Bad Medicine: A Gift for Drug Makers–Malpractice Bill Shields Drugmakers

Sat, 15 Jan 2005

Knowledgable critics – among them practicing physicians, health care analysts, medical journal editors, journalists, and lay citizens–have reached the conclusion that America’s for-profit health care system – which eats up 16% of the budget–has failed to provide health care to all Americans, failed to improve health or longevity compared to other industrialized counties, and failed to contain costs. Americans pay more per capita for health care than any industrialized country in the world yet, rank 29th in life expectancy; 45 million Americans cannot afford costly insurance or needed treatments. Prescription drugs eat up healthcare budgets–$200 billion–without improving people’s health:

“Millions of us are popping prescription pills for innocuous ills, when simple lifestyle changes of diet and exercise–harped on by physicians for decades–are more effective and a lot cheaper. The results of pill dependence are insidious and devastating: billions of dollars in ever-higher drug costs; millions of people enduring sometimes highly toxic side effects; and close to 2 million cases each year of drug complications that result in 180,000 deaths or life-threatening illnesses in the elderly, one major study estimates. And every few years comes the ultimate medical catastrophe: a miracle cure that turns out to be toxic.” [ Forbes]

Instead of addressing the real problem which Dr. Jerome Kassirer attributes to “an epidemic of greed,” the President is agressively promoting a bill to cap damages for harm caused by unsafe drugs. The legislation’s intent is not to shield consciencious doctors from frivolous lawsuits – it’s aim is to shield pharmaceutical industry giants and negligent providers who are responsible for those hundreds of thousands of preventable deaths each year.

As New York Times columnist, Bob Herbert, correctly observes, if the malpractice legislation became law, Pfizer, Merck and Eli Lilly would be immunized against even the possibility of punitive damages arising from any harm to patients that resulted from use of these drugs – as long as the companies followed F.D.A. rules. All three drugs – Vioxx, Celebrex, and Prozac– were approved by the F.D.A.”

The legal system is the last line of defense for citizens who have been harmed and to serve as a deterrent for companies that consider marketing unsafe products. But if enacted the bill would strip citizens of their right to seek just compensation for harm from pharmaceutical companies that have reaped huge profits by knowingly marketing lethal drugs and withholding those risks from the public.

Former Congressman James Greenwood, who shamelessly negotiated a deal on the eve of a hearing he was to chair about industry’s deceptive marketing of SSRI antidepressants, now president of the Biotechnology Industry Organization, is lobbying for legislation that would not only limit punitive damages for corporate wrong doing – such as concealing lethal drug effects–but would also to limit damages for pain and suffering to $250,000.

The effort to block citizens from seeking just compensation from corporate giants who deliberately concealed hazardous effects of drugs / vaccines / medical devices – thereby endangering human lives to boost sales would result in a gross miscarriage of injustice. Why should drug manufacturers who knew the drugs they sold and advertised as “safe,” to have lethal side effects, be shielded from responsibility?

1. See: Just Say No by Robert Langreth, FORBES 11.29.04 http://www.forbes.com/forbes/2004/1129/102_print.html or https://ahrp.org/infomail/04/11/16.php

2. Jerome Kassirer, On the Take: How Medicine’s Complicity with Big Business Can Endanger Your Health, Oxford Press 2004.

Contact: Vera Hassner Sharav
212-595-8974

Bad Medicine
By David Morris, AlterNet
January 10, 2005, Printed on January 14, 2005

“One of the major cost drivers in the delivery of health care are these junk and frivolous lawsuits,” President Bush has told the American people, offering up his proposals to cap non-economic damages to patients injured by medical negligence. Here are seven facts that prove him wrong:

1. Insurance rates do not vary with the amount of claims paid out as much as with the amount of investment income that comes in.

“During the 1990s, insurers competed vigorously for medical malpractice business, and several factors, including high investment returns, permitted them to offer (artificially low) prices … ” according to the Government Accountability Office. When stock prices and bond interest rates fell, insurer income plummeted, prompting companies to increase rates to make up for the losses. Even the Congressional Budget Office has said that at least half of the rate increases from 2000 to

2002 were prompted by declining investment returns. The other half were a result of major companies, like the Saint Paul Company (now Saint Paul Travelers), withdrawing from the malpractice insurance business altogether because of the investment return declines. Thousands of physicians were forced to scramble for alternatives. Many charged exorbitant prices. The insurance crises in some states, like West Virginia, Nevada and Pennsylvania, may largely be attributed to Saint Paul Company’s withdrawal.

2. Medical malpractice insurance accounts for less than 2 percent of overall health care spending. Even that percentage is falling because insurance rates have been rising at less than half the rate of increase in overall health costs.

