Health Law

Bloomberg News (2/20, Goldstein, Marcus) reports, "WellCare Health Plans Inc. became the second managed care provider this year ordered by the government to stop enrolling new customers in Medicare-backed drug and medical plans. The shares fell as much as 30 percent in extended trading." CMS' "sanction takes effect on March 7 and won't be lifted until the company satisfies regulators that operations and marketing have improved, according to the letter." Medicare's Chief of Private Plans Abby Block said, "WellCare's performance was substandard in numerous areas, and WellCare was one of the overall worst performers among all plans. ... WellCare's complaints are three times the national average."

        The Tampa Tribune (2/20, Mullins) reports, "The suspension does not affect any current enrollees in WellCare plans, nor does it involve the company's Medaid programs. But it does suspend WellCare from adding any new members to its Medicare health and drug plans across the country." In response, "WellCare spokesman Amy Knapp said this federal action does not relate to any recent government probes or investigations – such as the high-profile raid on the company's offices in October 2007. Rather, federal regulators Thursday called out WellCare on the quality of its business practices. Last July, the company disclosed that previous executives overbilled government health programs by $49 million."

With the White House and Kansas Gov. Kathleen Sebelius' (D) office offering no additional comments on her possible nomination as HHS Secretary, media coverage by major media outlets declined significantly. Coverage available today primarily echoed material covered in Thursday's news and included mostly positive assessments of her credentials.

        Al Kamen in his In the Loop column in the Washington Post (2/20, A21) writes that Sebelius "seems somewhat hesitant about making the move to D.C." Meanwhile, the White House is also considering former Health Care Financing Administration director Nancy-Ann DeParle "and Jack Lew, who has been confirmed as deputy secretary of state for management. Lew worked on healthcare reform in the Clinton administration. There is a growing view that it may take two people to handle the twin roles Daschle had negotiated."

        In contrast to Kamen's suggestion Sebelius was "hesitant," the Wall Street Journal (2/20, Goldstein) in its Health blog reports, "There have been questions over whether she'd take the job, but someone who spoke with her previously told the WSJ she said she would." CBS News (2/20, Lang) and Bloomberg News (2/20, Goldman, Marcus) reported news available Thursday.

The Wall Street Journal (2/20, B3, Whalen, Dooren) reports that on Feb. 19, the Food and Drug Administration (FDA) "warned that use of the" psoriasis drug Raptiva [efalizumab] "poses the risk of developing a rare and often fatal brain infection known as progressive multifocal leukoencephalopathy" (PML).

        The AP (2/20, Perrone) reports that, according to the FDA, "three patients taking" Raptiva "are believed to have died of" PML, "a known risk with the skin-clearing treatment." On Thursday, the agency "confirmed three cases and a possible fourth of" PML, "which causes swelling of the brain and is usually fatal. All the cases were reported in the last six months." Notably, "the FDA announcement came the same day that" the European Medicines Agency "recommended a ban on marketing the drug," which is "marketed in Europe by Swiss drugmaker Merck Serono."

        "The FDA added a boxed warning, its strictest form of caution, to the prescribing information for Raptiva in October," Bloomberg News (2/20, Olmos, Larkin) added. "The agency said it's reviewing the new information and 'will take appropriate steps to ensure that the risks of Raptiva do not outweigh its benefits.'" Meanwhile, "Genentech is 'working diligently with the FDA to put the right plans in place that will help protect patient safety,' said Tara Cooper, a spokeswoman for Genentech, in an email statement." Genentech "is 'evaluating all possible approaches to address the risk of PML with Raptiva use, including a risk minimization plan.'"

        According to the San Francisco Business Times (2/20, Leuty), "Raptiva was approved in October 2003 to treat chronic moderate to severe plaque psoriasis." At the time the drug was approved, "Raptiva treated 2,764 patients...but only 218 for more than one year." Among those patients, "there were no cases of PML at the time of its approval."

