Pharmaceutical Commerce - March/April 2013 - (Page 34)

Legal & Regulatory Criminal investigations for counterfeit, diverted drugs skyrocketed in 2012 Number of cases opened by FDA’s Office of Criminal Investigations (OCI) triples to 170 FDA doesn’t broadcast the level of activity undertaken by its Office of Criminal Investigations (OCI) each year, but the information usually trickles out in industry presentations. For FY2012, the count of such investigations reached 170—a huge increase over the FY2011 count of 59 (figure). Putting that in a longer-term context, the number of cases were in the 10–30 range in the first few years of the last decade, then jumped to the 50–70 range in the late 2000s. A query to FDA about the jump elicited this response: “The increase in OCI counterfeit cases initiated in FY2012 was due, in large part, to cases that were developed from the counterfeit Avastin and Altuzan incidents.” The cases being referred to occurred roughly a year ago, when it was discovered first that Genentech’s Avastin was being illegally imported from the Middle East and sold to individual doctors’ offices, and then that some of it was actually counterfeit (Pharmaceutical Commerce, Sept/Oct 2012, p. 20). Letters were sent to some 19 offices notifying customers that the drug they had purchased was illegal; subsequently, at least one doctor pleaded guilty to FDA violations, and investigations were being pursued with others. Other misappropriated drugs were caught up in the same illegal-importation scheme. OCI is charged with investigating, among other things, drugs that are counterfeit, diverted (from, say, a Medicare-funded, dispensed prescription, back into commercial distribution), stolen (particularly cargo theft, which now gets special attention from FDA) and “economically motivated adulteration,” which covers a variety of situations, notably the contaminated heparin, mixed with an oversulfated chondroitin, that showed up in 2008 in the US, and led to the deaths of dozens of patients. Stolen or diverted pharmaceuticals might seem to be more of an economic than health risk, but the fact is that many drugs require controlled storage, and once they are removed from those controls, can become ineffective at least and potentially harmful. FDA is usually careful to note that the count of OCI cases is not directly proportional to the volume of illicit activity that might be going on; among other factors, it is a measure as well of how actively OCI pursues investigations. A 2011 report from FDA on the counterfeit/diverted drug situation sums up the point: [R]esults presented should not be interpreted as a scientific representation of current drug supply chain trends or a comprehensive review of problems associated with the drug supply chain. Instead, these results should be viewed as an illustrative representation of certain problems and vulnerabilities that we have observed in the drug supply chain. However, even with all those qualifiers, a tripling of OCI cases leaves a nagging sense that there is, in fact, a trend here. The statistics play into the debate of, among other things, the need to impose a track-andtrace system on drug distribution in the US (something that is now proceeding apace in After long delay, Sunshine Act regulations are now final Industry data collection to begin Aug. 1, with a first report to CMS on March 31, 2014 Some 16 months after they were due to appear, the regulations for complying with Section 6002 of the Affordable Care Act, also known as the Physician Payment Sunshine Act, were released on Feb. 1. At first glance, there appear to be few major changes from when the proposed rules were released last year; CMS received, by its count, 373 comments, but after addressing these comments and after the final review by the Office of Management and Budget, nearly all of the proposed rules appear to be in place. As befits a complex, 286-page regulation and accompanying notes, reaction was initially guarded. “The AMA will carefully review the new Physician Payment Sunshine Act rule,” said AMA president Jeremy Lazarus, MD. Senator Charles Grassley (R-IA), who had been hectoring OMB to get the rules out as recently as two weeks before the release, issued a statement saying, “The lack of transparency regarding payments made by the pharmaceutical and medical device community to physicians has created a culture that this law should begin to change substantially. The reform represented by the GrassleyKohl Sunshine Law is in patients’ best interests. I will stay vigilant about how this law is implemented, especially after the delays seen already.” The original goal of the Sunshine Act was to reveal financial relationships between prescribing doctors and pharma and med device companies, presumably so that patients can assess the impartiality of what their doctors recommend. But it remains to be seen whether this will alter patients’ preferences, because the Act covers not just direct payments (such as meals, entertainment or honoraria) but also indirect payments, such as money flowing from a pharma company, through a contract research organization, to a principal investigator. Owner relationships between prescribing physicians and group purchasing organizations will also be quantified. Also up in the air are the Sunshine rules of a handful of states, including some where the value of product samples (which is a roughly $15-billion expenditure by pharma in the US) is collected; the federal Sunshine Act exempts product samples and, moreover, preempts state rules. “In the Final Rule, CMS confirms that products intended for patient use, including any product provided as a sample to a covered recipient that is intended for patient use, will be excluded from the reporting requirement under the Final Rule,” says a PDMA Alliance statement about the CMS action, but notes that “the preamble to the Final Rule also discusses that State and local entities may require reporting of non-required categories of information related to payments or other transfers of value that are not required under the Federal law.” More service offerings Meanwhile, IT vendors and service providers continue to bring out new solutions for agg-spending programs. At the recent CBI Pharmaceutical Compliance Conference (Washington, DC; Jan. 29–30), Health Market Science (King of Prussia, PA) announced an expansion of its CompleteSpend compliance suite with a new module: Expense Manager. CompleteSpend, which has been on the market for a while, enables compliance managers to aggregate expenses and generate reports, either for state/federal compliance or on an 34 Visit our website at www.PharmaceuticalCommerce.com March | April 2013 Europe, China and elsewhere). Defenders of the status quo maintain that the “normal chain of distribution” (from manufacturer to authorized wholesaler to dispensing pharmacy) is well protected. But—if there is smoke, is there also a fire? ad-hoc basis. But much of the aggregation—coming from sales expense reports, clinical research, grant management and elsewhere in a diverse pharma company, needs to be manually entered, explains Greg Maynard, a director at the company. Expense Manager automates a significant part of this activity by matching the data forms (from disparate IT systems) and performing a matching function that completes some or all of the aggregation. It will also highlight “remediation” issues—where a data report is incomplete or ambiguous. Both CompleteSpend and Expense Manager benefit from Health Market Science’s provider database, which the company claims is the most comprehensive master list of US HCPs and their affiliations (Health Market Science runs something called the Provider Data Consortium, which uses retail pharmacy claims and medical claims to validate HCP identities and affiliations.) However, both Expense Manager and CompleteSpend can be used independently of the company’s master list. Another vendor, Aggregate Spend Solutions, LLC (Raleigh, NC) essentially came into being with its product: SpendMD. The company’s principals have experience in meeting and travel management, and have parlayed that into an IT solution that collects the data associated with dinner meetings, conferences or other industry-provider interactions, so that hotel, dining, travel and related expenses can easily be totaled, allocated to HCPs and validated. (One of the more interesting topics discussed at the PCC meeting was the fact that physicians attending a dinner meeting, but who do not want to have meal expenses allocated to them, can opt out of the dining portion of the event. Even so, said one participant, the dinner tables at these events still tend to be full of the attending physicians.) http://www.PharmaceuticalCommerce.com

Table of Contents for the Digital Edition of Pharmaceutical Commerce - March/April 2013

Pharmaceutical Commerce - March/April 2013
Editorial
Contents
Op-Ed
Top News
Business/Finance
Brand Marketing & Communications
Supply Chain/Logistics
Information Technology
Manufacturing & Packaging
Legal & Regulatory
Meetings and Editorial Index

Pharmaceutical Commerce - March/April 2013

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