Medi-Cal pharmacy officials failed for years to report trips funded by Big Pharma and filtered through nonprofit groups. The three officials potentially face $5,000 fines for the omissions. And they clearly face questions about whether they had a conflict of interest while negotiating for drug rebates with the corporations that bankrolled their last (and perhaps next) flight out of Sacramento.
California Watch reported as much yesterday, in partnership with the San Francisco Chronicle and KQED, San Francisco’s NPR affiliate.
The California officials, though, are not the only ones taking the free trips. Officials from at least 20 other states were at a recent corporate-funded conference in Wisconsin. Also, Medicaid officials from New York, Massachusetts, Alaska and many more hold leadership roles with the nonprofit Medicaid Pharmacy Administrators Association groups that collect corporate registration fees and, in turn, pay for state officials' travel.
But close ties between those who sell medications and those who buy those drugs on the public's behalf have proven volatile.
One Pennsylvania pharmacy director was prosecuted criminally for using his state position for personal gain with drug companies. Steven Fiorello accepted $12,000 from pharmaceutical companies, even as he was helping his Medicaid department decide which medications to purchase, according to the Pennsylvania attorney general’s press office.
Fiorello also failed to disclose the payments on statements of economic interest, according to records and published reports. He was fined $27,000 by a state ethics commission and in late 2008 was convicted of two felony counts of conflict of interest and a misdemeanor for failing to report the payments.
In Texas, an ongoing lawsuit alleges that a pharmaceutical company influenced the state Medicaid office. But instead of prosecuting officials, that state’s attorney general is going after the corporations hoping to recover some public money.
The Texas top cop is backing a whistle blower lawsuit that alleges that a Johnson & Johnson unit, Janssen, conspired to exert influence on state Medicaid officials to boost sales of expensive antipsychotic medications.
The lawsuit clalms that the drug companies “provided inducements to Texas state mental health decision maker(s)” that resulted in them making decisions that advanced the corporations’ “financial interest ahead of the state’s interests.”
Bloomberg reported on the case in 2006, which revolves around an “algorithm” that pharmaceutical companies promoted among state Medicaid leaders and doctors:
The guidelines and deceptive marketing techniques boosted sales of Risperdal, raising costs for Texas and endangering patients, according to the complaint, which was secret until it was unsealed Dec. 15. The state is seeking unspecified damages. Risperdal sales were $10 billion in the U.S. from 2001 through 2005, according to IMS Health Inc.
"This is a case about sales and marketing trumping medical science,'' said Thomas Melsheimer, an attorney for the original plaintiff, in a Dec. 19 phone interview. "The basic allegation is that Janssen promoted Risperdal use not for sound medical reasons but for economic reasons.''
The program gave Janssen a “significant increase” in drug sales in Texas, and the company reached out to other states to spread the program, the lawsuit said.
State officials "traveled extensively, at the expense of defendants, to tout the wonders of the new drugs,'' the complaint says. Janssen "improperly influenced state decision-makers with trips, perks, travel expenses, honoraria,'' and paid state officials ``to speak in their official capacities'' to promote the drugs, the complaint says.
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