Sherry Lenoxs husband died hours after taking an anemia drug , although… (Bill O'Leary/WASHINGTON…)
On the day Jim Lenox got his last injection, the frail 54-year-old cancer patient was waiting to be discharged from the Baltimore Washington Medical Center. He’d put on his black leather coat. Then a nurse said he needed another dose of anemia drugs.
His wife, Sherry, thought that seemed odd, because his blood readings had been close to normal, but Lenox trusted the doctors. After the nurse pumped the drug into his left shoulder, the former repairman for Washington Gas said he felt good enough to play basketball.
The shots, which his cancer clinic had been billing at $2,500 a pop, were expensive.
Hours later, Lenox was dead.
For years, a trio of anemia drugs known as Epogen, Procrit and Aranesp ranked among the best-selling prescription drugs in the United States, generating more than $8 billion a year for two companies, Amgen and Johnson & Johnson. Even compared with other pharmaceutical successes, they were superstars. For several years, Epogen ranked as the single costliest medicine under Medicare: U.S. taxpayers put up as much as $3 billion a year for the drugs.
The trouble, as a growing body of research has shown, is that for about two decades, the benefits of the drug — including “life satisfaction and happiness” according to the FDA-approved label — were wildly overstated, and potentially lethal side effects, such as cancer and strokes, were overlooked.
Last year, Medicare researchers issued an 84-page study declaring that among most kidney patients, the original and largest market for the drugs, there was no solid evidence that they made people feel better, improved their survival or had any “clinical benefit” besides elevating a statistic for red blood cell count.
It was a remarkable finding of futility: While drugmakers had seen billions in profits over 22 years, much of it from taxpayers, millions of patients had been subjected to dangerous doses that might have had little advantage.
How did this happen?
To answer the question, The Washington Post obtained the agreements between the drugmakers and the Food and Drug Administration, reviewed thousands of pages of transcripts and company reports, and relied on new academic research, some by doctors who once administered the drugs but now look askance at the drugmakers’ original claims.
The multibillion-dollar rise and fall of the anemia drugs illustrates how the economic incentives embedded in the U.S. health-care system can make it not only inefficient but also potentially deadly.
Through a well-funded research and lobbying campaign, Amgen won far-reaching approvals from the FDA. Both pharmaceutical companies conducted trials that missed the dangers and touted benefits that years later would be deemed unproven. The companies took more than a decade to fulfill their research commitments. And when bureaucrats tried to rein in the largest doses, a high-powered lobbying effort occurred until Congress forced the regulators to let the drugs flow.
But at the center of any explanation of the popularity of these drugs are the nation’s doctors, clinics and hospitals, and the choices they made for patients.
Americans might like to think that doctors focus on only their health. But physicians and hospitals have to pay the bills, too, and, in some cases, the more they treat a patient, the more they earn. This was especially true in the case of the anemia drugs: The bigger the dose, the more they made.
Unlike medications that a patient picks up at the store, drugs administered by a physician, as these were, can yield a profit for doctors if there is a “spread” — a difference between the price they pay for the drug and the price they charge patients.
In this case, drugmakers worked diligently to make sure that doctors had an incentive to give large doses — that the spread was large. They offered discounts to practices that dispensed the drug in big volumes. They overfilled vials, adding as much as 25 percent extra, allowing doctors to further widen profit margins. Most critical, however, was the company’s lobbying pressure, under which Congress and Medicare bureaucrats forged a system in which doctors and hospitals would be reimbursed more for the drug than they were paying for it.
The markup that doctors, clinics and hospitals received on the drugs given to Medicare patients reached as high as 30 percent, according to the Medicare Payment Advisory Commission, a group that advises Congress. And the markup on doses given to patients covered by private insurance was even larger.
The incentives worked.
At the peak of the boom in 2007, more than 80 percent of 175,000 dialysis patients on Medicare were receiving the drug at levels beyond what the FDA now considers safe, according to federal statistics. Although other patients were receiving the drugs, the United States keeps closer records on dialysis patients.