Axel Koester for The New York Times
Bernice Wilson, 90, receiving dialysis treatment at Crescent Heights Dialysis Center, operated in Los Angeles by DaVita, a large dialysis chain. Her treatment includes a dose of Epogen, a drug used to treat anemia.
By ALEX BERENSON and ANDREW POLLACK
NYT May 9, 2007
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.
Do you trust your doctor to prescribe the appropriate drugs for you?
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.
Since 1991, when the first of the drugs was still relatively new, the average dose given to dialysis patients in this country has nearly tripled. About 50 percent of dialysis patients now receive enough of the drugs to raise their red blood cell counts above the level considered risky by the F.D.A.
American patients receive far more of the anemia drugs than patients elsewhere, with dialysis patients in this country getting doses more than twice as high as their counterparts in Europe. Cancer care shows a similar pattern. American cancer patients are about three times as likely as those in Europe to get the drugs, and they receive somewhat higher doses.