Donations tie drug firms and nonprofits
Source: Philadelphia Inquirer
TheAmerican Diabetes Association, a leading patient health group, privately enlisted an Eli Lilly & Co. executive to chart itsgrowth strategy and write its slogan.
The National Alliance onMental Illness, an outspoken patient advocate, lobbies for treatmentprograms that also benefit its drug-company donors.
TheNational Gaucher Foundation, a supporter of people suffering from a horrific rare disease, gets nearly all its revenue from one drugmaker, Genzyme Corp.
Although patients seldom know it, many patientgroups and drug companies maintain close, multimillion-dollarrelationships while disclosing limited or no details about the ties.
Ata time when people are making more of their own health-care decisions,such coziness raises questions about the impartiality of groups thatpatients trust for unbiased information. It also poses a challenge forgroups trying to hold patients’ trust and still raise money to servethem.
An Inquirer examination of six groups, each a leadingadvocate for patients in a disease area, found that the groups rarelydisclose such ties when commenting or lobbying about donors’ drugs.They also tend to be slower to publicize treatment problems thanbreakthroughs. And few openly questioned drug prices.
At thesame time, the groups perform an important function by providing services unavailable elsewhere, such as patient education and help in obtaining medications or affording insurance.
They also try topolice themselves. For example, each declares it does not endorse orreject products. All formally require that industry grants be”unrestricted,” meaning that there are no strings attached. One ofthem, Children & Adults with Attention Deficit/Hyperactivity Disorder, or CHADD, formally caps pharmaceutical donations.
Combined,the six received at least $29 million from drug companies last year,according to tax returns and annual reports. The amount ranged from 2percent to 7 percent of revenue at the Arthritis Foundation, to 89percent to 91 percent at the much smaller National Gaucher Foundation.
Somehealth-care experts, although applauding the groups’ work, are callingfor greater disclosure. And many patients expressed surprise at theties.
“I don’t think that would make a difference as far astaking a drug,” said Gloria Antonucci, 65, leader of a MontgomeryCounty pain-support group that relies on Arthritis Foundation advice.”But I think it would make me, maybe, 250 percent more skeptical aboutwhat the group is saying.”
Jerome Kassirer, a Tufts Universityand Yale University medical school professor and author of On theTake: How Medicine’s Complicity With Big Business Can Endanger YourHealth, said better disclosure would guard against abuse.
“These organizations are susceptible to industry influence because they have trouble raising money themselves,” Kassirer said.
Butnot all nonprofits are alike, said Marc Boutin, executive vice president of the National Health Council, a standard-setting coalition funded by nonprofits and drug companies. He said leading nonprofits with “fire walls” against donor influence were worlds apart from questionable organizations.
“We are controlled by volunteers whoare living with a condition and the drugs they take, and I guaranteethese people would not be influenced by a donor,” Boutin said.
Matter of credibility
Fordrug companies, patient groups carry credibility that the industry sometimes lacks to target patients and “opinion leaders” who drive prescriptions, and hence, sales. Nonprofits also help patients stay on the medicine and push insurers to pay for it.
“Does it help us?Sure,” said Matthew Emmens, Wayne-based chief executive officer ofShire PLC, the No. 1 ADHD drugmaker and a major donor to CHADD.
“Inthe industry, we feel we’re doing a pretty good thing while making money, which is even better,” said Norm Smith, president of Langhorne-based Viewpoint Consulting Inc. and veteran marketer for Merck & Co. Inc., Johnson & Johnson and others.
Thedonations are sometimes portrayed by the companies and nonprofits as”giving back” to patients. But the funding usually comes from the companies’ marketing or sales divisions, not charity offices, company and nonprofit officials said. Grants often rise with promotional spending as a drug hits the market and fall when sales ebb.
Donationsfrom Merck and Pfizer Inc. to the Arthritis Foundation more thandoubled, to at least $1.65 million combined, in 2000 as they launchedVioxx and Celebrex. The donations fell below $375,000 by 2004, whensafety fears had flattened sales, foundation reports show.
Merckexplicitly wove the foundation into sales strategies. A 2001 internalmemo, disclosed in product-liability trials, shows that Merck soughtto use the foundation’s pain-management program to “demonstrate additional benefits” of its products.
