Life Science Compliance Update

February 13, 2017

Drug Wholesalers to Pay $36 Million Over West Virginia Pill Mill Claims

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Two prescription drug wholesalers – AmerisourceBergen Corp. and Cardinal Health Inc. – will pay $16 million and $20 million, respectively, to resolve West Virginia’s claims relating to their distribution of controlled substances in the state, according to Governor Earl Ray Tomblin. The settlement – in which neither company admitted to any wrongdoing – is believed to be the largest pharmaceutical settlement in state history, after lawsuits dragged on for more than four years in Boone County Circuit Court and spanned the terms of two attorneys general.

In 2012, McGraw filed lawsuits against Cardinal Health, AmerisourceBergen and a dozen smaller drug distributors for their role in a drug supply chain that includes doctors who write prescriptions for nonmedical purposes and “pill mill” pharmacies that dispense excessive numbers of painkillers. Attorney General Patrick Morrisey inherited the case upon taking office in January 2013.

These deals are the latest in several settlements stemming from a case brought against more than one dozen companies by the attorney general’s office, along with the Department of Health and Human Resources and Department of Military Affairs and Public Safety.

The settlement money will go toward drug treatment programs to help West Virginians addicted to opioid drugs, such as heroin and prescription painkillers. The money will be kept in a special account at the State Auditor’s office. Gov. Tomblin said, “We’ve taken steps to combat drug abuse in West Virginia with distributors, prescribers, and pharmacists, and the money from this settlement will help us expand those efforts with additional treatment and long-term recovery options.”

In addition to the settlement payments, Cardinal Health and AmerisourceBergen agreed to promptly alert state authorities when they see suspicious drug orders from pharmacies.

“We believe that the best possible way to manage this issue is to encourage drug distributor customers, like pharmacists and physicians who work directly with patients, to prescribe and order pain medications responsibly and appropriately,” said Gabe Weissman, an AmerisourceBergen spokesman. “Simultaneously, we will continue to do our part to provide the safe and efficient distribution network that ensures product availability for the treatments that preserve or enhance quality of life for patients with legitimate needs, while working with all partners to limit and prevent abuse.”

Cardinal Health has said that its hydrocodone and oxycodone sales make up only a small fraction — about 7 percent — of its total doses of prescription drugs shipped to West Virginia. Hydrocodone is sold under brand names like Lortab and Vicodin. Oxycodone is known better under its OxyContin brand name.

“While the company denies the state’s allegations, Cardinal Health recognizes that the epidemic of prescription drug abuse is a multifaceted problem driven by addiction and demand,” the drug wholesaler said in a news release.

Previous settlements, with nine smaller wholesalers, have netted the state more than $11 million.

Last January, Morrisey’s office sued McKesson Corp., the second-leading prescription opioid shipper to West Virginia. That case remains stuck in federal court, with no settlement expected anytime soon.

The state’s settlement with Cardinal Health and AmerisourceBergen won’t end all litigation the companies face in West Virginia. In late December, the McDowell County Commission filed suit against those firms and McKesson, alleging the wholesalers contributed to the county’s opioid epidemic by shipping far too many pain pills there.

November 23, 2016

Emanuel Announces Efforts to Combat Opioid Abuse Including Registering Pharmacetical Sales Reps

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In early October, Chicago mayor Rahm Emanuel announced a “series of efforts to combat heroin and opioid addiction throughout Chicago.” According to a press release on the City of Chicago’s website, “these proposed efforts would increase the City’s annual investment in addiction treatment by 50 percent…and create improved regulation of pharmaceutical representatives.”

Chicago seems to place much of the blame on pharmaceutical representatives marketing to medical professionals. As such, Mayor Emanuel proposes to “establish a pharmaceutical representative license above the current Limited Business Licensing required for these individuals in Chicago.”

Chicago seems to be following in the footsteps of Washington, DC, noting that “pharmaceutical representatives will be required to receive additional training and education and provide the city with information on opioid sales and marketing.” Through this extra licensing, the city would enable medical professionals to report complaints against pharmaceutical representatives for deceptive and/or unethical behavior and monitor, audit, and adjudicate such complaints. Part of the additional training would focus on prescription abuse, ethics, and marketing practices from programs certified by the city.

Sometime this month, the city expects to introduce an ordinance that would require the extra licensing. The city is also considering requiring pharmaceutical representatives to track which doctors they contact, and potentially supply names to the city upon request. The ordinance would also require licensed representatives to record the number of health providers they contact and the drug information they offer, keep track of when and to whom they hand out samples, and note whether the physicians are compensated for their time.

According to Dr. Julie Morita, commissioner of Chicago’s Department of Public Health, the city is working on how it would enforce the ordinance and punish violators, though pulling a representative’s license might be one such possibility.