3. Since 1996, the number of malpractice claims has been flat. The average payout has increased only slightly. According to the National Practitioners Data Bank (NPDB), a government service that tracks malpractice claims, verdicts and settlements, the median payout for medical malpractice claims rose from $100,000 in 1997 to $135,000 in 2001. The size of the award closely tracked the severity of the injury.

4. Only 1 of 8 patients who suffer injury due to medical negligence ever file a malpractice claim.

5. Caps on medical malpractice awards for pain and suffering have not resulted in decreased malpractice insurance rates. In the first 10 years after California imposed a $250,000 cap in 1975, state rate increases were the same as the national average. It was only after Proposition 103 passed in 1988 that insurance rates in California began to decline in comparison to those in other parts of the country. The reason? Proposition 103 instituted insurance reforms, not “tort reform.” It disallowed unnecessary insurance costs like bloated executive salaries and excessive expenses and it required insurers to open their books to justify rate increases.

6. A tiny fraction of doctors account for the majority of malpractice awards. From September 1990 to September 2002, only 5.1 percent of doctors paid two or more malpractice awards. But these doctors accounted for 54 percent of all payouts.

7. State medical boards are reluctant to discipline incompetent doctors. One study found that only 1 out of 6 doctors who had five or more malpractice payouts had been disciplined.

In 1986, the New York state legislature commissioned an interdisciplinary team of physicians, attorneys, economists, statisticians and social research experts to diagnose the problem of soaring liability insurance premiums. Their conclusion? “(F)inding fault with the tort system is easy; what is difficult is identifying an alternative that, on balance will do better.”

The medical insurance system needs fixing. One remedy is to make insurance companies more accountable. Eight of the 10 states with the lowest medical malpractice insurance rates require an approval process before the companies can raise rates. Another remedy is to require insurance companies to broaden the risk pool by combining doctor specialties so that individual disciplines, like gynecology, where mistakes can be devastating, are not disproportionately burdened.

The medical system needs fixing too. A horrifying statistic in a March 2000 report by the prestigious Institute of Medicine testifies to the problem. Between 44,000 and 98,000 people die each year as a result of medical mistakes. One reason may be the astonishing number of hours – up to 120 hours a week – interns and residents work, including 36-hour shifts for several weeks at a time. Sleeplessness breeds mistakes. A bill introduced in Congress last year would limit the resident workweek to 80 hours.

Studies have also found a higher risk of dying in hospitals where nurses have heavier workloads. One analysis concluded that every additional patient per nurse results in a 7 percent increase in both patient mortality and deaths following complications. There is a problem in the medical industry. But the facts indicate that it is not caused by the patients or their legal representatives.

© 2005 Independent Media Institute. All rights reserved.

THE NEW YORK TIMES
January 14, 2005
OP-ED COLUMNIST
A Gift for Drug Makers
By BOB HERBERT

Vioxx, Celebrex, Prozac. …

With all the problems and the bad publicity that drug companies have been facing recently, you might think that this would not be a good time for the Bush administration to toss yet another bonanza their way. But the administration is like an ardent lover in its zeal to shower the rich and powerful with every imaginable benefit. So tucked like a gleaming diamond in proposed legislation to curb malpractice lawsuits is a provision that would give an unconscionable degree of protection to firms responsible for drugs or medical devices that turn out to be harmful.

The provision would go beyond caps on certain damages. It would actually prohibit punitive damages in cases in which the drug or medical device had received Food and Drug Administration approval. We know the F.D.A. has failed time and again to ensure that unsafe drugs are kept off the market. To provide blanket legal protection against punitive damages in such cases is both unwarranted and dangerous.

We learned just last month that Celebrex, the phenomenally popular painkiller from Pfizer, more than tripled the risk of heart attacks, strokes and death among those taking high doses in a national trial. Those findings, as noted in an article in The Times, “raised new questions about how well federal drug regulators protect the public and worsened drug makers’ already dismal image.” Senator Chuck Grassley, an Iowa Republican who held hearings on recent F.D.A. actions, said, “At this point, no one can say with confidence whether the worst drug safety problems are behind us or ahead of us.” The Celebrex disclosure came on the heels of a decision by Merck to withdraw its arthritis drug Vioxx from the market after a study showed a link between long-term use of the drug and an increased risk of heart attacks and strokes.

Two weeks ago, an article in The British Medical Journal suggested that Eli Lilly & Company had long concealed evidence that the antidepressant Prozac could cause violent and suicidal behavior. The company denies the accusation, which the journal forwarded to the F.D.A.

If the malpractice legislation so relentlessly touted by President Bush became law, Pfizer, Merck and Eli Lilly would be immunized against even the possibility of punitive damages arising from any harm to patients that resulted from use of these drugs – as long as the companies followed F.D.A. rules. All three drugs were approved by the F.D.A.

