Former Medtronic senior legal counsel Ami P. Kelley filed a lawsuit claiming the company offered kickbacks to physicians who used its spinal devices, according to a Wall Street Journal article.
Kelley filed suit in 2002, but the contents of the complaint remain under seal except for a redacted copy. The WSJ obtained a copy of the full complaint last week. According to the WSJ, Kelley claims kickbacks were “pervasive” and included a five-day, all-expenses-paid trip to Alaska. Physicians were supposed to present case studies at the Alaska “think tank” but Kelley alleges little discussion about the cases occurred.
In 2006, Medtronic agreed to a $40 million settlement to resolve Kelley’s allegations and similar ones made in a separate case. However, the second whistleblower is appealing the dismissal of her lawsuit, saying the settlement is too low. There is no clear indication of what would happen to Kelley’s suit if the other lawsuit is reinstated.
Senator Charles Grassley (R-IA) is also investigating whether Medtronic offered incentives for physicians to use its products off label. In addition, Medtronic is facing a federal lawsuit filed by two former company employees, who allege more than 110 U.S. doctors received more than $8 million during 2006 in exchange for using and promoting Medtronic products.
Medicare reimbursed more than $1 billion for 18 different durable medical equipment (DME) items from January 2001 to December 2006 because of incorrect or missing diagnosis codes, according to a new report from the Senate Permanent Subcommittee on Investigations.
CMS has required diagnosis codes on most DME claims since 2003, but claims review contractors did not effectively use the codes to determine whether the claim should be paid, according to the report. The subcommittee reviewed millions of claims to identify questionable or improper payments, and found numerous instances where the diagnosis code was incorrect, omitted, or not relevant for the DME supplied.
For instance, the subcommittee uncovered thousands of claims where blood glucose test strips were ordered for diagnoses unrelated to diabetes, including bubonic plague, leprosy, and typhoid.
The subcommittee also reviewed $4.8 billion in Medicare claims from 1995–2006 for 60 million DME items that contained invalid, blank, or unprocessable diagnosis codes. Although not all of those claims necessarily resulted in improper payment, the report said Medicare needed to implement additional procedures to ensure accurate, compliant payments.
- Strengthen the claims review process
- Consider developing procedures to link diagnosis codes with medical procedures
- Consider developing procedures to link claims for DME items with corresponding claims for medical treatment
- Strengthen contractor oversight
Fall Prevention Technologies failed to follow current Good Manufacturing Practices for its Balanceback iNVG devices, according to an FDA warning letter.
- Establish adequate quality system procedures for corrective and preventive action complaints, design controls, and records
- Establish and maintain procedures for implementing corrective and preventive action
- Implement procedures for receiving, reviewing, and evaluating complaints
- Ensure service reports include applicable test and/or inspection data following the completion of service
- Review associated data and documentation for all finished devices before they are released for distribution
- Establish a device master record
- Implement procedures to control the design of a device in order to ensure that specified design requirements are met
- Store records in a manner to minimize deterioration and loss
Fall Prevention issued two letters in response to the FDA investigator’s observations and said it planned to gradually implement corrective actions over the next five months. The FDA said it could not assess the adequacy of some of the corrective actions because Fall Prevention needed to update the procedures and retrain employees.
Medical device manufacturers should use a randomized, controlled trial to collect data to demonstrate the safety and effectiveness of urinary incontinence devices, according to FDA draft guidance.
Clinical studies may not be needed for most class I and II urinary incontinence devices, but FDA recommends manufacturers collect clinical data for class I and II urinary incontinence devices with any one of the following:
- Indications for use dissimilar from a legally marketed device of the same type
- Designs dissimilar from designs previously cleared under a premarket notification
- New technology
Manufacturers need clinical data with valid scientific evidence for class III devices. The guidance includes a list of devices and their classifications. The FDA also details how manufacturers should design and conduct studies.
Boehringer Ingelheim Roxane, Inc. (Roxane), a Columbus, OH based drug manufacturer, will pay Massachusetts $1.8 million for allegedly overpricing its drugs, according to a press release from the Massachusetts Attorney General’s Office.
Roxane allegedly inflated the prices it reported for its drugs, including lithium carbonate, azathioprine, Roxicet, Roxicodone, and ipratropium bromide. Medicaid based reimbursement on prices reported to national pharmaceutical price reporting services. The Commonwealth claimed the inflated prices led to overpayment by Medicaid.
Massachusetts sued 13 generic drug manufacturers for allegedly falsely inflating the prices they reported. Dey Pharmaceuticals, Barr Laboratories, Duramed Pharmaceuticals, and Ethex all previously settled with the Commonwealth.
Two of generic drug manufacturer Ranbaxy’s plants allegedly violated U.S. current Good Manufacturing Practices (cGMP), prompting the FDA to issue two warning letters and an import advisory, according to an agency release.
