LaQuenta Caldwell-Moody considered it improper when a pharmacy sales representative tried to take her teenage son, when he was still a minor, to dinner without her.
The salesman was the father of someone with hemophilia, the same disease her son has. But this invitation seemed mercenary, taking advantage of their friendship and shared illness to try to woo the business of her son, Austin Caldwell, whose drug treatments cost more than $1 million a year.
“He’s a cash cow,” said Caldwell-Moody, who lives in Concord, North Carolina. “He’s wanted by a lot of people.”
Drugs for hemophilia are so expensive and therefore so lucrative for the pharmaceutical industry that they’ve created an unusual conflict of interest, blurring the lines between being a patient and drug seller. Increasingly, manufacturers of hemophilia drugs and the specialty pharmacies that dispense the medicines are hiring patients and their relatives to gain an inside track and access in selling their products.
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“There are a lot more patients that work in industry now than ever before,” said Michelle Rice, vice president for public policy and stakeholder relations at the National Hemophilia Foundation.
The companies, and some patients, say the practice can improve service, because no one understands the special needs of hemophiliacs more than someone with the disease.
But some patient advocates say that having people with dual, and sometimes dueling roles, can result in patients being misled by someone they think of as their friend but who puts profits over their health. The owners of a specialty pharmacy in Alabama were convicted of inflating bills to Medicaid by paying huge commissions to some members of the hemophilia community to recruit patients.
“I think it’s a shame that with so much money comes a lot of ugliness,” said Charlene Cowell, executive director of Hemophilia of North Carolina, an advocacy group. “A few people have let the revenues and the benefits of the money just outweigh their love for this community.”
Caldwell-Moody, whose son is now 18, said she had stopped attending meetings of Hemophilia of North Carolina to avoid the sales pitches. Some local support groups are establishing rules to identify attendees of events as patients or sales representatives.
The phenomenon of patients working for the industry is not unique to hemophilia, but is much more common, according to various patient advocates. This could be because of fierce competition among specialty pharmacies and the lingering distrust of drug companies among some people with hemophilia because many of them were infected decades ago with HIV or hepatitis from drugs made from contaminated blood plasma.
In the Alabama case, the owners of the specialty pharmacy MedfusionRx were convicted after prosecutors charged that they hired a man with hemophilia to get him and his relatives with the disease as customers.
The man who pleaded guilty was paid several hundred thousand dollars a year, but did little work, according to court documents. He paid the rents, phone and power bills of his small client base and spent many workdays in a casino.
Also convicted was the mother of a young man with hemophilia, who was paid 45 percent of the profit MedfusionRx made from each customer she recruited. Prosecutors said she encouraged patients to order more of the drugs than they needed. They also said her son switched to a more expensive drug so she could earn $20,000, which allowed her husband to buy a pickup truck.
Insurance companies and pharmacy benefit managers are increasingly dictating which specialty pharmacy is used – often one that they themselves own – making it harder for patients to choose one that employs their friend or relative.
High costs, profits
About 20,000 Americans, overwhelmingly males, have hemophilia, an inherited disease marked by a deficiency of a protein needed for blood to clot. To prevent or stanch bleeding, which could otherwise be life-threatening, hemophiliacs infuse themselves with the missing protein, known as a clotting factor.
The drugs cost from $30,000 to a few hundred thousand dollars a year per patient. Costs can be much higher, even over $1 million, for patients whose bodies produce “inhibitors” – antibodies that render the clotting factor less effective, or those with other diseases that can cause bleeding.
The global market for hemophilia drugs is now worth about $10 billion a year, according to Ronny Gal, an analyst at Sanford C. Bernstein & Co. The biggest supplier is Baxalta, which was recently spun off from Baxter and agreed this week to be bought by Shire. Other big companies include Bayer, CSL, Pfizer and Novo Nordisk.
The attractiveness of the market is spurring new drug development. Biogen, a newcomer, entered the market with clotting factors that require less frequent infusions. Roche is developing a drug to help overcome inhibitors. Several companies are making progress on gene therapy, which could conceivably cure the disease.
Pharmacies that specialize in hemophilia drugs, like BioRx and Factor Support Network, are being snapped up by larger pharmacies.
Some say that the “hemocaust,” when many hemophiliacs died from HIV or hepatitis from tainted clotting factors, still influences the community. Lawsuits accused the drug companies of not acting quickly enough to address the problem. Some patient activists broke away from the National Hemophilia Foundation, which they accused of being too close to industry.
“This is a very tight community,” said Vaughn Ripley, who got both HIV and hepatitis C. “We faced death together.”
That’s one reason companies want to employ patients. “To have trust in the community you almost have to have someone in the community,” said Jeff Werneke, CEO of BioEthics Advantage, a specialty pharmacy.
Some specialty pharmacies, like Brothers Specialty Rx in Riverside, California, were started by people with the disease. “We custom-tailored our business around how we wanted to be treated ourselves,” said Scott Carthey, a co-founder.
Drug makers join in
While most of the hiring of community members is by pharmacies, manufacturers like Biogen have also done so.
“I’m a part of this community,” said Nikita Lyons Murry, a Biogen community relations employee as she emceed a dinner hosted by the company for patients and family members at the annual meeting of the hemophilia foundation in Grapevine, Texas, in August.
In the past, drug companies and pharmacies routinely took patients to dinner and provided presents like sleeping bags to children at hemophilia summer camps.
“It was like Christmas in July for these kids,” said Rice of the hemophilia foundation, who has two sons with the disease.
Now activities are more restricted, owing to drug industry ethics guidelines and concern among patient groups. Some camps no longer employ people from industry. A session on ethics at the foundation meeting was called “Go to dinner, go to jail.”
Patients who work for the industry say the situation is not always comfortable for them either. “People look at you very differently,” said Benjamin Martin. “They suddenly are wary of you.”
Martin, a former journalist, is a client relations executive at the specialty pharmacy owned by CVS Health. Three or four of his friends with the disease became CVS customers.
Martin also began running a nonprofit organization that arranges whitewater rafting trips for hemophiliacs. One pharmacy he solicited for a donation initially refused, complaining that some participants on a previous trip worked for a rival pharmacy and used the time on the river to poach customers. Martin said that rafters now have to leave their industry hats at home.
“People have trouble drawing the line between being a patient and being a salesperson,” he said.