The whole idea behind punitive damages is to severely punish the most egregious offenders. Huge punitive damage awards are supposed to serve as a deterrent to extremely bad behavior. “It’s an important system to have in place,” said Joanne Doroshow, executive director of the Center for Justice and Democracy, a nonprofit consumer advocacy group. “The F.D.A. is certainly not doing its job. The legal system is a very important backup. It’s really the last line of defense to ensure that the marketplace only has safe products.”

If Mr. Bush has his way, that line of defense will be substantially weakened. With the possibility of punitive damages eliminated, drug companies will be even less vigilant than they are now about problems with products that pose a serious – even fatal – threat to patients. The Democratic leader in the Senate, Harry Reid of Nevada, was blunt on the matter. He said, “Congress should not be giving a free pass to big drug companies at a time when millions of Americans may have had their health put at risk by pharmaceutical giants.”

The drug companies have an incredible racket going, as Marcia Angell, the former editor in chief of The New England Journal of Medicine, documents in her book “The Truth About the Drug Companies.” “Now primarily a marketing machine to sell drugs of dubious benefit,” she wrote, “this industry uses its wealth and power to co-opt every institution that might stand in its way, including the U.S. Congress, the Food and Drug Administration, academic medical centers, and the medical profession itself. (Most of its marketing efforts are focused on influencing doctors, since they must write the prescriptions.)” Among those co-opted is the president himself. Nothing’s too good for the drug companies. If ordinary Americans got the same sweet treatment from this administration as the great pharmaceutical houses, we’d all be in a much better place.

THE WASHINGTON POST
Malpractice Bill Shields Drugmakers
By Jim VandeHei
Wednesday, January 5, 2005; Page A03

The medical malpractice bill backed by President Bush would prevent consumers from seeking punitive damages from the makers of Vioxx and Celebrex, two popular pain medications recently linked to increased risks of heart attacks and strokes, according to legal experts on both sides of the issue. While Bush often touts the medical malpractice proposals as a prudent way to stop frivolous lawsuits against doctors, the bill’s less-discussed liability protections for pharmaceutical companies such as Merck & Co., the manufacturer of Vioxx, is generating controversy this week.

The drug company provision has been in the Republican House bill, which Bush supports, for months, but after the Vioxx and Celebrex reports, the bill’s opponents are making the provision a key argument against the Bush plan. Supporters privately say the legislation may have to be changed to win approval. “I am sure it gives opponents a pretty good bludgeon,” said former representative James C. Greenwood (R-Pa.), who sponsored the bill, which passed the House but not the Senate. It must be reintroduced this year. Merck withdrew Vioxx on Sept. 30 after reporting that the painkiller increased the chance of a stroke or heart attack. Pfizer Inc., the maker of Celebrex, reported last month that in one study, its pain medication increased the risk of heart attack if taken in high doses. Pfizer has not pulled Celebrex from the market because it says there is conflicting research on the side effects. Critics charge that both companies sold the drugs despite warnings about side effects.

Both companies would be shielded from punitive damages — those jury awards that often reach into the millions of dollars to punish wrongdoing — if the medical malpractice plan becomes law. The bill would protect pharmaceutical companies from punitive damages as long as they met Food and Drug Administration standards to win approval of their drug. Merck and Pfizer received FDA approval for their drugs, and both say they followed FDA requirements. In a statement yesterday to try to preempt Bush’s speech on medical malpractice lawsuits today, Todd A. Smith, president of the Association of Trial Lawyers of America, said, “President Bush unashamedly advocates legislation that would protect insurance industry profits and prohibit any punishment for the makers of dangerous drugs like Vioxx.”

There is a disagreement over how much legal protection the Bush-backed plan would provide. Greenwood, now president of the Biotechnology Industry Organization, a corporate trade association, said he believes the legislation would also limit damages for pain and suffering to $250,000 for pharmaceutical companies. But others say only punitive damages would be limited for drug companies. That would allow consumers to seek large awards for pain and suffering in addition to economic damages, such as lost time at work.

Supporters say the provision, which applies to other health-care-related companies, is needed to create a sound judicial system for awarding victims of medical malpractice, be it by doctors, drug manufacturers or makers of medical devices. Under the current system, they say, defendants face a disadvantage because plaintiffs can threaten to seek multimillion-dollar judgments and thereby try to force a large settlement. The bill also would require drug companies to meet all FDA standards or lose the legal protections. “There is no entitlement to punitive damages,” said Victor E. Schwartz of the American Tort Reform Association. “If you have done everything the law requires, why should you be punished?”