The Secrets in Eli Lilly’s Cabinet

In deciding whether to allow Eli Lilly to continue to use court orders to hide documents that show the company illegally marketed Zyprexa for unapproved uses and failed to warn the public about the serious health risks associated with the drug for a decade, the court needs to consider the harm done to the public by Lilly’s conduct.

The public has a right to know everything about the drugging for profit scheme revealed in the documents since the majority of profits made off Zyprexa came from the public trough. The court needs to recognize the harm done to tax payers in billing public health care programs like Medicaid for the massive off-label sale of the drug. According to the October 23, 2005, San Francisco Chronicle, nationwide, Medicaid programs purchase an estimated 60 to 75% of antipsychotic drugs.

In California for instance, in the year ending June 2005, Zyprexa was the highest expenditure at close to $250 million. On November 28, 2005, the Indianapolis Business Journal listed Zyprexa as the most costly antipsychotic covered by South Carolina’s Medicaid program with a month’s supply of 20-milligram tablets costing South Carolina $700.52 at the time.

On September 29, 2005, Bloomberg News stated that Medicaid could reduce the “$5.5 billion it spends annually on schizophrenia drugs for the poor” because a study found the cheaper generic, perphenazine, about as effective as new drugs, including Zyprexa.

“The 40-year-old drug perphenazine costs less than $1.50 a day,” Bloomberg wrote, “while the newer medicines can cost 10 times as much.”

When buying a 3-month supply, at drugstore,com, the retail price for Zyprexa in September, 2005 was $1,500, and a 3-month supply of perphenazine, was only $135.

Lilly has even found ways to convince doctors within the Veteran Administration’s hospital system to prescribe Zyprexa rather than the older, cheaper and equally effective drugs. Dr Robert Rosenheck, a Director with the Department of Veterans Affairs, reviewed the prescribing records for schizophrenic patients in the VA system for 2003 and found that more than 80% were on the new antipsychotics. He calculated that the VA spent more than $208 million on antipsychotics that year, with over $106 million, or more than half, spent on Zyprexa.

According to the New York Times, the company documents at issue show that Lilly knew full well about Zyprexa’s association with diabetes and weight gain that often leads to diabetes. The public’s right to know about this charge can not be easily dismissed considering the costs to the public of paying for the care of the tens of thousands of Zyprexa victims who developed diabetes.

By using fraud, kickback and antitrust statutes, state attorneys general all over the US are filed lawsuits against Lilly to recover the money paid for Zyprexa, and the medical costs for patients harmed by Zyprexa, whose health care is covered by public programs.

In February 2006, West Virginia and Alaska filed lawsuits against Lilly alleging the company marketed Zyprexa for unapproved uses in those states and as a result it has cost millions of dollars to care for patients who developed diabetes and other diseases.

West Virginia is seeking payment for all medical costs related to Zyprexa, in addition to the more than $70 million the state paid for the drug. The lawsuit says studies have linked Zyprexa to diabetes since 1998, and that sales representatives misled doctors about the safety and the efficacy of Zyprexa and that Lilly’s advertisements deceptively understated its risks and overstated its benefits.

The complaint alleges that Lilly promoted “off label” prescriptions for a host of conditions including anxiety, sleep disruption, mood swings, attention deficit hyperactivity and dementia. “Lilly benefited from its misrepresentations and fraudulent conduct by gaining sales of Zyprexa at the expense of other, safe, effective drugs,” the complaint states.

A lawsuit was filed by the attorney general of Mississippi, JimHood, in July 2006, to recoup the ill-gotten gains that Lilly enjoyed by promoting the off-label use of Zyprexa in that state, and alleges that Lilly knew Zyprexa increased the risk of diabetes, because in April, 2002, nearly a year and a half before Lilly first warned doctors and consumers in the US, the company changed Zyprexa’s labeling in the UK and Japan to include warnings about the drug’s association with diabetes related injuries.

Tim Balducci, Mississippi special assistant attorney general, says Lilly targeted Mississippi because the state,s Medicaid program is not set up to signal when a doctor prescribes a drug off-label.