One warning letter addressed problems at Ranbaxy’s Dewas, India, facility found during an FDA inspection in early 2008. During that inspection, FDA investigators documented cGMP deviations in manufacturing of sterile and non-sterile finished products and violations related to the manufacture and control of active pharmaceutical ingredients. The FDA’s concerns included aspects of the firm’s quality control program.
The second warning letter addressed the Paonta Sahib, India, facility following an inspection at its Batamandi unit, also in early 2008. The inspection documented various cGMP deficiencies, including:
- The lack of assurance responsible individuals were present to determine the firm was taking necessary steps under cGMP
- Inaccurate written records of the cleaning and use of major equipment
- Incomplete batch production and control records
- Inadequate procedures for the review and approval of production and control records for drug products
The import alert covers various dosage forms and amounts for more than 30 different generic drugs. Under an Import Alert, U.S. officials may detain active pharmaceutical ingredients and sterile and non-sterile finished drug products manufactured at these Ranbaxy facilities.
In a statement, Ranbaxy said it addressed each concern the FDA raised over the past two years. The company said it was disappointed with the FDA’s actions, but planned to continue working with the agency to resolve the alleged problems.
Indian commerce and industry minister Kamal Nath and chemicals minister Ram Vilas Paswan sent letters to U.S. Secretary of Health and Human Development Michael Leavitt supporting Ranbaxy and asking for an early resolution of the case, according to an article in the India Economic Times. The Indian government would reportedly step in and contact the U.S. government if the ban on Ranbaxy drugs wasn’t lifted after the company took corrective action.
A bill recently signed into law in Massachusetts could stifle clinical research in the state and restrict market access, Eli Lilly’s President and CEO John C. Lechleiter warned in a speech at the Associated Industries of Massachusetts Executive Forum.
Lechleiter said to develop new therapies, pharmaceutical and biotech companies need intellectual property protection, pricing freedom, and market access. He said innovation only becomes meaningful when physicians can learn about it and use it to benefit patients. Because physicians prefer to learn from other physicians, Lechleiter said companies such as Lilly must be able to compensate doctors for their time when they speak to scientific and educational conferences about new discoveries and products. The new Massachusetts law could affect how physicians are paid for legitimate speaking activities.
Researchers are conducing more than 5,600 clinical trials in Massachusetts, but Leihleiter said complex financial disclosure requirements about funding for clinical trial research almost certainly means fewer trials will take place in the state in the future. Life science investment will be scared away from Massachusetts, Leihleiter said. “That’s not good for innovation, for our industry, or for the state’s economy,” he said.
Risk Evaluation and Mitigation Strategies (REMS) could represent the biggest change to drug regulation in decades. And it raises difficult compliance challenges for the pharmaceutical industry, says Meredith Manning, JD, a partner at Hogan and Hartson, in Washington D.C. during the Regulatory Affairs Professionals Society annual seminar September 14-17 in Boston.
REMS allow the FDA to mandate restricted distribution of pharmaceutical products. The FDA may require post-marketing studies for some products under REMS or may require the pharmaceutical company to change the label.
The FDA can require a company to put REMS in place if the agency determines REMS is needed to ensure the benefits of the product outweigh its risks. REMS can require a product only be used in certain settings, by healthcare providers with particular training, or administered to patients who are monitored or enrolled in a registry. The FDA can require the use of certain risk minimization tools, can monitor their effectiveness, and can oversee the way those tools are used.
The FDA looks to see if a drug or biologic is used in a certain way and pharmaceutical companies are now responsible for ensuring third parties administer and use certain drugs properly. Manning advises companies to put systems in place to ensure compliance with REMS.
Clinical or medical personnel should be on hand at trade shows to provide information about unapproved uses of approved devices or investigational devices, according to William Kitchens, JD, a partner at Arnall, Golden, Gregory LLP.
Kitchens, who spoke during the Regulatory Affairs Professional Society’s annual conference in Boston, held September 14-17, says companies should separate information about approved devices and those devices or uses still awaiting FDA approval. They should also be the ones answering any unsolicited questions about those uses.
Manufacturers need to be especially careful about written distribution and oral communication of information at trade shows because exhibits are subject to FDA advertising and promotional regulations. Kitchens says companies can display information about devices or uses pending approval, but must state the device or the use is not FDA-approved.
FDA restrictions on off-label information are not intended to restrict scientific exchange, Kitchens says, but manufacturers must be careful not to editorialize, exaggerate, or commercialize information about investigational devices or unapproved uses. He recommends clinical or medical personnel, not salespeople, handle all unsolicited requests for off-label information.
Medical device manufacturers should establish procedures to review all promotional material prior to distribution, regardless of the content or type of promotion, Kitchens says. The easiest way to stay out of trouble, Kitchens says, is to stick to the FDA approved label. He also recommends training employees so “everyone is on the same page.”
“You don’t want renegade salespeople out there getting the company into trouble,” Kitchens says.