Cardinal Health Settles, Novartis Settles

And the march of settlements continues....

As reported by the Tulsa (Oklahoma) World,

A company that provides hospital pharmacy management services in Tulsa has agreed to pay $1 million in civil penalties for failing to account for large amounts of missing prescription drugs, the U.S. Attorney's Office in Tulsa announced Friday.

Cardinal Health Pharmacy Services agreed to settle allegations with the federal prosecutors' office, which alleged that the company's two Tulsa pharmacies were negligent and violated several provisions of the Controlled Substances Act.

An audit showed that nearly 400,000 dosage units of hydrocodone, a painkiller, and 234,000 units of alprazolam, an anti-anxiety drug, were unaccounted for at the Hillcrest Medical Center pharmacy from October 2005 through June 2007, according to a news release.

The investigation also revealed that more than 30,000 doses of drugs at the Oklahoma State University Medical Center pharmacy were unaccounted for between April 2007 and July 2008.

Meanwhile, as reported by Associated Press (via Nj.com),

Federal prosecutors say a Princeton-based pharmaceutical company has agreed to pay $3.5 million to settle allegations that it claimed its heart drug was eligible for Medicaid reimbursement.

The U.S. attorney's office in Boston said Monday that Eon Labs Inc., a subsidiary of Swiss company Novartis AG, submitted false reports to the government between April 1999 and September 2008 that misrepresented Nitroglycerin SR's regulatory status and failed to advise that the drug did not qualify for Medicaid coverage.

Prosecutors say Eon Labs did so even after the Food and Drug Administration determined that there was a lack of evidence that Nitroglycerin SR was effective.

Note that we most recently discussed a settlement by Novartis last month (January, 2010). 

The march of settlements continues. To repeat, seemingly ad infinitum, these are just the latest in a now long parade of settlements that serve as reminders of poor behavior by myriad health care organizations. As we have previously noted, these settlements seem to have little deterrent effect on future bad behavior. (Note that many large health care organizations have settled or plead guilty in several major cases since we started commenting on such settlements.)  Usually, the companies involved only need to pay fines, and no individual who performed, directed or approved unethical or illegal acts will suffer any negative consequences. I submit once again that such fines are viewed merely as costs of doing business by the affected companies, and do not deter future bad behavior. Until the people who approve, direct, and perform unethical or illegal acts pay some penalties, expect such acts to continue. I again suggest that to truly reform health care, we need rigorous regulation of health care organizations that has the power to deter unethical behavior that may risk patients' health.