The New Yourk Times
May 9, 2007
By ALEX BERENSON and ANDREW POLLACK
Two of the world’s largest drug companies are paying hundreds of millions of dollars to doctors every year in return for giving their patients anemia medicines, which regulators now say may be unsafe at commonly used doses.
The payments are legal, but very few people outside of the doctors who receive them are aware of their size. Critics, including prominent cancer and kidney doctors, say the payments give physicians an incentive to prescribe the medicines at levels that might increase patients’ risks of heart attacks or strokes.
Industry analysts estimate that such payments — to cancer doctors and the other big users of the drugs, kidney dialysis centers — total hundreds of millions of dollars a year and are an important source of profit for doctors and the centers. The payments have risen over the last several years, as the makers of the drugs, Amgen and Johnson & Johnson, compete for market share and try to expand the overall business.
Neither Amgen nor Johnson & Johnson has disclosed the total amount of the payments. But documents given to The New York Times show that at just one practice in the Pacific Northwest, a group of six cancer doctors received $2.7 million from Amgen for prescribing $9 million worth of its drugs last year.
Yesterday, the Food and Drug Administration added to concerns about the drugs, releasing a report that suggested that their use might need to be curtailed in cancer patients. The report, prepared by F.D.A. staff scientists, said no evidence indicated that the medicines either improved quality of life in patients or extended their survival, while several studies suggested that the drugs can shorten patients’ lives when used at high doses. Yesterday’s report followed the F.D.A.’s decision in March to strengthen warnings on the drugs’ labels.
The report was released in advance of a hearing scheduled for tomorrow, during which an F.D.A. advisory panel will consider whether the drugs are overused.
The medicines — Aranesp and Epogen, from Amgen; and Procrit, from Johnson & Johnson — are among the world’s top-selling drugs, with combined sales of $10 billion last year. In this country, they represent the single biggest drug expense for Medicare and are given to about a million patients each year to treat anemia caused by kidney disease or cancer chemotherapy.
Dr. Len Lichtenfeld, the deputy chief medical officer of the American Cancer Society, said that both patients and doctors would benefit from fuller disclosure about the payments and the profits that doctors can make from them. “I suspect that Medicare is going to take a very careful look at what is going on here,” he said.
Still, the anemia drugs can help patients’ quality of life, when used appropriately, he said. “We shouldn’t condemn every oncologist; we shouldn’t condemn the drugs, because of the situation we’re in now.”
Federal laws bar drug companies from paying doctors to prescribe medicines that are given in pill form and purchased by patients from pharmacies. But companies can rebate part of the price that doctors pay for drugs, like the anemia medicines, which they dispense in their offices as part of treatment. The anemia drugs are injected or given intravenously in physicians’ offices or dialysis centers. Doctors receive the rebates after they buy the drugs from the companies. But they also receive reimbursement from Medicare or private insurers for the drugs, often at a markup over the doctors’ purchase price.
Medicare has changed its payment structure since 2003 to reduce the markup, but private insurers still often pay more. Combined with those insurance reimbursements, the rebates enable many doctors to profit substantially on the medicines they buy and then give to patients.
The rebates are related to the amount of drugs that doctors buy, and physicians that agree to use one company’s drugs exclusively typically receive higher rebates.
Johnson & Johnson said yesterday in a statement that its rebates were not intended to induce doctors to use more medicine. Instead, the rebates “reflect intense competition” in the market for the drugs, the company said.
Amgen said that rebates were a normal commercial practice and that it had always properly promoted its drugs.
“Amgen is dedicated to patient safety,” said David Polk, a spokesman. “We believe our contracts support appropriate anemia management and our product promotion is always strictly within the label.”
Both companies’ stocks fell yesterday after release of the F.D.A. report. Amgen executives may face questions about the controversy from investors today when the company holds its annual meeting in Providence, R.I.
Unlike most drugs, the anemia medicines do not come in fixed doses. Therefore, doctors have great flexibility to increase dosing — and profits. Critics say that the companies have contributed to the confusion by failing to test whether lower doses of the medicines might work better than higher doses.
“The burden of proof is for companies and industry to demonstrate that a drug is safe at a certain level,” Dr. Ajay Singh, an associate professor at Harvard Medical School. Dr. Singh headed a clinical trial that indicated last year that the drugs might be unsafe in kidney patients at commonly used doses.
Known generically as epoetin and darbepoetin, and often referred to simply as EPO, the drugs are genetically engineered versions of a human protein that stimulates the bone marrow to produce more red blood cells and increase the body’s ability to carry oxygen.
Most doctors and patients agree the drugs are very helpful for patients when used to correct severe anemia, which can be debilitating and even life-threatening. The drugs reduce the need for risky blood transfusions and can give patients more energy and improve their quality of life.
“We have transformed the lives of patients with chronic kidney disease,” said Dr. Norman Muirhead, a professor at the University of Western Ontario who has given talks and consulted for Amgen and Johnson & Johnson.
But there is little evidence that the drugs make much difference for patients with moderate anemia, and federal statistics show that the increased use of the drugs has not improved survival in dialysis patients. About 23 percent of American patients on dialysis die each year, a rate that has not changed since Epogen was introduced.
Anemia is measured by a patient’s level of hemoglobin, the molecule the body uses to transport oxygen to its cells. Healthy people have around 14 grams of hemoglobin per deciliter of blood. Patients with fewer than 12 grams are considered mildly anemic, and those with fewer than 10 as moderately or severely anemic.
The labels on the drugs, as currently approved by the F.D.A., encourage doctors to aim for a hemoglobin level of 10 to 12. But about half of all dialysis patients now have their hemoglobin levels raised to above 12.
Critics of the drugs say their increased use has been driven by profit. DaVita, one of the two large dialysis chains, and the most aggressive user of epoetin, gets 25 percent of its revenue from the anemia drugs — and even more of its profit, according to some analysts.
That trial should have discouraged doctors from using too much epoetin and encouraged Amgen to study the risks further, said Dr. Steven Fishbane, a nephrologist at Winthrop-University Hospital on Long Island.
Instead, use of epoetin continued to soar. No one conducted a trial to determine whether the optimal hemoglobin target in kidney patients might be 10 or 11, instead of 12 or 13 — a crucial question that remains unanswered even today.
The conflicting studies are among the issues the F.D.A. advisory committee is expected to discuss tomorrow. Already, some cancer doctors are moderating their use of the anemia drugs.
Dr. Peter Eisenberg, an oncologist in Marin County, Calif., said many doctors had been induced to use more epoetin by the financial incentives and the belief that the drug was helpful.
“The deal was so good,” he said. “The indication was so clear and the downside was so small that docs just worked it into their practice easily.
“Now it’s much scarier than that,” he said. “We could really be doing harm.”