“The moral test of a government is how it treats those who are at the dawn of life, the children; those who are in the twilight of life, the aged; and those who are in the shadow of life, the sick and the needy, and the handicapped.” – Hubert Humphrey
passionate pachyderms
Pharmacist Steve steve@steveariens.com 502.938.2414
Cigna owns the PBM Express Scripts – according to this articlehttps://www.drugchannels.net/2022/04/the-top-pharmacy-benefit-managers-of.htmlExpress Script is the SECOND LARGEST PBM, HOWEVER, recent announced merger between Humana & United Health, suggests that merger will push Express Script down to THIRD PLACE.
One of the basics of the practice of medicine is starting, changing, stopping a pt’s therapy. While Cigna is just denial payment for a particular therapy, not technically stopping the pt’s therapy, but few people can afford to pay “rack rate” for some fairly expensive tests and/or procedures. Some would argue that denying payment for a expensive test or procedure is basically stopping a pt’s therapy because the pt has a health insurance policy – which is technically a contract – and generally a contract between two parties and party is paying money for payment for necessary medical services and the other party ends up playing games and finding excuses to not fulfill the terms of the contract. Some would consider that FRAUD.
According to this lawsuit, this is not just a few examples, but involves denial of care to hundreds of thousands of pts and the denials are being done on a wholesale level.
Cigna Sued Over Algorithm Allegedly Used To Deny Coverage To Hundreds Of Thousands Of Patients
The software system allows claim rejections without doctors ever opening patient medical records, according to the lawsuit.
Cigna, the healthcare and insurance giant, was hit with a lawsuit on Monday that alleges the company systematically rejects claims in a matter of seconds, thanks to an algorithmic system put in place to help automate the process—further raising questions about how technology could harm patients as more healthcare organizations look to embrace AI and other new tools.
The suit, which was filed in California and is seeking class action status, was brought forth by a pair of plaintiffs who were denied coverage by Cigna. One plaintiff, Suzanne Kisting-Leung, was referred for an ultrasound because of a suspected risk of ovarian cancer. Another, Ayesha Smiley, had been tested for a vitamin D deficiency at the order of her doctor.
The health insurer’s digital claims system, called PXDX, is an “improper scheme designed to systematically, wrongfully, and automatically deny its insureds medical payments owed to them under Cigna’s insurance policies,” the complaint alleges.
After the lawsuit was filed Monday, Cigna defended the software system. “PXDX is a simple tool to accelerate physician payments that has been grossly mischaracterized in the press,” spokesperson Justine Sessions said in a statement. “The facts speak for themselves, and we will continue to set the record straight.”
The suit follows a Propublica investigation in March that detailed Cigna’s software system for approving and denying claims in batches. The algorithm works by flagging discrepancies between a diagnosis and what Cigna considers “acceptable tests and procedures for those ailments,” according to the lawsuit.
Over two months last year, the company denied more than 300,000 claims, spending an average of 1.2 seconds on each claim, Propublica reported. While medical doctors signed off on the denials, the system didn’t require them to open patient medical records for the review. The complaint says that this violates a California competition law for unfair and fraudulent business acts. The suit also alleges the system violates the state’s insurance code for failing to adopt a “reasonable standard” for processing claims.
The complaint comes as a boom in artificial intelligence and other advanced technology has raised questions about the future of work, potentially upending every industry from advertising to insurance. Healthcare is one sector where a high-tech makeover could both be beneficial—aiding doctors in filling out burdensome paperwork or helping narrow down diagnoses—but also fraught, due to issues of patient privacy, access to care and the high cost of medical bills.
Cigna isn’t alone in adopting new tech to remake its processes. In April, Google’s cloud division unveiled new tools for healthcare claims processing that uses AI to organize data and streamline decision-making. Blue Shield of California and Bupa are among the companies using the tool.
The firm representing the plaintiffs, Malibu, California-based Clarkson Law, has previously taken on tech giants when it comes to AI. Earlier this month, the firm filed lawsuits against OpenAI, the company behind ChatGPT, and Google, which has its own generative chatbot called Bard, for allegedly stealing the data of millions of people—including artists and writers who copyrighted their works—to train and build their AI products.
Pharmacy giant CVS continues to call them “isolated incidents” even after reports emerged earlier this month that the Ohio Board of Pharmacy found hundreds of problems that could endanger patients at eight of the company’s understaffed pharmacies.