        HealthDay (2/19, Gardner) noted, "In its advisory, the FDA said it...'strongly recommends that healthcare professionals carefully monitor patients on Raptiva, as well as those who have discontinued the drug, for any signs or symptoms of neurologic disease, and that they periodically reassess the benefits of continued treatment.'" The advisory suggested that "patients should be aware of the symptoms of PML and contact their healthcare professionals immediately if they experience any such symptoms." Still, "outside experts" emphasized that, "though the news was serious, there was no reason to panic." Bruce Bebo, Jr., of the National Psoriasis Foundation, urged patients to consult with their physicians and "carefully weigh the risks and benefits of Raptiva." WebMD (2/19, Hitti), the Los Angeles Times (2/19) Booster Shots blog, and the Wall Street Journal (2/19) Health Blog also covered the story.

The Wall Street Journal (2/20, Dooren) reports that on Feb. 19, the Food and Drug Administration (FDA) "approved the first implantable device designed to deliver electrical therapy to the brain to suppress symptoms associated with severe obsessive-compulsive disorder (OCD)." This "device, known as Reclaim DBS (deep brain stimulation) Therapy, is made by Medtronic, Inc.," and "was approved to treat patients with OCD in cases where drug and psychotherapy have failed." It "was approved under the" agency's "humanitarian-device exemptions rules which are" aimed at facilitating "the development of medical devices intended to treat or diagnose a disease or condition affecting fewer than 4,000 people per year in the US."

        The device "is implanted near a person's collar bone or abdomen and is connected by wires to the brain," the AP (2/20) points out. "It works by sending electric pulses." The device "should be available in by the middle of 2009," and is "expected to be used in patients who have remained very ill" with OCD, "despite aggressive use of medications and cognitive behavioral therapy." In the meantime, "Medtronic plans to start studying the device as a potential therapy for treatment-resistant depression."

        In the Chicago Tribune (2/19) Triage blog, Judith Graham observed, "Scientists aren't yet sure how the intervention works" in treating OCD. "In some cases, it may activate brain circuits that are sluggish; in other cases, it may inhibit circuits that are overactive." She pointed out that "with OCD, it's believed that hyperactive circuits contribute to heightened anxiety and, often, depression. People with the disorder indulge in repetitive behaviors, such as washing their hands incessantly or repeatedly making sure a door is shut, as a way of controlling anxiety."

        WebMD (2/19, DeNoon) reported that the FDA based its approval decision "on a clinical study of 26 patients at three US medical centers." Study lead author leader Benjamin D. Greenberg, M.D., Ph.D., called deep brain stimulation "a promising treatment for a subset of patients with OCD who have remained very ill and debilitated despite aggressive use of medications and cognitive behavioral therapy."

        HealthDay (2/19, Roberts), the Minneapolis-St. Paul Business Journal (2/20, Newmarker) and the Dow Jones Newswires (2/20, Dooren) also cover the story.

The New York Times (2/20, A24, Bosman) reports that on Feb.19, Judge Nicholas G. Garaufis, of the Federal District Court in Brooklyn, NY, decided that a lawsuit seeking "to force New York State to overhaul the system under which thousands of mentally ill people are housed in adult homes" will now "proceed to trial." Brought by attorneys from "several nonprofit groups," the suit charges that the state "had violated the Americans with Disabilities Act by failing to provide the mentally ill with the most integrated, least restrictive setting appropriate to their needs," and contends that "many people in the homes could be better served by living in their own homes, at no greater expense to the state." New York State, however, argues that "residents of adult homes are already in an integrated setting, and that the changes suggested by the plaintiffs would constitute a fundamental alteration of the state's services."

USA Today (2/20, Block, Appleby) reports, "A new subsidy that goes into effect March 1 could make health insurance more affordable for millions of laid-off workers. But, some businesses fear it could also raise employer healthcare costs." Notably, the "stimulus package signed into law this week by President Obama subsidizes 65 percent of...COBRA health insurance premiums for individuals laid off between Sept. 1 and the end of this year." New COBRA rules state that "laid-off workers can continue their former employer's health coverage for up to 18 months. In the past, though, they were required to pay the entire premium, plus a 2 percent administrative fee, making COBRA unaffordable for most jobless workers," since "average COBRA premiums exceed $400 a month for individuals, and more than $1,000 a month for families." USA Today points out that "employers, and the companies they hire to manage their COBRA programs, are scrambling to meet the March 1 deadline to notify employees."

