Last week, a story by Joe Carlson in the Star Tribunehighlighted how far we still have to go to change some of the thorniest problems in health care.
The story described a pair of criminal charges that have been filed against two Minnesota-based medical device executives.
Last April, as Carlson reported, a Boston grand jury charged Lake Elmo-based Acclarent sales executive Patrick Fabian with 18 counts "of conspiracy, wire fraud and distributing adulterated and misbranded medical devices." Acclarent makes a small balloon that can be inflated to keep the nasal passages open during surgery.
According to the charges, the company tried to promote the device as a drug delivery tool, but the Federal Drug Administration never said that use of the balloons was safe or effective. It's illegal to promote a medical product for unapproved uses.
Last November, a San Antonio grand jury charged Vascular Solutions CEO Howard C. Root "with nine counts of conspiracy and distributing adulterated and misbranded devices." Vascular Solutions makes a device that treats varicose veins. The charges allege the company encouraged sales representatives to push the product for the treatment of deep vein segments despite the fact that it was not approved for that use.
Both have pleaded not guilty.
It surely comes as a shock to some in Rochester, a city dedicated to placing itself on the forefront of developing new medical technologies, that doing so without sufficient respect for the regulatory system can place a person at risk of going to jail.
The shock is understandable because we don't put executives in prison in America. The banking crisis is a great example, with trillions of dollars worth of lost capital, billions of dollars worth of fines levied, and yet the jail terms that actually change behavior in boardrooms and CEO offices never handed down.
The same situation has occurred in the pharmaceutical and medical device industries over the last decade. Federal prosecutors have targeted drug and device companies for $8 billion in fines — Pfizer has been penalized under the RICO lawused to denote systemic corruption — but the executives who authorized the actions never were charged.
Levying fines has been ineffective and the reason comes down to simple math. The financial penalties were massive, but the crimes still paid — the products always delivered billions more to the company than the fines took away.
If a drug brings $5 billion in annual sales for 10 years — a typical scenario with a blockbuster pill — and a judge in Virginia fines your company $2 billion for promoting unauthorized uses, that's a write-off, and financially, a smart one.
Former U.S. Attorney General Eric Holder has gone to work for a law firm that helps banking executives avoid jail.His replacement is of a different mindset, apparently, as earlier this month the Deputy U.S. Attorney General Sally Quillian Yates stated that the government will begin charging executives personally.
Not surprisingly, as executives face legal actions risking jail, we are seeing the start of an organized effort to undo the law against off-label marketing.
Using First Amendment arguments to do just that, the drug and device sector will begin arguing that it is their right under the first amendment to tell doctors and others about studies they have produced showing their products do more than the FDA says they do.
We are in trouble on this — the knowledge within the legal system of the malleability of clinical trials is surely limited. A judge recently agreed with this tortured use of the free speech argument, in fact, granting a drug maker the right to use "truthful and non-misleading" speech to market a drug for an off-label use.
Left undecided is who will make the determination that the science promoting a new use of a product is "truthful and non-misleading." We ought to create an agency to find out if a study is truthful and non-misleading. Something like, I don't know, the FDA.
It flies in the face of all that we have learned about the ability for private parties to make medical studies say anything they want them to say.