Then on Thursday, the board released inspection reports from yet another CVS pharmacy that detailed additional serious problems. They include the loss of 1,800 doses of controlled substances and a patient who was harmed after being given the wrong medication.
CVS, the nation’s largest pharmacy retailer, has for years been buying out competitors, closing them and then transferring prescriptions from those pharmacies into the closest CVS stores. CVS workers told state inspectors and the Capital Journal that in at least some instances, CVS didn’t add to its already bare-bones staff to handle the extra business.
Severe understaffing at CVS stores seems to have contributed to weeks-long waits to fill prescriptions, lack of proper controls over narcotics, expired and adulterated drugs not being removed from shelves, prescriptions being improperly dispensed and other problems, according to Ohio Board of Pharmacy reports. In addition, the strain of such understaffing has contributed mass turnover at CVS pharmacies, inspectors reported and CVS workers told the Capital Journal.
Reports previously obtained by OCJ found problems at CVS pharmacies in Canton, Dayton, Columbus, Painesville, Toledo, Massillon, Wooster and Reynoldsburg. Then last week, it received inspection reports for CVS store No. 4351 in Willoughby, 20 miles northeast of Cleveland.
One said that on Jan. 13, 2022, a patient picked up a prescription for what was labeled ropinirole, a dopamine agonist used to treat symptoms of Parkinson’s disease, restless leg syndrome and other ailments.
“Patient 1 ingested approximately 27 tablets of the incorrect medication and experienced adverse effects including increased anxiety, rapid heart rate, and sweating,” the report said.
Weeks later, the mistake was discovered.
“On or about February 3, 2022, Patient 1 picked up a prescription refill from the pharmacy and realized the tablets looked different than those she had ingested from the previous bottle,” the report said.
While the initial prescription bottle was labeled ropinirole, it actually contained digoxin, the report said. That’s a drug used to treat heart failure and arrhythmia.
Even after switching to the correct medication, problems apparently persisted. The patient went to the emergency room on Feb. 14, 2022 for “accidental drug ingestion,” but no digoxin toxicity was found, the report said.
A pharmacist approved a prescription he shouldn’t have, but Board of Pharmacy investigators said other safeguards broke down as well.
“The dispensing software permitted the medication to be verified without scanning the bottle or alerting the pharmacist the standard safety procedure may or may not have been completed,” the report said.
Asked about the error, CVS spokesman Matthew Blanchette said in an email, “We have comprehensive policies and procedures in place to support prescription safety. Prescription errors are very rare, but if one does occur, we take steps to learn from it in order to continuously improve quality and patient safety.”
Investigators found other problems at the Willoughby pharmacy.
In April and May of 2021, the store reported the loss of the addictive sedatives lorazepam and diazepam, better known as valium. However, CVS reported in both cases that “the loss was not significant, listing the loss as 0 tablets.”
When the Board of Pharmacy contacted a CVS loss prevention manager, that person said, “the pharmacy was recently remodeled and believed the loss was due to disorganization and inventory control issues.”
Subsequent reports of “Theft and Loss” said that 141 1mg lorazepam tablets and 106 5mg diazepam tablets were gone — considerably more than the zeroes originally reported. And inspectors on July 21, 2021 found conditions similar to what they found in several other CVS pharmacies.
“Agents observed medications spilling off the pharmacy shelving in the back of the pharmacy and numerous medication stock bottles stored on the floor of the pharmacy,” the report said. “Additionally, the pharmacy was observed to be dirty.”
Perhaps more concerning were reports the Board of Pharmacy received from the Willoughby CVS last year:
The store reported that on June 9, 2022, it detected the loss of 575 50 mg tablets of the painkiller tramadol.
It reported that on April 12, 2021, it detected the loss of 499 2mg tablets of the sedative alprazolam.
And on Aug. 24, 2021, the store detected the loss of 479 10mg tablets of the sedative-hypnotic zolpidem tartrate, better known as Ambien.
All of the drugs the Willoughby reported lost are Schedule IV controlled substances and pharmacy workers couldn’t find paperwork that is required in response to losses of them. In addition, as was the case in several other harried CVS stores it inspected, the Willoughby store did not have a Responsible Person properly listed with the Board of Pharmacy.
That person, a pharmacist, is legally responsible for the dangerous drugs in the store and when there’s a change in that position, all such drugs are required to be inventoried. However, amid massive staff turnover, the Board of Pharmacy found several instances in which such a person was improperly designated at Ohio CVS stores, or no such person was designated at all.