The licenses would cost roughly $750 per representative, annually (compared to the $175 fee in Washington, DC). The estimated $1 million in license fees would support the licensing program as well as help support treatment for addiction. When asked if the ordinance was just another way for the city to make money and add to their revenue rolls, Dr. Morita stated it was about protecting the health and well-being of Chicagoans.

Other Efforts

The city of Chicago has long been known to aggressively challenge marketing practices of the pharmaceutical industry, most notably by filing a lawsuit against several opioid manufacturers. In addition to the additional licensing requirement, Emanuel plans to expand investments to treat heroin and opioid addictions, including $700,000 in new funding that will be focused on opioid treatment deserts where there is a disproportionate level of addiction and the need is greater than the availability of services.

Chicago will also invest $250,000 in naloxone, going to the Chicago Recovery Alliance, to increase access to the overdose antidote in the communities that have been hit the hardest by the opioid epidemic.

Focusing on education and awareness of addiction prevention and treatment, Chicago has secured $350,000 for education campaign (including a $300,000 grant from Pfizer and two $25,000 grants from CVS and Walgreens). The education campaign will include outreach to community and to the healthcare providers who prescribe opioids, helping them to understand the dangers of opioid addiction and apply recent guidelines from the Centers for Disease Control and Prevention to prevent overprescribing.

These efforts follow a July agreement between Pfizer and Chicago, where both parties agreed to a painkiller marketing code, which we highlighted in the October issue of Life Science Compliance Update.

Industry Response

The Chicago Tribune reached out to the Pharmaceutical Research and Manufacturers of America, asking for comment. PhRMA had not yet been able to review the details and substance of Chicago’s proposal, noting instead, “Industry interactions with health care professionals, however, are extensively regulated by the U.S. Food and Drug Administration. Patchwork local and state initiatives are likely to disrupt the existing federal regulation of important scientific information that benefits both providers and patients.”

November 08, 2016

Wyden Releases Report on Dangers of Underfunding Opioid Abuse

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Earlier this year, Congress passed the Comprehensive Addiction and Recovery Act of 2016 (CARA), but did not authorize funds for the policies it created. Shortly after that, the White House requested $920 million that would expand access to treatment in states as part of a larger effort to combat the opioid epidemic – Congress has not acted on that request.

Since passing CARA, Congressional Democrats have expressed concern surrounding the lack of funding to the policies the bill authorized. Senate Democrats, including Sen. Wyden, expressed frustration when only $7 million was provided in the legislation after efforts to produce an amendment that would deliver offsets to cover the full funding request.

On October 12, 2016, Senator Ron Wyden released a report that outlines the consequences of underfunding treatment for opioid addiction. According to Senator Wyden, “Congress’ approach to funding opioid addiction treatment is nothing short of legislative malpractice. There is bipartisan agreement that the opioid epidemic has to be confronted now. Yet, with dozens of Americans dying from an opioid overdose every day, Congress is breaking its promise to families around the country by not providing every resource available. The time for a ‘down payment’ has long passed.”

In his press release announcing the report, Senator Wyden referred to a study published by the Journal of American Medicine that showed nearly eighty percent of Americans suffering from opioid addiction are unable to access the treatment they need, especially in rural areas across the country.

Senator Wyden, who represents constituents in Oregon, stated,

“Sadly, Oregonians are no strangers to the human toll of drug use and addiction devastating families and communities. I’m extremely disheartened that Congress has closed up shop yet again without acting on its core promise to provide essential funding for proven opioid addiction treatment and prevention efforts. Until states receive real investments in these programs, Congress has failed its job. Families in Oregon and across the country deserve far better.”

Sen. Wyden’s report addresses two key challenges: (1) the lack of available treatment facilities and services across the country, and (2) the barriers patients face when treatment facilities or services are actually available. Additionally, the report details case studies in five states struggling with high rates of opioid addiction, including Wyden’s home state of Oregon, California, Ohio, Pennsylvania, and New Hampshire.

The report notes that “states are doing all they can to fight the epidemic, but as it stands now they do not have the money to build that capacity.” It then issues a call to action for Congress – “It is time for Congress to act. Every day Congress does not do so, another 78 people die waiting for someone to answer their call for help.”

According to Senator Wyden, if the requested funding were provided, it would help states like Oregon battle the opioid epidemic, by allowing them to establish additional treatment centers, to provide life-saving anti-overdose medication, and to train medical personnel to increase the number of those being treated.

The report includes appendices, which provide for a detailed breakdown of how much each state would receive under President Obama’s $920 million proposal; a justification of how the $920 million will be used, including eligible activities; and a summary of a Centers for Disease Control and Prevention (CDC) report, “Increases in Drug and Opioid Overdose Deaths – United States, 2000-2014”. At the end of the report is a lengthy list of footnotes, which provide additional reading for interested parties.

Pushing for additional federal money to go towards combating the opioid epidemic has been a top issue for Democrats in political office. When Congress comes back to work, and a new president elected, it is more likely than not this issue will rear its head once again.

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