The company, which is responsible for the largest drug price increase in US history, has bribed doctors and employees to increase sales, according to documents recently unsealed in federal court.
Mallinckrodt has used bribes to increase prescriptions for a drug whose price has risen by more than 97,000% since 2000; from $40 to nearly $39,000 per ampoule (source 1-3).
Acthar Gel (Corticotropin Depot Injection) was approved in 1952 for the treatment of spasticity in infants and is now used for a wide range of conditions including nephrotic syndrome, psoriatic arthritis, rheumatoid arthritis (RA), sarcoidosis, optic neuritis, ankylosing spondylitis and, particularly lucrative, multiple sclerosis (MS). Thanks to the price increase and the aggressive push of off-label use, especially in RA and MS, it is now a blockbuster drug with annual sales of over $1 billion, the majority of which comes from Medicare.
The allegations come from two former employees of the company Questcor Pharmaceuticals, which was acquired by Mallinckrodt in 2014 for $5.6 billion. After the U.S. government decided to intervene, the original 2012 Pennsylvania state court case was unsealed in March - a sign that the statements were found credible.
Acthar Gel already cost up to 150,000 dollars per patient in 2012 - significantly more than a generic steroid alternative, which was only 800 dollars. Acthar's main competitor, Solu-Medrol, is cheaper, requires a shorter treatment period and is the treatment standard for MS exacerbations in the US. The prosecution alleges that the company took bribes worth up to $500, including free trips to Las Vegas, opulent dinners at the Ritz Hotel in New York, spa treatments, paid happy hours and Starbucks vouchers. A sales representative had bragged about the success of karaoke trips with Asian physicians in front of one of the whistleblowers.
Other methods included research funding and speaker fees of $2,000 per lecture or more for physicians promoting the drug. A physician at the University of Texas is said to have received $500 per patient for each study he conducted with Acthar Gel, plus additional compensation for presenting the results to physicians nationwide. The indictment states: "These studies are of doubtful scientific value because they were neither placebo-controlled nor double-blind. None of them were published in peer-reviewed journals and none of them led to a Food and Drug Administration (FDA) extension application and none of them showed that Acthar Gel is more effective than Solu-Medrol”.
Mallinckrodt contradicted the content of the accusations and expressed disappointment at the decision to pursue the charges further. According to the company, they are cooperating with the US Ministry of Justice and participating in "advanced negotiations for a solution".
In the complaint, the whistleblowers testify that the Company cheated the government by millions of dollars that should not have been paid, enriched itself and exposed patients to unauthorized, unsafe and potentially ineffective use of Acthar Gel. "Questcor attempted to cover up the bribes and illegal promotions by making false statements to the FDA and instructing employees to conceal evidence. [...] The illegal practices Questcor has been engaged in since 2007 have knowingly continued since the merger and acquisition," it says.
Sources:
1 CNN, W. D. Whistleblowers: Drug company bribed doctors to boost sales. CNN Available at: https://www.cnn.com/2019/04/30/health/mallinckrodt-whistleblower-lawsuit-acthar/index.html. (Accessed: 10th May 2019).
2. Dyer, O. Firm bribed doctors to prescribe overpriced drug, US alleges in suit. BMJ 365, l2043 (2019).
3. Insider, E. C., Business. A drugmaker is accused of using free Las Vegas trips, fancy dinners, spa treatments, and Starbucks gift cards to bribe doctors to sell more of its expensive drug. Business Insider Germany Available at: https://www.businessinsider.de/bribes-allegedly-helped-mallinckrodt-sell-acthar-lawsuit-2019-4.. (Accessed: 10th May 2019).