Foundation president JohnKlippel said he was unaware of Merck’s plan. But he dismissed it as anexample of mutual interests in treatment, not profits. “We envisionthat as an educational program,” he said. “Their marketing folksenvision it as marketing.”
When interests diverge, however,groups must be ready to face donor pressure. Michael J. Fitzpatrick,president of the National Alliance on Mental Illness, or NAMI, saidone donor recently demanded that, in return for funding a TVpublic-service announcement, the ad include the company’s directcontact information. Fitzpatrick said NAMI refused.
The industryalso benefits in Washington and state capitals, where nonprofits lobbyfor issues such as expanded Medicaid drug coverage or treatmentprograms. That can boost sales.
All six groups are activelobbyists. NAMI, for example, urges and helps states and localities tocreate special one-on-one “assertive” treatment programs, whichinclude making patients take their medicine.
It acknowledgedthat drug-company donors may benefit but insisted that’s not the goal.”Nobody from the pharmaceutical industry tells us what to do,” NAMIpresident Fitzpatrick said.
Unusual corporate gift
In2000-2001, the American Diabetes Association did not disclose an unusual gift from Lilly: a lent executive, Emerson “Randy” Hall Jr., who moved into its Alexandria, Va., headquarters and coached it on growth strategies, all paid by Lilly.
Vaneeda Bennett, the ADAvice president for development, denied that the gift compromised thegroup but conceded that it might look bad. “We always walk a fine lineon showing favoritism to one company or another. I would imagine othercorporate donors would look askance at it,” Bennett said, adding that,if it were offered again, “we’d ask for money.”
Hall, aPhiladelphia native now retired and living in Princeton, said he nevertried to influence the group and merely helped it market itself,including writing its slogan, “Cure. Care. Commitment.” He estimatedthat his work, including diabetes patient research he subsequentlyshared with Lilly, would have cost “hundreds of thousands” from acontractor.
Asked why it did not cite Hall on its tax returns orannual report, ADA spokeswoman Diane Tuncer said: “There is not arequirement to do so.”
Nonprofit experts laud such executive “loans,” as long as groups disclose them and limit their authority.
Anothergroup, NAMI, did not disclose that Lilly marketing manager GeraldRadke briefly ran its entire operation. Radke began in 1999 as a Lilly-paid “management consultant,” then left Lilly and served as NAMI’s paid “interim executive director” until mid-2001. The group acknowledged this only after being shown Radke’s resume listing the job.
NAMI’s president, Fitzpatrick, said he did not know whyhis predecessors did not disclose Radke’s work. He said using Radke”was a reasonable move to try to increase capacity.”
“But there is a perception issue,” he said. “So that makes it, in hindsight, a difficult choice.”
Radke,of Harrisburg, declined to comment. After NAMI, he ran the Pennsylvania Office of Mental Health and Substance Abuse, and now serves in the state Health Department.
Indianapolis-based Lilly,which donated at least $2.5 million to the ADA and $3 million to NAMIbetween 2003 and 2005, called its executive loans mutually beneficial.”The primary goal is to assist that organization in developing aneeded capacity or function, but it also often serves to assist in thecareer development of the employee,” a Lilly spokesman, Edward G.Sagebiel, said.
Drug marketers battlehardest over safety and effectiveness, and nonprofits say they striveto avoid favoring one product over another. The six appeared to becautious on safety scares and rarely took the lead soundingdrug-safety alerts, even as they highlighted news of drug breakthroughs and approvals they say members demand, their materials show.
“We don’t position ourselves as a watchdog,” said Bennett of the ADA.
TheADA, which received 5 percent to 10 percent of its revenue last yearfrom drug companies, reported little initially in 2004 about suspecteddiabetes risks from antidepressants. Instead, Tuncer, its spokeswoman,said it convened an expert conference – funded by drug companies – andended up echoing the concerns.
The Arthritis Foundation, whichreceived 2 percent to 7 percent from drug companies, said little in2000 about early studies raising questions about Vioxx. But whenfollow-up studies confirmed the concerns in 2001 and 2002, the grouphighlighted the problems and called for more safety research. A yearlater, Merck cut off all donations.
Patrick Davish, a Merckspokesman, denied any link between the donation cutoff and criticism,calling it just a “change in funding priorities.”
