Healthy Skepticism Library item: 11331

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Publication type: news

Silverman E.
In Minnesota: Docs, Money And Medicaid
Pharmalot 2007 Aug 21
http://www.pharmalot.com/2007/08/in-minnesota-docs-money-and-medicaid-drugs/

Full text:

A groundbreaking Minnesota law is shining a rare light into the big money that drugmakers spend on members of state advisory panels who help select which meds are used in Medicaid programs for the poor and disabled, the Associated Press reports.

The panels, mostly comprised of docs, hold great sway over the $28 billion spent on drugs each year for Medicaid patients nationwide. But aside from Minnesota, only Vermont and Maine require drugmakers to report payments to doctors for lectures, consulting, research and other services. An AP review of records in Minnesota (here they are) found that one doc and one pharmacist on the eight-member state panel simultaneously got big checks from drugmakers for speaking about their products.

John Simon, a Minneapolis psychiatrist, earned $354,700 from such companies as Lilly and AstraZeneca between 2004 to 2006 in speaking and consulting fees. Bob Straka, a University of Minnesota pharmacy professor, earned $78,100 in speaking and other fees from 2000 to 2006, including $36,745 from Schering-Plough and $24,623 from Merck. Both insisted they weren’t influenced by money, but the lack of recorded votes in meeting minutes makes it difficult to track links between payments and policy.

But ethical experts said the data raise questions about the possibility of similar financial ties between the pharmaceutical industry and advisers in other states. “In the absence of disclosure laws, there’s certainly no way to know,” Jack Hoadley, a research professor specializing in Medicaid at Georgetown University in Washington, tells the AP. “There are a lot of physicians in general who have at least some contract or grant funding out of pharmaceutical companies, and (others who) do speaking engagements.”

The AP began looking at the records in mid-June. Soon after, the Minnesota Medicaid Drug Formulary Committee began considering a conflict-of-interest policy that would require members to disclose such financial relationships and recuse themselves from voting in some cases. The committee is expected to act on the policy next month.

State officials said they would examine the panel’s past actions for any bias tied to the payments, and they will start screening appointees to more than two dozen advisory councils for similar links to the drug industry. They will also require the Drug Formulary Committee to begin recording how each member votes at its meetings.

The Minnesota advisory panel’s recommendations to the state Human Services Department are almost always followed. The committee guided $240 million in spending on drugs for 202,000 patients last year. That’s slightly less than a third of all the state’s Medicaid patients – mostly disabled and mentally ill people whose medical bills are paid directly by the state.

The top drugs for Minnesota Medicaid patients covered by the panel’s advice in recent years have been schizophrenia treatments from Lilly and AstraZeneca – Lilly’s Zyprexa from 2000 to 2004, followed by AstraZeneca’s Seroquel in 2005 and 2006. About a third of the drugs on the state’s preferred drug list are made by companies that paid Simon, Straka or both.

A medical ethicist says state advisers shouldn’t take industry money because of the power the panel exercises over poor and vulnerable patients. “This is a high-stakes committee,” says Art Caplan, who heads the Center for BioEthics at the University of Pennsylvania. “If you’re going to have your hand on that tiller, you don’t want to think that anybody is trying to push it.”

Some other states have taken tough measures to guard against that. Nevada bars anyone from serving on its Pharmacy and Therapeutics Committee who is in any way paid by or affiliated with a corporation that makes prescription drugs. “It’s as clean as we can get or we can dream up,” says Charles Duarte, the state’s Medicaid administrator. In Idaho, committee members can be fired on the spot for failing to disclose a conflict of interest.

Here’s what the Minnesota records show:

Simon, a Minneapolis psychiatrist, earned $354,700 from companies including Eli Lilly and AstraZeneca from 2004 to 2006 in honoraria, speaker’s and consulting fees, and other payments ranging from $500 to $93,012. His stint on the formulary committee began in June 2004. Simon says he still speaks about new meds for pay, giving talks an average of every week or two, and the engagements let him share his expertise with primary care doctors and other health care workers who care for mentally ill patients.

He insists his work for drugmakers – primarily Eli Lilly, which has paid him nearly half a million dollars since 1998 – has not posed a conflict of interest because the antipsychotics, antidepressants and dementia drugs he promotes have never been discussed by the panel. But he declined to name the drugs, citing confidentiality agreements. If those drugs came up for discussion, he maintains he would disclose his connections and abstain from voting.

He also argues that he should be able to vote on drugs made by the companies that pay him, as long as they don’t come from the neuroscience or psychiatric divisions that pay him. But Simon won’t oppose a stricter standard. “There’s absolutely no record of my biasing in favor of one company or another or any of them,” he says. “I figure the preferred drug should be the one that cuts the best deal with the state.”

Spokesmen for Eli Lilly and AstraZeneca said their companies’ relationships with Simon had nothing to do with his role on the panel. Lilly spokesman Phil Belt says Simon even voted against Lilly products, including a growth hormone and an insulin. “It just wouldn’t be appropriate to assume or imply that our relationship with him is in any way a product of or influenced by his role on the Drug Formulary Committee,” Belt says.

Straka says he was paid for educational talks usually arranged by medical groups who lined up the sponsors, and that he routinely discloses his ties with drugmakers – and did so as a formulary committee member, both verbally and in writing. “I have no problem with the issue of fully disclosing things. I do that all the time,” he says.

But a public records request by the AP turned up no information about Straka making such disclosures. Nor do such statements appear in the committee’s minutes going back to February 2001. Other committee members and staff interviewed by AP could not recall him disclosing compensation from drug makers.

The information about Straka’s earnings might not have come out at all, because drugmakers aren’t required to disclose payments to pharmacists under the Minnesota law. Many did so anyway in his case, with some listing him as an “M.D.” in their reports.

William Korchik, the panel’s chairman, says he supports disclosure of relationships with drug companies, “whether it’s stock, research or speaker’s fees.” Korchik claims he didn’t know the extent of the financial relationships until contacted by AP. But Korchik defended the panel’s work, saying the ties did not bias a group that works mainly by consensus. “This whole thing may be an issue of appearance of conflict, but I really feel comfortable that the committee has not been hoodwinked,” he says.

Al Heaton, a pharmacist who has served on the committee since the early 1990s, is the only panel member mentioned in the last six years of minutes for disclosing a potential conflict of interest and abstaining from a vote – on bone drugs he had gotten funding to research years earlier. “I think that’s important to know,” says Heaton, the director of pharmacy at Blue Cross and Blue Shield of Minnesota. “An individual may be perfectly honest and totally objective, but finding it out afterward, then you always wonder were they or were they not?”