The board has the power to fine and reprimand pharmacies or revoke their licenses altogether. A hearing into problems found at a CVS store in Canton is scheduled for the board’s Nov. 7-8 meeting. Others are yet to be scheduled.
Asked to comment on problems found at CVS’s Willoughby store, Blanchette, the spokesman, sent a quote almost identical to one the company sent in response to the lengthy list of problems the Board of Pharmacy found in eight other Ohio stores.
“We’re continuing to work with the Board of Pharmacy to resolve allegations of isolated incidents, most of which date back a year or more,” Blanchette said.
As the opioid crisis continues to rage in the United States, publicly traded companies that manufacture, market, or sell the prescription drugs at the center of the epidemic are facing shareholder resolutions for governance reforms and improved disclosure of risks around their involvement in the making or sale of the drugs.
In the process, this effort is turning the spotlight to how major fund companies and other big investors are casting their proxy votes in 2019.
Starting this week and continuing over the next month, shareholders of Johnson & Johnson JNJ [1], Mallinckrodt MNK, and CVS Health CVS will be voting on opioid-related resolutions. They join shareholders of Walgreens Boots Alliance WBA and AmerisourceBergen ABC who have already voted on comparable resolutions in 2019.
In all, since July 2017 (which is considered to be the start of the 2018 proxy season), 19 shareholder resolutions that at least partially relate to the opioid crisis have been placed on the ballots of 10 companies, according to the Morningstar Fund Votes proxy database.
The companies with opioid measures on the docket count as major shareholder firms such as Vanguard, BlackRock, DFA, and OppenheimerFunds. For mainstream mutual fund companies, these votes are a test of their responsiveness to an issue that matters from the standpoints of social impact, corporate governance, and shareholder value via companies’ bottom-line performance.
Of the 19 resolutions, 14 have come to vote to date (24 April), averaging 35% support, a relatively high level of support given that, across the board, management of targeted companies recommended investors vote against the resolutions. And at three companies–Assertio Therapeutics ASRT, Rite Aid RAD, and Walgreens Boots Alliance–support was north of 60%.
Between 1999 and 2017, 400,000 people died from opioid overdose in the US. In 2017 alone, opioid overdoses claimed 47,600 lives, representing another high–around 10% more than in 2016–in the deepening crisis.
The cost to the economy can be measured by its impact on the labor market, healthcare, and justice systems and is estimated to have been more than $500 billion, or 2.8% of gross domestic product, in 2015, according to a 2017 White House Council of Economic Advisers report.
Over 1,500 lawsuits have been brought against large pharmaceutical manufacturers and distributors by individuals, unions, hospitals, Native American tribes, cities, counties, and states. These were recently consolidated into a multidistrict litigation procedure. The suits claim that manufacturers failed to warn of the potential for abuse, given evidence they had of opioids’ highly addictive properties, and that distributors failed to report overprescription of the drugs. In addition, some states are pursuing independent civil lawsuits against specific pharmaceutical distributors for their role in a chain of alleged deception that enabled and fueled overprescription.
The claims run into billions of dollars, which could represent a significant direct investment risk to pharmaceutical company stockholders and, therefore, to mutual fund shareholders.
Many of the resolutions have been organized by Investors for Opioid Accountability, an investor campaign led by the UAW Retirees Medical Benefits Trust and Mercy Investments. The IOA, which was formed in 2017, has 53 investor members with $3.4 trillion in assets under management. Members include asset managers Domini, Hermes, Aegon, Neuberger Berman, Calvert, and NEI Investments as well as unions, public pension funds, and state treasurers’ offices and other organizations. (The full list of members is available here.)
Roughly, opioid-related shareholder resolutions can be sorted into five types, asking that companies:
• disclose governance strategy to address financial and reputational risks of the opioid crisis,
• adopt policy that incentive compensation metrics not exclude legal and compliance costs, or
• disclose incentive pay clawbacks linked to misconduct.
While these measures are considered good general governance practice, in the case of the resolutions identified in the first exhibit, they are explicitly motivated by reference to the legal and regulatory scrutiny of business practices related to opioids, or to the reputational risks from media attention to the company’s lobbying around drug-related legislation or support of lobbying groups.
Two of the most successful resolutions were those at Rite Aid and Walgreens, earning more than 60% support from shareholders notwithstanding recommendations of management in both cases to vote against the resolutions. Both resolutions urge boards to describe the governance changes in place to more effectively monitor the financial and reputational risks related to the opioid crisis, including compensation metrics, stakeholder inputs, and company political activities.