Klippel, thegroup’s president, said he doubted there was a link but said it wouldnot matter anyway. “It’s not to say they’ve not been unhappy with usfrom time to time,” he said. “But it would not influence me.”
TheADHD group, while calling itself a science-based information clearinghouse, has not published some critical information about ADHD drugs, including an FDA warning last September about suicide risk from Strattera, made by one of its biggest donors, Lilly.
Its chiefexecutive, E. Clarke Ross, said the group’s professional advisoryboard took time to review all information before posting it. Althoughthe group is an outspoken proponent of ADHD drugs, he said, it hasstrict fire walls against corporate influence. Indeed, it was alone among the six in publishing an easy-to-find figure on pharmaceutical donations: 22 percent last year, or $1.01 million.
“We have a number of conflict-of-interest practices that meet industry standards,” he said.
NAMI, like most groups, lists only FDA-confirmed side effects and typically refers people with any questions to the drugmaker.
Oneoutspoken NAMI critic, David Oaks of the support group MindFreedom, described the group as an independent but willing pawn of industry.
“We’renot saying there is some conspiracy in a skyscraper by a pharmaceutical executive rubbing his hands together,” Oaks said. “It’s that the entire paradigm is owned by the drug companies, and that the hazards of the drugs, like brain damage, are not discussed.”
NAMI’sFitzpatrick defended its information, but acknowledged that groupswere facing demands for fuller drug information. “I think we should bemuch more like Consumer Reports. We should have transparency on bothside effects and benefits,” he said.
Close ties on orphan drugs
Tiesbetween drug marketers and patient groups appear closest on so-calledorphan diseases, which involve relatively few patients, experts anddrugmakers. Financial disclosures by two groups show they used most ofthe deductible donations to pay the medical bills and insurancepremiums of patients using donors’ products. That, in effect, spreadsaround costs while leaving pharmaceutical prices unchanged.
TheNational Organization for Rare Disorders, a Connecticut-based coalition that tries to spur development of orphan drugs, got $10.5 million – 68 percent of its revenue – from drug companies last year.It helps pay patients’ premiums and bills, administers companies’ free-drug programs and helps recruit patients for their clinical trials.
Founder Abbey S. Meyers said that donors did not shapeher group’s positions and noted that the industry needed the groups asmuch as they needed it: “I criticize them [donors] all the time. Ithas never come back to hurt us.”
The Gaucher group, accordingto tax returns, received $1.77 million of its $2 million in revenuelast year from Boston-based Genzyme, and spent $1.69 million onmedical bills and insurance premiums of patients taking Genzyme’senzyme therapy Cerezyme, which cost insurers as much as $350,000 ayear.
In contrast, the foundation took nothing from ActelionPharmaceuticals US Inc., of San Francisco, maker of a second-linetreatment, Zavesca, to be used when Cerezyme doesn’t work. Actelionsaid the foundation rejected its no-strings grants and gave little oronly critical Zavesca information.
“I don’t want to sayanything nefarious is going on. But it doesn’t pass scrutiny,” saidActelion’s president, Shal Jacobovitz. He portrayed the foundation”almost as a commercial arm” of Genzyme.
Ronda P. Buyers,executive director, denied that the group is biased toward Genzyme.”We’re two different organizations. We do get its money, which allowsus to do what we do,” she said.
Another company, Shire HumanGenetic Therapies, formerly Transkaryotic Therapies Inc., which isdeveloping an alternative to Cerezyme, also called the foundationunusually close with Genzyme, even though it had accepted Shire’ssmall donations.
Genzyme “is aggressive, and it’s all part oftheir marketing plan to have a dominant position,” said Matt Cabrey, aShire spokesman in Wayne.
David Meeker, president of Genzyme’slysosomal business unit, said Genzyme had no control over thefoundation. He acknowledged that the group was so important forCerezyme marketing that if it didn’t exist, Genzyme would have lookedfor another.
“This is how we built our business,” said Meeker,whose company took in $932 million last year from Cerezyme, high foran orphan drug. “It’s also building a community where patients can getthe help they need. It’s the ultimate win-win.”
Buyers, who did not respond to repeated follow-up calls after an initial interview, said:
“Wecannot make them bring the price down. They do make a lot. But withoutthe drug, there would be all these people who would be in such horrible positions. More people would die.”
Contact staff writer Thomas Ginsberg at 215-854-4177 or email@example.com.
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