The News Tribune – September 20, 2011
by Tracy Weber and Charles Ornstein; ProPublica

Despite their power to secure large settlements from drugmakers, the suits have failed to resolve the culpability of physicians

Two years ago, drugmaker Eli Lilly pleaded guilty to illegally marketing its blockbuster antipsychotic Zyprexa for elderly patients. Lilly paid $1.4 billion in criminal penalties and settlements in four civil lawsuits.

But a doctor named as a co-defendant in one suit – for allegedly taking kickbacks to prescribe the drug extensively at nursing homes – never was pursued.

Last year, Alpharma paid $42.5 million to settle federal allegations that it paid kickbacks to doctors to prescribe its painkiller Kadian.

“Health-care decisions must be based solely upon what is best for the individual patient and not on which pharmaceutical company is paying the doctor the biggest kickback,” Rod Rosenstein, U.S. attorney for the District of Maryland, said in a statement announcing the settlement.

But the doctors, accused of trading prescriptions for paid speaking gigs, faced no consequences.

At least 15 drug and medical-device companies have paid $6.5 billion since 2008 to settle accusations of marketing fraud or kickbacks. However, none of the more than 75 doctors named as participants was sanctioned, despite allegations of fraud or of conduct that put patients at risk, a review by ProPublica found.

Reporters reviewed hundreds of pages of court records and interviewed current and former federal prosecutors, state medical board officials, attorneys for whistle-blowers and, when possible, the doctors. For each doctor identified in a suit, ProPublica checked for state medical board discipline, penalties from the Medicare program and federal criminal charges.

In many of the cases, it appears that not even a cursory investigation was done to see whether the physicians had behaved inappropriately.

“Doctors have kind of gone under the radar,” said Tavy Deming, a Philadelphia lawyer who represents drug company whistle-blowers.

Amid concerns about the influence of drug company money on medicine, whistle-blower lawsuits have emerged as a headline-grabbing tool for holding manufacturers accountable.

Yet, despite their power to secure large settlements from drugmakers, the suits have failed to resolve the culpability of physicians. Doctors often are not named as defendants, even though descriptions of their alleged misconduct are used to bolster the suits. And even when settling, many companies, including Alpharma, continue to deny the allegations.

After cases are resolved, the internal company documents used as evidence remain confidential, preventing further exploration of the physicians’ behavior. Patients have no way of knowing whether their doctor’s judgment has been compromised, and doctors might be tarnished by spurious accusations.

Medical boards, which normally pursue tips or complaints of wrongdoing, do not routinely scan for such cases. Justice Department lawyers, wary of spending more time and effort on a case, say they usually are not interested in going after lesser players.

Tony West, the assistant attorney general who oversees civil litigation nationwide for the Justice Department, declined through a spokeswoman to discuss the issue. In announcing settlements with the drug companies, however, West has said that kickbacks undermine doctors’ credibility. Medical decisions, he said in one news release, should be “guided by a patient’s needs, not tainted by illegal incentives or fraud.”

Sen. Charles Grassley, Iowa, the ranking Republican on the Judiciary Committee, said in a written statement that it takes “two sides to perpetuate this fraud” and that both need to be held accountable.

“Otherwise, regardless of how big of a civil settlement a drug company makes, the incentive to cheat the taxpayers will still be in place for those willing to take part,” said Grassley, who has led investigations into conflicts of interest in medicine.

In recent years, pharmaceutical and medical-device companies have been barraged by whistle-blower lawsuits detailing how the pursuit of profit allegedly fueled fraud and corruption.

The suits are typically filed by former employees who say the companies promoted drugs for unapproved uses or paid doctors to prescribe drugs or use medical devices. The suits seek to recover millions – even billions – of dollars spent on these products by government health programs.

For Justice Department lawyers, big drug companies make attractive targets. They are flush with profits and determined to avoid crippling legal defeats. Their bureaucratic sprawl often leaves a trail of incriminating email and memos.

The massive financial settlements they are willing to pay are often modest in light of their annual sales and profits. Zyprexa, for example, had U.S. sales of nearly $3 billion in 2010. Kadian, Alpharma’s painkiller, brought in nearly $263 million, according to IMS Health, which tracks prescription drug sales.