        The Washington Business Journal (2/20, Hoover) and the Providence (RI) Journal (2/20, Needham) also covered the story.

Modern Healthcare (2/20, Vesely) reports that "the California Legislature has passed a package of 33 bills to close a $42 billion budget shortfall through June 2010, including a 10 percent cut in public hospital reimbursement rates." Furthermore, "funding for public hospitals to treat the uninsured, known as the Safety Net Care Pool, will drop by about $54 million," but "that funding could be restored...if the state receives specified monies from the federal economic stimulus package."

The Denver Business Journal (2/19, Mook) reported, "A proposed law that would have severely curbed how prescription drugs are marketed to doctors in Colorado was killed late Wednesday amid concerns the measure would have hurt the state's bioscience industry at a time when it's already vulnerable because of the recession."  The bill "prohibited the practice of selling patients' prescription history (or 'data mining') to drug manufacturers for marketing purposes."  In addition, the measure would have "barred doctors from receiving gifts -- ranging from small office items such as branded clocks and cosmetics bags to drug convention junkets."  The Business Journal noted that the proposal "also prohibited people with financial interest in drug manufacturers from making purchasing decisions for research institutions that receive funding."

KCPW Utah (2/19, Ziegler) reported on its website, "A bill moving through the Utah Senate aims to reduce the number of frivolous malpractice lawsuits that originate from" emergency department (ED) visits." Critics, however, are concerned that "the bill only makes it harder for legitimate complaints to be settled." And, according to the AARP's Laura Polacheck, "the bill fails to address the underlying driver of high healthcare costs: doctors ordering unnecessary tests to protect themselves from potential litigation." She added that the bill "does not at all get at the problem of whether or not the care is appropriate, is cost-effective and has the requisite care for an emergency room." Meanwhile, Utah Medical Association President Dr. Cris Cowley called the proposal "an incremental step toward reforming the state's healthcare system." The bill "now moves on to the full Senate for debate."

On its front page, the Boston Globe (2/20, A1, Smith) reports, "Massachusetts General Hospital [MGH] waited four days before alerting Boston health authorities that a wave of gastrointestinal illness was sweeping through patients and staff on one floor."  Dr. David Hooper, chief of the infection control unit at Mass. General "said hospital authorities first became concerned that a virus might be stalking a ward on Saturday, with four patients and perhaps as many as eight staff members already beset with similar symptoms.  Measures were adopted swiftly, he said, to prevent the infection from escaping" the ward.  Officials with the "Boston Public Health Commission [BPHC] learned Wednesday that nine patients and 18 staff had been stricken with vomiting, diarrhea, and nausea."  The exact "cause of the outbreak has not been determined, but disease specialists at the hospital and state said the likely culprit is norovirus."  BPHC has started "an investigation that remains in its early stages," according to Dr. Anita Barry, the city's director of communicable disease control.

The AP (2/20, Johnson) reports that the American College of Emergency Physicians "blasted the University of Chicago Medical Center on Thursday in the wake of a recent" Chicago Tribune "story about a boy attacked by a pit bull who was sent away with only a shot and painkillers." ACEP President Dr. Nick Jouriles "criticized the hospital's Urban Health Initiative, which diverts patients to clinics and hospitals on the South Side." Dr. Jouriles "said the hospital is trying to 'cherry pick' wealthy patients over poor."

        The Chicago Tribune (2/20, Japsen) reports that ACEP is also "concerned other medical centers across the country could adopt similar strategies to cope with long waits for emergency treatment and rising health costs amid the deepening recession, which is what U. of C. said were the primary drivers of its initiative." Meanwhile, ACEP "expressed 'grave' concerns that U. of C.'s policy is 'dangerously close to patient dumping.'" ACEP "also raised the broader issue of whether the...hospital has an obligation to treat all who seek care there because it is a non-profit organization and enjoys tax-exempt status." U. of C., however, "said that as a specialized teaching facility, its costs are much higher than other hospitals', and that it makes more sense to refer patients elsewhere when possible." Crain's Chicago Business (2/19, Colias) also covered the story.

