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The Relationship Between Overall Utilization and Settlements Involving Off-Label Promotion of Prescription Drugs

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The Relationship Between Overall Utilization and Settlements Involving Off-Label Promotion of Prescription Drugs The Relationship Between Overall Utilization And Settlements Involving Off-Label Promotion Of Prescription Drugs A Dissertation SUBMITTED TO THE FACULTY OF UNIVERSITY OF MINNESOTA BY Jennell C. Bilek IN PARTIAL FULFILLMENT OF THE REQUIREMENTS FOR THE DEGREE OF DOCTOR OF PHILOSOPHY Stephen W. Schondelmeyer and Angeline M. Carlson February 2013 © Jennell C. Bilek 2013 Acknowledgements This dissertation would not be complete without recognizing the guidance, encouragement and support I was fortunate enough to receive over the years. First and most importantly, I would like to thank my family for their love, support, encouragement, sacrifice and understanding. My accomplishments are their accomplishments. Thank you for always being my biggest fans. To my advisors, Dr. Angie Carlson and Dr. Steve Schondelmeyer I cannot even begin to express in words how thankful I am for your guidance and mentoring over the years. To Dr. Schondelmeyer: I express heartfelt gratitude for the many opportunities and experiences that you have provided me over the years. My knowledge of the pharmaceutical marketplace is largely a result of your mentoring. From working for you on lawsuits to having a consulting business together to your guidance throughout pharmacy, law and graduate school- thank you. I only hope I can remember all of the things you have taught me. To Dr. Carlson: I cannot thank you enough for showing me how much a woman is capable of accomplishing. It is because of women like you that things are so much easier for working women today. I express heartfelt gratitude for your assistance, your mentoring, and your efforts on my behalf throughout this project. Thank you for always making time for me and always either having an answer or knowing where we could find one. i I would like to thank the SAS master, Dr. Glenn Trygstad, who assisted me with massive excel spreadsheets provided through the various data sources. Dr. Trygstad also provided assistance with variable selection and testing for my statistical analysis and through SAS assisted me with the data outputs for my quantitative analysis. To the rest of the members of my committee, Dr. Weckwerth and Dr. Hadsall, thank you for your time and efforts on my behalf. I would like to thank the College of Pharmacy for providing me access to an education, resources, and Professors unique to the University of Minnesota. I would like to thank William Mitchell College of Law and particularly Neil Axton and Professor David Prince who provided me with most of the legal resources I utilized. I would like to thank Taxpayers Against Fraud for assisting me in identifying case numbers and some of the Complaints utilized for this study. I would like to thank Shelly Nippoldt who created spreadsheets of information on the uses for each drug utilized in this study from yearly volumes of the AHFS. Special recognition must be given to IMS Health Incorporated who graciously provided many of the data sources utilized for this study free of charge. I am grateful to the individuals who took the time to generate the datasets at IMS and particularly to Cindy Halas who was my contact from IMS Health Incorporated. In acknowledging the support of the individuals and entities recognized above, I do not transfer responsibility for the contents of this dissertation to them. The author remains solely responsible for this work. ii Dedication This dissertation is dedicated to my Mom and Dad, John and Susan Bilek. iii TABLE OF CONTENTS List of Tables……………………………………………………………………………vi List of Figures………………………………………………………………………..…..vii Chapter 1…………………………………………………………………………………..1 Background and Significance……………………………………………………..3 Problem Statement………………………………………………………………..4 Purpose of Study………………………………………………………………….5 Research Objectives and Hypotheses…………………………………………….6 Implications of the Study………………………………………………………..12 Chapter 2…………………………………………………………………………………14 The Process……………………………………………………………………..14 Regulators, Programs and Laws………………………………………………..17 The Food and Drug Administration……………………………………..17 Medicare…………………………………………………………………20 Medicaid…………………………………………………………………23 The Food, Drug, and Cosmetic Act……………………………………..25 The Food and Drug Administration Modernization Act…………………26 Post FDAMA: FDA Guidance on Off-label Promotional Materials…….30 Medicare Prescription Drug, Improvement, and Modernization Act……38 Anti-kickback Statute…………………………………………………….38 False Claims Act…………………………………………………………39 Best Price: False Claims Act; Medicaid Rebate Program……………….47 The Government’s Use of Non-Monetary Tools to Combat Healthcare Fraud……………………………………………………………………………..48 Corporate Integrity