According to Mr Hood, about 10% of Zyprexa patients have developed diabetes, some of whom are children, even though Zyprexa “has never been approved for, nor found to be effective, in the treatment of children.”

The fact is, Lilly has doctors prescribing Zyprexa off-label to children and billing state Medicaid programs all over the country. For instance, a study in the August 3, 2004, Archives of Pediatric Adolescent Medicine, found the number of Tennessee children covered by TennCare, who were prescribed antipsychotics nearly doubled in six years. The largest increases were among children aged 13 to 18 at 116%, followed by a 93% increase in children aged 6 to 12, and a 61% increase in use with preschool children.

In Texas, a review of prescription records for the months of July and August 2004, found that more than 19,400 teenagers were prescribed antipsychotics billed to a publicly funded program, according to ACS-Heritage, a medical consulting firm hired by the state to investigate the use of psychotropic drugs on children.

With nearly 98% of the teens, ACS reported, the antipsychotics were prescribed off-label and in more than half of the cases, the dosage appeared to be inappropriately high. The study also said that almost half of the children did not appear to have a valid diagnosis warranting the use of the drugs, and one-third were on 2 or more drugs.

Research published in the March/April 2006 Journal of Ambulatory Pediatrics, led by Dr William Cooper at Vanderbilt University, analyzed data drawn from the National Ambulatory Medical Care Survey and the National Hospital Ambulatory Medical Care Survey, which are national samples of health care services rendered to the US population and conducted by the National Center for Health Statistics.

Between 19952002, the study found that there were nearly 6 million outpatient visits to health care providers by children between the ages of 2 and 18, during which an antipsychotic was prescribed. Nearly 80% of the visits occurred in physician,s offices, 14% in outpatient clinics, and 9% in emergency departments.

The authors of the research pointed out that there had been no increase in mental health disorders that could account for the increases “as recent studies do not suggest significant increases in the incidence of schizophrenia,” they stated.

“In addition,” the researchers noted, “schizophrenia and psychosis accounted for only 13.5% of the total antipsychotic visits during the study period, so this diagnosis alone could not explain the increase.”

“Therefore,” they said, “the most likely explanation for the study results is that similar to our findings in the Tennessee Medicaid population, there was a substantial increase in physician prescribing of antipsychotics during the study period.”

Experts say the side effects of Zyprexa are more common and severe in children than in adults. The Children’s Hospital of Philadelphia recently found that 19% of children who were newly diagnosed with Type 2 diabetes were being treated with the new antipsychotics.

Zyprexa is not only dangerous when used by children, it is less effective than the older cheaper antipsychotics. A study published in August 2006, by the New York Psychiatric Institute, found that the older antipsychotics worked much better, with the average response rate in children using the new antipsychotics at only 55.7%, compared to a 72.3% response rate among children who were given the older drugs.

The study also found that the average weight gain in patients treated with the older drugs was much lowers and the sedation side effect was less common. The authors of this study also pointed out that the FDA “has not approved any antipsychotic drugs for treating childhood schizophrenia; yet, clinicians routinely use medications for this disorder.”

There is no doubt that Lilly knew about these serious health risks long before it issued warnings in the US in 2003. In a study published in the July 2002, journal Pharmacotherapy, P Murali Doraiswamy, the chief of biological psychiatry at Duke University, reviewed the FDA adverse event reports submitted on Zyprexa and found 289 cases of diabetes reported, with 225 patients being newly diagnosed.

In addition, the review showed that 100 patients developed ketosis, a serious complication of diabetes, and 22 people developed pancreatitis or inflammation of the pancreas that is life-threatening. The review identified 23 deaths, including a 15-year-old who died of necrotizing pancreatitis.

Last month, the New York Times reported details from the documents that Lilly wants to keep hidden, and revealed that Lilly sales representatives were promoting Zyprexa with primary care physicians specifically for the off-label treatment of dementia.

Before allowing Lilly to keep this information secret, the court needs to consider the harm being done to elderly citizens. On April 11, 2005, the FDA announced that elderly patients with dementia who were given antipsychotics were far more likely to die prematurely than those given placebos and also announced the addition of black box warnings about the increased risk of death on the labels of Zyprexa and the other atypical antipsychotics.