USA Today (2/20, Appleby) reports, "At a time when more people are forced to buy their own health insurance because of job losses, costs for many individual policies are soaring." Specifically, "Anthem Blue Cross in California has notified about 80 percent of its 800,000 individual policyholders of double-digit increases, many above 30 percent." Likewise, insurer "Blue Cross of Michigan is seeking state approval for a 56 percent increase in individual premiums," and "Regence Blue Cross Blue Shield of Oregon will raise rates for approximately 10,000 Washington state customers by 27.1 percent on March 1." Sally Rosen, managing senior financial analyst at A.M. Best, contends that problems like "shrinking enrollment in group plans because employers are shedding jobs" and higher costs due to patients using "more health services" could be causing "higher rate increases than in the past."

FOX News (2/19, Abrams) reported on its website, "Doctors across the country are forcing their patients to sign waivers giving up their right to post comments and reviews about them online, a move experts say is unethical and should be prohibited." Under these waivers, patients are required to "censor themselves -- or find another physician." One company that is "spearheading the move," Medical Justice, argues that "it is helping protect doctors from online libel." Dr. Jeffrey Segal, a former neurosurgeon and founder of Medical Justice, explained that "while the ratings sites may have good intentions, little of the information they impart is of use." In fact, according to one expert, patients "cannot judge the most important issues concerning medical care" on these sites. Meanwhile, Laurence McCullough, professor of medical ethics at Baylor College of Medicine, noted that "this is self-interested behavior," and that "when a doctor acts primarily out of self-interest, it's ethically suspect." Still, "legal experts say private practices are permitted to ask this of their patients."

Life Sciences Law

Bloomberg News (2/20) reports, "Schering Corp. and Takeda Pharmaceutical Co.'s Millennium unit accused Israel's Teva Pharmaceutical Industries Ltd. of infringing their US patent for Integrilin [eptifibatide] anti-clotting agent, made from rattlesnake venom." The patent "is for a drug used to prevent clots when doctors perform artery-clearing angioplasty procedures on heart-attack patients and install coronary stents to prop open clogged blood vessels." The companies "asked a federal judge to prohibit Teva from selling a generic version of Integrilin until the 1998 patent expires in 2015, according to a complaint filed [Wednesday] in Wilmington, Delaware."

On the front page of its Business section, the New York Times (2/20, B1, Meier) reports that after the Supreme Court ruling preventing lawsuits against manufacturers of complex medical devices last February "judges nationwide...have cited it to dismiss cases against a wide range of manufacturers." In response, some lawmakers including House Energy and Commerce Committee chairman Henry Waxman and the head of its health subcommittee Frank Pallone "want to give potential plaintiffs...a chance for legal recourse." They "plan to reintroduce soon legislation that would effectively nullify the Supreme Court decision." Similar legislation is expected to be introduced this spring. Lawmakers and patient advocates say the Supreme Court's ruling "has left patients legally powerless against what they criticize as spotty oversight of products by the FDA." And, "Pallone says he also expects the House Energy and Commerce Committee to hold hearings this session to question whether the FDA. process for approving devices is adequate. 'The FDA has limited resources and can't access all the risks that a device poses once it gets on the market,' he said."

The New York Times (2/20, Meier) reports that a "Justice Department inquiry into Stryker's marketing of human bone growth products has resulted in guilty pleas by" two "former company sales representatives." The investigation of OP-1 and OP-1 putty "involves several issues" including "whether Stryker abused a federal exemption that authorized it to sell only limited quantities of its bone growth products for 'humanitarian' reasons," according to SEC documents. The FDA has not formally approved either "for widespread medical use," but did grant a "humanitarian device exemption" for the product.

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