Agreements…………………………………………48 Ineffective: attached to subsidiary/shell companies…………………….50 Ineffective: as a deterrent………………………………………………..52 Off-Label Promotion Literature…………………………………………………55 Chapter 3…………………………………………………………………………………59 Theoretical Models………………………………………………………………59 Study Methods and Data Sources………………………………………………..61 Methods and Sources for Dependent Variable…………………………..63 Methods and Sources for the Independent Variable……………………..65 Categorization of Each Variable…………………………………………74 Quantitative Analysis……………………………………………………………79 The Chi-Square Test…………………………………………………….81 The Mantel-Haenszel Chi-Square Test………………………………….83 Chapter 4………………………………………………………………………………..85 Individual Case Reviews……………………………………………………….85 Protropin…………………………………………………………………86 Neurontin………………………………………………………………..86 Evista……………………………………………………………………94 Serostim…………………………………………………………………98 Temodar and Intron A…………………………………………………102 iv Actimmune…………………………………………………………….106 Genotropin……………………………………………………………...109 Oxycontin……………………………………………………………..112 Abilify…………………………………………………………………117 Loprox…………………………………………………………………..120 Trisenox………………………………………………………………124 Xyrem…………………………………………………………………129 Cardizem LA……………………………………………………………133 Baycol…………………………………………………………………..134 Actiq, Gabitril and Provigil…………………………………………….137 Zyprexa…………………………………………………………………142 Bextra, Geodon, Zyvox and Lyrica……………………………………..145 Celexa and Lexapro……………………………………………………150 Seroquel……………………………………………………………...…153 Topamax………………………………………………………………..157 TOBI……………………………………………………………………160 Vioxx and Zocor……………………………………………………….162 Quantitative Study Results……………………………………………………164 Descriptive Statistics………………………………………………….165 Chi-Square Tests………………………………………………………171 Mantel-Haenszel Chi-Square Tests……………………………………208 Chapter 5………………………………………………………………………………225 Bibliography……………………………………………………………………………264 v LIST OF TABLES Table A………………………………………………………………………………….240 Table B-1………………………………………………………………………………241 Table B-2………………………………………………………………………………243 Table C…………………………………………………………………………………244 Table D………………………………………………………………………………….245 Table E………………………………………………………………………………….246 Table E-2………………………………………………………………………………249 Table F………………………………………………………………………………….250 Table G………………………………………………………………………………….251 Table H………………………………………………………………………………….252 Table I…………………………………………………………………………………..254 Table J………………………………………………………………………………….256 Table K…………………………………………………………………………………258 Table L…………………………………………………………………………………260 vi LIST OF FIGURES Figure Ia………………………………………………………………………………….75 Figure Ib………………………………………………………………………………….76 Figure IIa………………………………………………………………………………261 Figure IIb………………………………………………………………………………262 Figure IIc………………………………………………………………………………263 vii CHAPTER 1 INTRODUCTION 1.1 Introduction Prescription drug spending has risen over the past two decades. Outpatient spending in the US for prescription drugs was $234.1 billion in 2008, nearly 6 times the $40.3 billion spent in 1990.1 From 1998 to 2008, prescription drugs contributed 13% of the total growth in national health expenditures, compared to 30% for hospital care and 21% for physician and clinical services.2 Given these rising costs, regulators began to turn their attention to fraudulent activity that leads to prescription drug spending by taxpayer funded health care programs. Legislators passed laws and regulations and the Department of Justice began to enforce them in an attempt to curb fraudulent activity that leads to greater dollar amounts spent on prescription drugs. The fraudulent activity that is the focus of this dissertation relates to promotional or marketing tactics employed by pharmaceutical companies to encourage drug sales. In 2000, pharmaceutical companies spent more than $15.7 billion on promoting 3 prescription drugs in the United States. Pharmaceutical companies spent more than $4.8 1 Kaiser Family Foundation, Prescription Drug Trends May 2010. This number reflects current amounts and is not adjusted for inflation. 2 Centers for Medicare & Medicaid Services, National Health Expenditure Accounts, Historical, http://www.cms.gov/NationalHealthExpendData/ accessed October 6, 2009. 3 Rosenthal MB, Berndt ER, Donohue JM, Epstein AM, Frank RG (2003) Demand effects of recent changes in prescription drug promotion. Henry J Kaiser Family Foundation. Available: http:⁄⁄www.kff.org/rxdrugs/6085-index.cfm. Accessed March 23, 2007. 1 billion on detailing, the one-on-one promotion of drugs to doctors by pharmaceutical sales representatives, commonly called drug representatives. The sales force expenditure for pharmaceutical companies was $875 million annually by 2004.4 Although pharmaceutical companies commonly market and promote their prescription drugs, the government frowns upon certain types of marketing and promotion. For example, pharmaceutical companies have paid billion dollar settlement amounts to the government based on allegations that the company promoted
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