A June 13, 2005, study in the Archives of Internal Medicine, reviewed antipsychotic use in nursing home for approximately 2.5 million Medicaid beneficiaries and found that “over half (58.2%), received drugs that exceeded the maximum recommended dosage, received duplicate therapy, or had inappropriate conditions for the drugs to begin with. The study determined that more than 200,000 residents received antipsychotic therapy but had “no appropriate indications for use.

In October 2005, the Journal of the American Medical Association published a meta-analysis of trials of more than 5,000 elderly patients treated with atypical antipsychotics that found that patients had a 54% increased chance of dying within 3 months, compared to patients taking a placebo.

Lilly has also been actively promoting the off-label sale of Zypexa in other countries. In August 2006, Janet Currie, the director of the Victoria-based Psychiatric Medication Awareness Group in Canada, called for a public inquiry into the use of atypical antipsychotic because they are being prescribed to children and the elderly for sedation and behavioral control.

According to Ms Currie, Zyprexa is a special authority drug that may only be prescribed under special criteria and the patient must have been diagnosed with schizophrenia or other non-dementia-related psychosis and other antipsychotic drugs must have failed, or not been tolerated by the patient.

In Canada, payment for Zyprexa comes from the government funded PharmaCare program and according to BC health ministry data, the program paid $26,493,119 for Zyprexa in 2005.

Lilly is also facing numerous lawsuits in Canada alleging the exact same conduct revealed in the documents that Lilly is trying so desperately to suppress. According to Lilly’s SEC filings, in 2005 the company was served with four lawsuits seeking class action status in Canada on behalf of patients who took Zyprexa, and one of the lawsuits has been certified for residents of Quebec.

“The allegations in the Canadian actions,” Lilly states in the filing, “are similar to those in the litigation pending in the United States.”

A lawsuit filed in New York in August 2004, on behalf of private health insurers accuses Lilly of violating racketeering laws, in part, by bankrolling nonprofit groups to promote Zyprexa for unapproved uses and to downplay the medicine’s side effects.

Evidence to support these allegations can be found in Kentucky. When Kentucky held public hearings to try to exclude Zyprexa from Medicaid’s list of covered drugs, the most notorious Big Pharma backed front group in the US, the National Alliance for the Mentally Ill, bused in protesters for the hearings, placed full-page ads in newspapers, and sent faxes to state officials. However, a little known fact is that by funneling money through NAMI, Lilly paid for the buses, ads, and faxes, according to the December 18, 2003 New York Times.

Should the court continue to allow Lilly to hide the documents with the incriminating information, it will not be surprising to many experts. For as pediatrician, Dr Lawrence Diller, author of the book, “Should I Medicate My Child,” stated in language relevant here, while testifying before an FDA advisory committee in September 2004, regarding the conduct of companies concealing the adverse effects of drugs and promoting off-label prescribing:

“The blame is clear: The money, power and influence of the pharmaceutical industry corrupt all. The pervasive control that the drug companies have over medial research, publications, professional organizations, doctors’ practices, Congress, and yes, even agencies like the FDA, is the American equivalent of a drug cartel.”

And it is clear in this instance, that the thousands of lawsuits filed against Lilly have done nothing to deter it from promoting the off-label sale of Zyprexa. According to Lilly’s SEC filings, sales worldwide in the second quarter of 2006, were $1.12 billion, a 2% increase over the second quarter of 2005.

In the filing, Lilly noted that US sales of Zyprexa were down 1%, but said the company simply charged a higher price for the drug to make up for the lower sales.

To date, Lilly has agreed to pay about $1.2 billion to settle claims with roughly 26,000 litigants who alleged among other things, that the company promoted the sale of Zyprexa for off-label uses and concealed the health risks associated with the drug.

But legal experts say to look for more settlements soon as Lilly tries to avoid public trials in the Medicaid fraud cases, where it will be easy to prove that Zyprexa sales would have spiraled downward long ago, had Lilly quit promoting the drug for off-label use.

EVELYN PRINGLE is an investigative journalist. She can be reached at: