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 (AP)  A groundbreaking Minnesota law is shining
a rare light into the big money that drug companies spend on
members of state advisory panels who help select which drugs are
used in Medicaid programs for the poor and disabled.
      

Those panels, most comprised of physicians, hold great sway over
the $28 billion spent on drugs each year for Medicaid patients
nationwide. But aside from Minnesota, only Vermont and Maine
require drug companies to report payments to doctors for lectures,
consulting, research and other services.

      An Associated Press review of records in Minnesota found that a
doctor and a pharmacist on the eight-member state panel
simultaneously got big checks - more than $350,000 to one - from
pharmaceutical companies for speaking about their products.


      The two members said the money did not influence their work on
the panel, and the lack of recorded votes in meeting minutes makes
it difficult to track any link between the payments and policy.

      But ethical experts said the Minnesota data raise questions
about the possibility of similar financial ties between the
pharmaceutical industry and advisers in other states.

      "In the absence of disclosure laws, there's certainly no way to
know," said Jack Hoadley, a research professor specializing in
Medicaid at Georgetown University in Washington. "There are a lot
of physicians in general who have at least some contract or grant
funding out of pharmaceutical companies, and additional (who) do
speaking engagements."

      The AP began looking at the records in mid-June. Soon after, the
Minnesota Medicaid Drug Formulary Committee began considering a
conflict-of-interest policy that would require members to disclose
such financial relationships and recuse themselves from voting in
some cases. The committee is expected to act on the policy next
month.

      John E. Simon, a psychiatrist appointed to the panel in 2004,
earned more than $350,000 from drug companies between 2004 and
2006. Pharmacist Robert Straka served from 2000 to 2006 and
collected $78,000 from various drug makers during that time.

      Both men, and the committee chairman, said the payments did not
influence their work with the committee.

      But state officials said they would examine the panel's past
actions for any bias tied to the payments, and they will start
screening appointees to more than two dozen advisory councils for
similar links to the drug industry.

      They will also require the Drug Formulary Committee to begin
recording how each member votes at its meetings.
      ---

      The Minnesota advisory panel's recommendations to the state
Human Services Department are almost always followed. The committee
guided $240 million in spending on drugs for 202,000 patients last
year. That's slightly less than a third of all the state's Medicaid
patients - mostly disabled and mentally ill people whose medical
bills are paid directly by the state.

      The top drugs for Minnesota Medicaid patients covered by the
panel's advice in recent years have been schizophrenia treatments
from Eli Lilly & Co. and AstraZeneca PLC - Lilly's Zyprexa from
2000 to 2004, followed by AstraZeneca's Seroquel in 2005 and 2006.
About a third of the drugs on the state's preferred drug list are
made by companies that paid Simon, Straka or both.

      A medical ethicist said state drug advisers should not take
pharmaceutical companies' money because of the power the panel
exercises over the poorest, most vulnerable patients.

      "This is a high-stakes committee," said Dr. Arthur Caplan,
chairman of medical ethics at the University of Pennsylvania School
of Medicine. "If you're going to have your hand on that tiller,
you don't want to think that anybody is trying to push it."

      Some other states have taken tough measures to guard against
that. Nevada bars anyone from serving on its Pharmacy and
Therapeutics Committee who is in any way paid by or affiliated with
a corporation that makes prescription drugs.

      "It's as clean as we can get or we can dream up," said Charles
Duarte, the state's Medicaid administrator.
      In Idaho, committee members can be fired on the spot for failing
to disclose a conflict of interest.


      Here's what the Minnesota records show:

      Simon, a Minneapolis psychiatrist, earned $354,700 from
companies including Eli Lilly and AstraZeneca from 2004 to 2006 in
honoraria, speaker's and consulting fees, and other payments
ranging from $500 to $93,012. His stint on the formulary committee
began in June 2004.

      Simon said he continues to speak about new medicines for pay,
giving talks an average of every week or two. He said the
engagements let him share his expertise with primary care doctors
and other health care workers who care for mentally ill patients.

      Simon said his work for drug companies - primarily Eli Lilly,
which has paid him nearly half a million dollars since 1998 - has
not posed a conflict of interest because the antipsychotics,
antidepressants and dementia drugs he promotes have never been
discussed by the panel.

      He declined to name the drugs, citing confidentiality
agreements. If those drugs came up for discussion, he said, he
would disclose his connections and abstain from voting.

      Simon said he should be able to vote on drugs made by the
companies that pay him, as long as they don't come from the
neuroscience or psychiatric divisions that pay him. But, he said,
he would not oppose a stricter standard.