The top three fund company holders of Rite Aid shares are BlackRock, Vanguard, and OppenheimerFunds, and the top three fund company owners of Walgreens are Vanguard, BlackRock, and State Street.
It’s not yet public how U.S. mutual fund companies cast their votes on the more recent resolutions. Funds are only required to disclose their votes annually, and the information for the year ending June 30, 2019, won’t be available until the end of August.
But in the exhibit below, we highlight votes by select fund managers on resolutions that came to vote in the 12 months ended in June 2018. The voting record was mixed in this sample, although in the two resolutions most directly connected to the opioid crisis–at AmerisourceBergen and Assertio Therapeutics, earning 41% and 62% support, respectively–the “for” votes were stronger.
On April 25, shareholders of Johnson & Johnson vote on a motion filed by the New York City comptroller on behalf of city pension funds that asks for disclosure of any senior executive incentive pay clawbacks linked to misconduct, noting Johnson & Johnson’s defendant status in litigation alleging the use of overly aggressive opioid sales tactics.[1]
At Mallinckrodt’s upcoming May shareholder meeting, Mercy Investment Services and co-filers will ask the board to:
“…report to shareholders by December 31, 2019 on the governance measures Mallinckrodt has implemented since 2012 to more effectively monitor and manage financial and reputational risks related to the opioid crisis in the United States (U.S.), given Mallinckrodt’s sale of opioid medications and active pharmaceutical ingredients in opioid medications, including whether Mallinckrodt has assigned responsibility for such monitoring to the Board or one or more Board committees, revised senior executive compensation metrics or policies, adopted or changed mechanisms for obtaining input from stakeholders, or altered policies or processes regarding company lobbying activities.”
Mallinckrodt–maker of generic opioid drug Oxycodone–faces two other opioid-related governance resolutions on its May ballot. The board recommends a “for” vote on the lobbying disclosure resolution, a rarity for the proxy process. In 2017, the company agreed to pay $35 million to settle government allegations that it failed to report suspicious drug orders.
The number of resolutions slated to be voted on doesn’t reflect the full scale of the effort by shareholders. They are also making headway through direct engagement with company managements, according to the 2019 Proxy Preview report published by shareholder advocacy group As You Sow. (The report can be downloaded here.)
Since the start of the 2019 proxy season, in 22 of the cases where IOA coalition investors asked for either a board risk report or misconduct clawback disclosure, the company agreed to the measures without having to go to a vote.
Illinois Treasurer Michael Frerichs, whose office oversees investments totaling around $30 billion, withdrew a 2019 resolution filed at CVS Health asking for disclosure of a broad range of governance responses to opioid-related risks. This followed a successful engagement by the treasurer’s office and IOA members that led to the publication of a stand-alone report on CVS board’s role in overseeing the company’s Opioid Action Plan as well as new web pages describing a companywide strategy in place for addressing prescription abuses. Max Dulberger, director of corporate engagement & investment operations for the treasurer’s office, notes that the Illinois State Treasurer’s Office, as part of IOA’s collective efforts, plans to continue dialogue with this and other investee companies as a fiduciary whose constituents are affected financially and many other ways by this unfolding crisis.
With the proxy process under threat from lobby groups backed by industry trade associations, investors’ use of shareholder resolutions to address the investment risks related to the opioid crisis stands as a reminder of the crucial role of shareholder advocacy and proxy voting in channeling investor market vigilance and providing a framework for constructive dialogue about strategies for addressing investment risks.
[1] JNJ’s resolution was voted on Thursday, 25 April, and on Friday, 26 April, the company posted the results of the vote on its 2019 AGM. Forty-six percent of shareholders supported the shareholder-sponsored request for annual disclosure of whether, and why, incentive compensation was recouped from, or was required to be forfeited by, any senior executive. This raises the average level of support for opioid-related resolutions over the past two seasons to 36% from 35% over 13 resolutions voted so far.
The story Ligation Funding Burford Capital starts at abt TWO MINUTES.
There is no mention of them funding class action lawsuits.
HOWEVER, if one of the major wholesalers or major chain pharmacies are taken to court and the chronic pain pt and/or community prevails. That would suggest that a lot of other class action law firms would be lining up to sue these large healthcare corporations.
According to this article, this “finance” company has a 95% success rate, but of course they are fairly selective in what cases they will finance, and if/when they win.. they want TWICE the money they put out for the lawsuit back, but if the case is a LOSER…the plaintiff owes nothing.
