for reimbursement of Enbrel, which Cotz said costs $20,000 to $50,000 per year, depending on the severity of the sometimes-painful skin condition.

“They would get on, and they wouldn’t identify themselves as Amgen (AMGN, Fortune 500) representatives. They would say, ‘I’m calling on behalf of Dr. so-and-so,”’ Cotz said.

She said representatives also were told to write letters on behalf of doctors, seeking advance approval so doctors could write prescriptions for Enbrel. Doctors writing prescriptions would benefit from frequent patient visits to have the drug injected.

“Respondents (Amgen) unethically and in contradiction of the available scientific data, promoted the prescription of Enbrel for “mild” cases of psoriasis by reinterpreting “moderate” cases” as mild, the lawsuit states, in “a total disregard of the proper care of patient recipients of Enbrel.”

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Cotz said sales representatives from the northeast to Hawaii have confirmed the scheme’s existence.

Thomas said the allegations, if true, implicate any physicians who went along with the scheme for authorizing “marketing of medication not designed to treat their patients.”

Cohen noted that HIPAA contains very tough sanctions for disclosing someone’s health information – up to 10 years in jail and a $250,000 fine if the information was transferred or used for commercial advantage.

A hearing has not yet been scheduled in the case, but could occur in February.