“Firm paid for Caribbean and ski junkets for doctors”
By Nick Webb
Sunday March 06 2011 The Sunday Independent
IRISH pharma giant Elan advised doctors to give an unauthorised drug to young children by mixing it in “apple sauce”, according to documents obtained by the Sunday Independent.
Last Monday, the €3bn-valued Athlone-headquartered company agreed to pay the biggest fine in Irish corporate history, when it coughed up almost €147m as part of an agreement to resolve US criminal and civil investigations into the illegal marketing of an epilepsy drug.
“One particular medical letter used by sales representatives with paediatricians described how to administer Zonegran to a child by putting the contents of a Zonegran capsule into apple sauce,” according to the complaint.
“No mention was made of the fact that the FDA (Federal Drug Administration) had specifically not approved Zonegran for use in children due to the severe potential side effects…”
The case also revealed highly controversial methods used by drug companies to persuade doctors to prescribe their highly profitable products. Potential “high prescriber” doctors were invited on “expense-paid trips” to the Caribbean or ski resorts for “so-called” advisory board meetings to hear speeches on health issues. These junkets took place in Bermuda and Key Largo in Florida, as well as the exclusive Vail ski resort in Colorado and Tucson, Arizona, according to the allegations. Elan also sponsored presentations and articles about using Zonegran for unapproved purposes.
“Since the alleged actions occurred over six years ago, Elan has implemented a broad corporate compliance programme which follows guidance from global government authorities and is applicable to all aspects of the business,” a spokesman said.
In 2000, Elan’s drug Zonegran was approved by US authorities to treat patients over 16 years of age. It was the last of three new drugs brought on to the market by big pharma companies that year. It “faced a steep uphill battle to obtain sales”, according to the filings. Two years later, Elan “came under significant financial pressure” because of an investigation into its financial practices by the US Securities and Exchange Commission. It undertook a review of its drug portfolio to decide which ones it would keep and which it could sell to raise cash.
“As part of that evaluation, Elan conducted market research and decided to retain Zonegran because of its large potential for growth, especially in unapproved uses,” according to the US Justice Department. Elan promoted Zonegran to treat underage children suffering from mood swings, migraines and weight problems. This was hugely profitable for the drug company, with sales of the drug increasing dramatically.
The settlement is enormously embarrassing for some of the biggest names in the Irish business world as some of the best known corporate grandees served on the board over the period. These include former IDA Ireland boss Kieran McGowan, who is chairman of Ireland’s biggest company, CRH. He joined the board in 1998. Tom Lynch, who served as the drug company’s finance chief, has also been a board member of the IDA. Kyran McLaughlin is one of the joint heads of Davy stockbrokers, while Alan Gillespie served as chairman of Ulster Bank until 2008.
“Elan divested Zonegran in April 2004 and the activity under investigation dated originally to 2000, a time period which was prior to the majority of current management or directors respectively joining the company or the board,” according to a spokesman for Elan.
– Nick Webb