Of course, I am sure that most chronic pain pts would be happy to get little money from a lawsuit, if they could get their pain management therapy back. I suspect that a sizeable award from one of these large healthcare companies, many other law firms that will take a class action law suit on a contingency basis. I would think that to get these large healthcare corporations to redirect their lobbying dollars to lobbying for a change in how DOJ/DEA are going after those in the legal opioid distribution system and let doctors to be more free to prescribe control meds to legit chronic pain pts and other dealing with subjective diseases and in need of controlled meds. Perhaps even taken the production quotas off of the pharmas that produce controlled meds
Obviously, It is going to take one or more in the community to make some phone calls. Apparently Burford Capital is just one of several companies that are in this business of backing lawsuits.
Normally, it only takes 1-2 plaintiffs in a class action case, I am not an attorney, but in this particular case, I think that it would need a plaintiff from every decade of age. To demonstrate to the court that chronic pain, has nothing to do with a certain age. Preteen pts can be dealing with numerous disease issues that generate pain, including terminal cancer among other health issues.
In Louisville,KY there is FOUR MAJOR HOSPITALS in the downtown area within adjacent blocks of one another and there is a Major pediatric PEDIATRIC HOSPITAL affiliated with Kosair charities. I wonder why a 8 y/o was not being treated at that hospital?
8-year-old with failing heart ‘dies in agony’ while in care of Norton Children’s Hospital, lawsuit claims
LOUISVILLE, Ky. (WDRB) — An 8-year-old New Albany boy in need of a heart transplant died in agony with his parents by his side while in the care of Norton Healthcare, a wrongful death lawsuit claims.
While Finnley and his parents, Chris and Sally, waited for another heart transplant, he was kept alive with an artificial heart and other life-sustaining treatment. Despite his medical issues, the only child was known for being a vibrant child with an infectious spirit.
In early April, his parents were told by Norton Healthcare the child was no longer a candidate for another heart transplant and he would be removed from the life-sustaining treatment, a lawsuit claims. The lawsuit states Norton didn’t ask for his parent’s approval or consent on a decision that would end his life.
Finnley was conscious and cognitively aware when the decision to end his life was made, according to the lawsuit. Norton Healthcare officials told his parents they’d never before removed life-sustaining treatment from a conscious and cognitively aware child like Finnley before.
The lawsuit claims Norton Healthcare told the boy’s parents that he wouldn’t experience any fear, anxiety or pain once his life-sustaining treatment was removed. But no physicians were present during the procedure and Finnley was conscious and awake as his life was ending.
The boy cried out for help, but his parents had to falsely assure him that everything would be all right, according to the lawsuit. He died after hours of pain and suffering on April 19.
“He knew what was happening as his life support was shut off, his parents stood bedside and they were helpless to do anything to stop it as he looked at them and said ‘help me,'” said Ann B. Oldfather, the lawyer representing the family.
“It was a disaster,” Oldfather said. “Finnley said ‘what’s happening, why is my monitor off,’ his parents had to say, ‘oh they just lost some power, you are going to be okay.'”
Norton Healthcare called the death of Finnley heartbreaking.
“Norton Children’s Hospital cares for our community’s youngest patients, and we serve all families, including those in very difficult situations,” said Renee Murphy, a spokesperson for Norton Healthcare. “Our clinical teams meet with families regularly to review care plans and medical options, and we work to maintain an open dialogue. Our priority is to provide quality care to all those we serve. Unfortunately, not every medical intervention is successful.”
Another claim in the lawsuit said the McCullums were told the life-sustaining treatment could only be continued with a court order.
“He was not going to spend the last 40 hours he had with his son trying to find an attorney, they begged for extensions,” Oldfather said.
According to the family, Norton engaged in several actions intended to pressure and manipulate them during the process.
“They were at times put against each other,” Oldfather said. “One of the caretakers expressed her opinion that if this had been her child, she would have let him go.”
The McCullums claim they’ve experienced severe physical mental and emotional pain and suffering and loss of enjoyment of life.
“They counted on that when they said goodbye to Finnley, it would be filled with peace and love and joy, and he would be in Sally’s arms as he passed away,” Oldfather said.
This is from the Fox channel in Louisville,KY. Louisville is the largest city in the state of KY and and covers some 8-12 counties in Southern Indiana. I have reached out to the new desk at WDRB and the person I talked to was going to pass my name and phone to the reporter. Click on the hyperlink below to see the 1+ minute piece on the 6PM news cast
LOUISVILLE, Ky. (WDRB) — More than a dozen pharmacies in southern Indiana said this week they aren’t accepting new prescriptions for Oxycodone due to supply issues. Most said they don’t even have enough medication to fill the prescriptions that have already been written, an issue leaving patients scrambling and in pain.
