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Lawsuits, Drug Study Make for Bad Weeks for Amgen

Over the past few weeks biotech giant Amgen has been hit with delays for getting a potentially blockbuster drug to market; 15 states filed a federal lawsuit against the company; and a new study shows its anemia drug, Aranesp, may be causing more harm than good for some patients. The first hit for the compamy was the FDA extending its review period for approving the company’s experimental osteoporosis drug denosumab. The regulatory agency requested more information about how Amgen plans to monitor patients using denosumab, more information on the company’s Risk Evaluation and Mitigation Strategy, and updated safety data related to the drug. The FDA and Amgen did not provide a timeline for when the issues will be resolved. Analysts estimate worldwide revenues for the drug could hit $2.5 billion by 2013. This comes at a time when domestic and international sales of Amgen’s blockbuster anemia drug, Aranesp, continue to decline, and the company is experiencing increased competition for its rheumatoid arthritis drug, Enbrel. On October 30th, New York Attorney General, Andrew M. Cuomo, and 14 other states including California, filed a federal lawsuit against Amgen, International Nephrology Network, a specialty group purchasing organization, and wholesaler ASD Healthcare. The suit followed an investigation spearheaded by Cuomo’s office into what it said is a nationwide kickback scheme to boost drug sales, according to a press release issued by Cuomo’s office. According to the multi-state complaint, the companies would encourage medical providers to bill third-party payers such as Medicaid for otherwise free doses of Amgen’s anemia drug Aranesp. The suit further alleges Amgen conspired with the other companies to offer illegal kickbacks to medical providers, such as sham consultancy agreements, weekend retreats or other services to induce them to purchase and prescribe Aranesp. As a result of these illegal inducements, the complaint asserts the companies caused medical providers to falsely certify to state Medicaid programs that the providers were in compliance with federal and state anti-kickback statutes, which prohibit bribes to medical providers. The companies are said to have caused millions of dollars in damages to Medicaid. “Drugs should be prescribed to patients on the basis of need, effectiveness, and safety, not on corporate giant’s promise of an all expense paid vacation,” said Cuomo. “In an egregious violation of the law, Amgen allegedly bribed medical providers and left taxpayers footing the bill for free samples.” And to top things off, the New England Journal of Medicine published the results of a study known as “The Trial to Reduce Cardiovascular Events with Aranesp Therapy” (TREAT). TREAT was a large randomized, double-blind, placebo controlled, Phase III pivotal study of patients with chronic kidney disease who are not on dialysis, those with moderate anemia, and those with type-2 diabetes. The purpose was to determine whether the treatment of anemia with erythropoiesis-stimulating agents (ESAs) such as Aranesp would reduce the risk of death, major cardiovascular events, and renal events. The results showed no difference between the control and placebo groups in the overall rates of death, a cardiovascular event, or end-stage renal disease. And of the patients assigned to Aranesp, 101 of them had a stroke, compared with 53 patients assigned to placebo. The risk of stroke observed in the TREAT study was higher than previous studies. “ESAs were originally approved to raise red blood cell levels and to reduce the need for transfusions,” said Dr. Roger M. Perlmutter of Amgen. “In the TREAT study, we sought to demonstrate that, beyond these benefits, ESA therapy reduces cardiovascular morbidity and mortality. This hypothesis is not supported by the data.” Amgen officials said they shared this information with global regulatory authorities and anticipate that the TREAT results will be included in labeling once discussions are complete. “The results of the TREAT will influence practice guidelines and inform physicians, patients, and policymakers,” said Dr. Philip A. Marsden, author of the New England Journal of Medicine article. “In many of these stakeholders, the risk of stroke will outweigh the potential benefits of darbepoetin alfa. However, naysayers will not agree.” Amgen has experienced numerous problems related to Aranesp. In August 2007, the company laid off more than 2,000 employees, largely because of decreased revenue from the drug. The move followed the FDA issuing a safety alert related to the drug at the beginning of 2007. Aranesp sales continue to decline in the U.S. and internationally. Amgen’s price per share crept up from $58.31 on October 5, to $61.83 per share on October 15. Then it began a sharp decline. At market close on Nov. 4, the price per share was $52.12.

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