      "There's absolutely no record of my biasing in favor of one
company or another or any of them," Simon said. "I figure the
preferred drug should be the one that cuts the best deal with the
state."

      Spokesmen for Eli Lilly and AstraZeneca said their companies'
relationships with Simon had nothing to do with his role on the
panel.

      Lilly spokesman Phil Belt said Simon even voted against Lilly
products, including a growth hormone and an insulin.

      "It just wouldn't be appropriate to assume or imply that our
relationship with him is in any way a product of or influenced by
his role on the Drug Formulary Committee," Belt said.

      Straka, a University of Minnesota pharmacy professor, earned
$78,100 in honoraria and other fees from 2000 to 2006, including
$36,745 from Schering-Plough Corp. and $24,623 from Merck & Co. He
served on the panel from September 2000 to March 2006.

      Straka said he was paid for educational talks usually arranged
by medical groups who lined up the sponsors. He said he routinely
discloses his ties with drug makers and did so as a formulary
committee member, both verbally and in writing.

      "I have no problem with the issue of fully disclosing things. I
do that all the time," Straka said.

      But a public records request by the AP turned up no information
about Straka making such disclosures. Nor do such statements appear
in the committee's minutes going back to February 2001. Other
committee members and staff interviewed by AP could not recall him
disclosing compensation from drug makers.

      The information about Straka's earnings 
might not have come out
at all, because drug companies are not required to disclose
payments to pharmacists under the Minnesota law. Many did so anyway
in his case, with some listing him as an "M.D." in their reports.

      Some of the committee's past discussions appear awkward in light
of the payments.

      The December 2004 minutes noted Simon speaking up for a staff
proposal to put Strattera, an Eli Lilly drug for attention deficit
disorder, into a category of its own with no prescribing
restrictions. There's no mention of his significant financial ties
to Lilly.

      "Dr. Simon affirmed the Department's decision, stating that
having a non-controlled substance, non-stimulant drug available
without PA restrictions was a valuable option," the minutes said.
PA refers to prior authorization, the procedure used to limit use
of a drug.

      Simon said Strattera was never the subject of his paid talks. He
said he's certified in addiction psychiatry and supported ease of
access to the non-stimulant Lilly drug because he's concerned about
overuse of stimulant drugs.

      Two months earlier, in October 2004, the committee took up
cholesterol-lowering statin drugs, including Pfizer's Lipitor and
Merck's Zocor. Straka's motion to include both Lipitor and Zocor on
the state's preferred drug list passed on an unusually divided 3-2
vote, although no individual votes were recorded.

      The January 2005 minutes say Straka questioned a staff request
to revisit the issue after the agency discovered that giving both
drugs preferred status would cost an extra $1 million a year. The
panel voted 6-1 to let the state pick one statin to cover. Again,
individual votes weren't recorded.

      The minutes say nothing about Straka being paid by Pfizer or
Merck - although the companies' disclosure reports show him getting
$3,000 from Pfizer and more than $24,000 from Merck by that point.

      When asked if the payments influenced his actions on the panel,
Straka responded with an emphatic no.

      "Absolutely not," said Straka. "I vote based on facts, I vote
based on evidence and that's completely discussed at those
meetings."

      Dr. William Korchik, the panel's chairman, said he supports
disclosure of committee members' relationships with drug companies,
"whether it's stock, research or speaker's fees."

      Korchik said he didn't know the extent of the financial
relationships until contacted by AP. But Korchik defended the
panel's work, saying the ties did not bias a group that works
mainly by consensus.

      "This whole thing may be an issue of appearance of conflict,
but I really feel comfortable that the committee has not been
hoodwinked," he said.

      Al Heaton, a pharmacist who has served on the committee since
the early 1990s, is the only panel member mentioned in the last six
years of minutes for disclosing a potential conflict of interest
and abstaining from a vote - on bone drugs he had gotten funding to
research years earlier.

      "I think that's important to know," said Heaton, the director
of pharmacy at Blue Cross and Blue Shield of Minnesota.

      "An individual may be perfectly honest and totally objective,
but finding it out afterward, then you always wonder were they or
were they not?"

Science

Politics and Government News

Martiga Lohn

Author

An Associated Press review of records in Minnesota found that a
doctor and a pharmacist on a state panel that helps select which drugs are used in Medicaid programs got big checks  from
pharmaceutical companies.

Drug company money presents appearance of conflict of interest on state panel

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