The cause, pharmacists said, is unclear. Some outright said it isn’t a manufacturer issue but rather a problem with “doctors over-prescribing it”. Others said it’s not a shortage of Oxycodone itself, instead blaming the caps put in place to limit how many Oxycodone pills pharmacies can give out due to its addictive nature.
Deborah Wininger, who takes 11 medications per day after breaking her back and suffering disc and nerve damage, is running out of what she desperately needs.
“I can barely walk without pain medication,” Wininger, who lives in southern Indiana, said. “I’ve got a lot of reasons to hurt.”
Shortages of several prescription drugs are growing in the United States, and experts see no clear path to resolving them. For patients, that can mean treatment delays, medication switches and other hassles filling a prescription.
“I was really frustrated,” Wininger said. “This isn’t fair.”
In recent months, unexpected demand spikes, manufacturing problems and tight ingredient supplies have contributed to shortages that stress patients, parents and doctors. For some drugs, such as stimulants that treat ADHD, several factors fueled a shortage and make it hard to predict when it will end.
“I called about every pharmacy in southern Indiana, and nobody had (oxycodone),” Wininger said. “I started getting worried because I thought ‘This is gonna affect a lot of people.'”
Norton Pharmacy said it hasn’t experienced a shortage yet.
Shortages, particularly of generic drugs, have been a longstanding problem. The industry has consolidated and some manufacturers have little incentive to solve shortages because cheap generics generate thin profits.
Factories in China and India supply most of the raw materials used in American medicines. Early in the COVID-19 pandemic, India restricted exports of 13 active pharmaceutical ingredients and finished drugs made from those chemicals, to protect its domestic drug supply.
And during the pandemic, prescriptions climbed as regulators started allowing doctors to prescribe the drug without first seeing a patient in person. For example, prescriptions for Adderall and its generic equivalents jumped 20% between February 2020 and the end of last year, according to IQVIA.
Wininger is still trying to make sure she’s covered, and she fears what’s next.
“If I can’t find it anywhere, I’m going to see withdrawals,” Wininger said. “I’m going to be really sick, and I’m going to be in a lot of pain.”
WASHINGTON (AP) — The U.S. Drug Enforcement Administration’s second-in-command has quietly stepped down amid reporting by The Associated Press that he once consulted for a pharmaceutical distributor sanctioned for a deluge of suspicious painkiller shipments and did similar work for the drugmaker that became the face of the opioid epidemic: Purdue Pharma.
Louis Milione’s four years of consulting for Big Pharma preceded his 2021 return to the DEA to serve as Administrator Anne Milgram’s top deputy, renewing concerns in the agency and beyond about the revolving door between government and industry and its potential impact on the DEA’s mission to police drug companies blamed for tens of thousands of American overdose deaths.
“Working for Purdue Pharma should not help you get a higher job in government,” said Jeff Hauser, the executive director of the Revolving Door Project, a watchdog for corporate influence in the federal government. “Too much collegiality is a problem. It’s hard to view your past and potentially future colleagues as scofflaws. Any independent person would find this abhorrent.”
Milione initially left the DEA in 2017 after a 21-year career that included a two-year stint leading the division that controls the sale of highly addictive narcotics. Like dozens of colleagues in the DEA’s Office of Diversion Control, he went to work as a consultant for some of the same companies he had been tasked with regulating.
New reporting has found that during his time in the private sector, Milione also served as a $600-per-hour expert for Purdue Pharma as it fought legal challenges from Ohio to Oklahoma over its aggressive marketing of OxyContin and other highly addictive painkillers. Milione left the DEA again in late June just four days after AP sought comment from the Justice Department about his prior work for Purdue.
Milione said in a statement this week that he stepped down for personal reasons unrelated to AP’s reporting. Both he and the Justice Department said he recused himself at the DEA from all matters involving his private-sector work where there was even the appearance of a conflict of interest.
Milione added that his consulting stint helped drug companies comply with DEA rules, just as his return to government gave the DEA insight into how business decisions are made in the real world.
“I care deeply about the DEA, its mission and the brave men and women that sacrifice so much to protect the American public,” he said.
But Milione never faced scrutiny from lawmakers over his consulting before taking the DEA’s No. 2 position because the DEA has for more than a decade not filled the job of deputy administrator that requires a presidential appointment and Senate confirmation. Instead, the DEA directly hired Milione to fill a career position with essentially the same duties but a slightly different title – “principal deputy administrator” – that requires no such oversight.
“DEA has demonstrated a willingness to take painstaking measures to avoid the Senate’s watchful eye – including by potentially using a technicality to shirk Senate confirmation of a key agency decision maker,” said U.S. Sen. Chuck Grassley, an Iowa Republican and member of the Senate Judiciary Committee. “Avoiding congressional oversight is a tired game the DEA can’t stop playing. It begs the question: What else is the DEA trying to hide?”
John Coleman, who was head of operations for the DEA in the 1990s, said the Biden administration likely never nominated Milione to serve as deputy administrator, despite his many qualifications, because his conflicts would have surely raised questions.
“Someone at the agency had to be aware of the implications of bringing someone back who was employed in the industry regulated by the agency,” Coleman said. “It was an obvious and classic conflict.”
The DEA didn’t respond to requests for comment. The Justice Department told the AP that Milione disclosed his potential conflicts when he returned to the DEA and that the principal deputy administrator’s position was created before Milgram’s tenure. It said the process for filling the confirmed deputy administrator position is ongoing and referred further questions to the White House, which did not respond to a request for comment.
The DEA made no announcement of Milione’s most recent retirement but removed his bio from the agency’s website over the July 4 holiday and replaced it with that of his successor, career DEA official George Papadopoulos. But in an internal email to staff, Milgram hailed the 60-year-old Milione as a “DEA legend” best known for leading the overseas sting that in 2008 nabbed Russia’s notorious arms trafficker Viktor Bout.
“I was thrilled that he agreed to come back home to DEA,” she wrote in a June 26 email obtained by AP. “Lou has used his skills as a master case maker to help us bring cases against entire criminal networks and to investigate the entire globally fentanyl supply chain.”
Milione’s exit adds to the turmoil at the top of the DEA following a number of other high-level departures, misconduct scandals and the launch of federal watchdog investigation into millions in no-bid contracts awarded to past associates of Milgram.
Mostly Republican members of Congress grilled Milgram during a routine budget request in April, and the administrator also is expected to testify later this month in a House oversight hearing looking into the DEA’s operations and effectiveness combating the flood of fentanyl into the U.S. from Mexico.
Since Milgram took the reins of the DEA two years ago, she has cycled through almost three dozen senior aides, many of them veteran agents who were pushed out or quit due to differences with Milgram. That includes the heads of all of the DEA’s principal divisions as well as the DEA’s chief counsel, its congressional affairs liaison and the top agent in Mexico.
Milgram’s defenders say that house cleaning is part of an agency-wide reset to combat the fentanyl crisis. She’s also exhibited a zero tolerance for racism and sexism that has festered inside the old-boy network that has long shaped personnel decisions inside the DEA.
“Change is hard and some people don’t like it,” Chuck Rosenberg, a former DEA administrator, told AP this spring. “Time will tell whether she was right or wrong, but my money is on Anne.”
Most of Milione’s consulting work was done as a senior managing director of Guidepost Solutions, a private investigative firm based in New York. Under his watch, Guidepost expanded its DEA compliance practice, which now includes nine former DEA employees.
Guidepost declined to comment. Purdue said in a statement that its retention of Milione as an expert on DEA compliance issues ended when the Connecticut-based company filed for bankruptcy protection in September 2019. “To the best of our knowledge, no one at Purdue had any business communications with Mr. Milione after he returned to government,” it said.
For Purdue, which has twice pleaded guilty to federal criminal charges for its role in fueling the opioid crisis and last year reached a $6 billion nationwide settlement aimed at staunching a flood of lawsuits from states, Milione produced a 16-page expert report in 2019 that was never introduced into evidence. That report, obtained by the AP, praises Purdue’s efforts going back to 2000 to track the illegal sale of opioids by rogue pharmacies and “pill mill” doctors.
“These are the kinds of programs DEA encourages and supports manufacturers in undertaking,” Milione wrote, “as it considers them a valuable part of diversion control efforts.”
Former DEA official Coleman questioned why Milgram chose Milione as her No. 2 despite his corporate entanglements and whether it was ever realistic for him to be walled off from many of the position’s leadership functions.
“There’s no way to isolate that person from the day-to-day business of the agency, which includes regulating companies that make and distribute controlled substances,” said Coleman, who is now president of Drug Watch International, a not-for-profit that seeks to reduce drug abuse. “I don’t see how that’s possible.”
This could prove to be interesting. It has been reported that the PBM industry will extract a discount/rebate/kickback of up to 75% of AWP (Average Wholesale Price) to put a pharma med on the PBM’s approved formulary – NO PRIOR AUTHORIZATION NEEDED. I suspect that the price that the FEDS are demanding will not change AWP… and the pharma has an agreement with the PBM industry that the agreed upon rebate/kickback/discount is based on AWP and not the FED’S SO CALLED negotiated price. In the end, the pharma could end up getting less $$$ per bottle than it cost the pharma to make the med.
Johnson & Johnson sues Biden administration over Medicare drug price negotiations
The lawsuit filed in federal district court in New Jersey argues the Medicare negotiations violate the First and Fifth Amendments of the U.S. Constitution.
Earlier suits brought separately by drugmakers Merck and Bristol Myers Squibb, as well as by the U.S. Chamber of Commerce and PhRMA, the pharmaceutical industry’s largest lobbying group, made similar arguments.
J&J’s complaint asks a judge to block the U.S. Health and Human Services Department from compelling the drugmaker to participate in the program.
The company said its suit aims to stop the “innovation-damaging congressional overreach that threatens the United States’ primacy in developing transformative therapies and in patients’ access to those treatments.”
President Joe Biden’s Inflation Reduction Act, which passed in 2022 by a narrow party-line vote, empowered Medicare to negotiate drug prices for the first time in the program’s six-decade history.
The provision aims to make drugs more affordable for older Americans but will likely reduce pharmaceutical industry profits.
The Centers for Medicare and Medicaid Services will publish a list of which drugs were selected for a first cycle of negotiations on Sept. 1, with prices taking effect in 2026. The companies that make those drugs face an October deadline to sign agreements to participate in those negotiations.
J&J said its patented drug Xarelto, which treats blood clots and reduces the risk of stroke, will be subject to price negotiations in 2023 because it is among the 10 most widely reimbursed drugs for Medicare Part D patients.
J&J argues that Medicare negotiations “inflict an uncompensated physical taking” of the company’s drug and essentially force J&J to provide access to Xarelto on terms set by the government that the company “would never voluntarily” agree to.
The company claims this violates Fifth Amendment protections against the government seizing private property without just compensation.
J&J last year booked $2.47 billion in revenue from Xarelto.
J&J also argues that the new provision forces the company to agree that the federal government is negotiating fair drug prices. That compels J&J to make “false and misleading statements” in violation of the First Amendment, according to the complaint.
The company believes the provision doesn’t involve true negotiations since the government “unilaterally dictates” drug prices.
Real negotiation involves finding a way for both parties to freely agree on terms, J&J said.
“While the Government may choose to deceptively describe the Program as involving an ‘agreement’ to ‘negotiate’ a ‘fair’ price, it cannot force manufacturers to echo its misleading messaging,” J&J said in the complaint.
HHS said in a statement it will “vigorously defend the President’s drug price negotiation law, which is already helping to lower health care costs for seniors and people with disabilities.”
“The law is on our side,” the agency added, reiterating previous remarks made by HHS Secretary Xavier Becerra.
My, how times have changed at the “Pharmacy America Trusts” ? Walgreen states that they are “invested in your safety and wellness”, but we are refusing to fill the controlled meds that your prescriber has deemed are medically necessary for treating your specific health issues. This IN NO WAY IMPACTS YOUR RELATIONSHIP WITH WALGREENS and WE APOLOGIZE FOR ANY INCONVENIENCE. On Walgreens you can find any medicine you need like for example if you are having prostate problems and you are looking for a medicine like prostadine you can go there and I’m pretty sure you will find them.
So one of the basic functions of the practice of medicine is the starting, changing, stopping a pt’s therapy. So if this pt can’t find another pharmacy to fill her controlled med Rxs… could Walgreen be considered the genesis of this pt’s medications being stopped ? They clearly state in the letter that the pharmacists at her local Walgreens had no involvement with this decision, which would imply that it was done by someone or some computeralgorithm at Walgreen’s corporate HQ. NOTHING PERSONAL !
Cigna owns the PBM Express Scripts – according to this article https://www.drugchannels.net/2022/04/the-top-pharmacy-benefit-managers-of.html Express Script is the SECOND LARGEST PBM, HOWEVER, recent announced merger between Humana & United Health, suggests that merger will push Express Script down to THIRD PLACE.
