Abraxis BioScience, AstraZeneca & Abraxane

In a February 2007 press release, Abraxis BioScience reported record revenue of $765 million in 2006 versus $521 million for 2005. They made that money selling a new version of an old cancer drug at $4,200 per dose.

That new drug is called Abraxane and it has pushed Abraxis BioScience stock from $5 in 2002 to $27 in 2007. The lofty stock price has made Abraxis CEO and Chairman, Dr. Patrick Soon-Shiong a billionaire; Dr. Soon-Shiong owns 84 percent of the stock, today worth about $3.8 billion.

Dr. Patrick Soon-Shiong has been criticized for hyping his research results and he has been accused of ripping off investors. Even his own brother, an early backer, sued him for fraud and fired him—twice—from the company they started. Their fight lasted two years and destroyed their relationship. But in the end, it is Dr. Soon-Shiong who has prevailed.

Today, Dr. Soon-Shiong is making money hand over fist. After all, his “new” drug costs 25 times more than an older, generic version (paclitaxel). There is, however, little difference between the new drug and older therapy; in fact, they both use the same active molecule. The only difference is that in Abraxane paclitaxel is bound to a protein, to make it easier to inject. And Abraxane doesn’t help patients live longer than the old, generic, version of the drug.

It is also noteworthy that an independent review article of Abraxane and similar drugs in “Annals of Oncology” concluded, “do these agents represent anything more than old wine in a new bottle? With currently available data, we have to say, ‘not really’.”

So how has Abraxis BioScience been able to sell so much of a drug that isn’t really much better than the old version and how has Dr. Patrick Soon-Shiong been able to get so rich?

Some AstraZeneca oncology sales reps think they have part of the answer. They claim that those rapidly escalating sales may have been built upon off-label marketing.

AstraZeneca co-promotes Abraxane with Abraxis BioScience, and those sales representatives claim that at a joint sales meeting between AstraZeneca and Abraxis, which took place in December 2006 in Pittsburg, things went awfully wrong.

The meeting was led by AstraZeneca Regional Sales Director Mike Zubillaga, who has since been terminated by AstraZeneca, together with an Abraxis Medical Science Liaison (MSL) and two District Sales Managers; one from Abraxis and one from AstraZeneca.

Eight AstraZeneca oncology sales reps and eight Abraxis reps participated in the training, and they received the assistance of a whopping seven oncologists, who made some extra cash, tutoring the sixteen sales reps.

According to some of those AstraZeneca sales reps, the Abraxis Medical Science Liaison made it known that the Abraxis MSLs were available for off-label discussions (such as lung cancer) with oncology doctors, and that the AstraZeneca reps should use them as a resource. Then the Abraxis District Sales Manager allegedly pointed out that coordination of these meetings should be done by cell phone only, and that email or voicemail should be avoided.

If these allegations are true, this all sounds very familiar.

In May 2004, Pfizer’s subsidiary Warner-Lambert paid a $430 million fine for off-label promotion of Neurontin. The Department of Justice stated that Warner-Lambert “utilized "Medical Liaisons," who represented themselves (often falsely) as scientific experts in a particular disease, to promote off-label uses for Neurontin.”

And the sales efforts for Abraxane are clearly paying off. Over 20,000 people have been treated with Abraxane, and sales are expected to reach $1 billion by 2010.

But that may not be how things play out.

Because those concerned AstraZeneca sales reps who participated in the meeting with Abraxis BioScience didn’t stay silent. They claim a “Code of Conduct report was submitted through the AstraZeneca hotline shortly thereafter.” They also told me that, “thus far we are not aware of any investigation or interviews by AZ. No official response from them as of today.”

So when AstraZeneca took no visible action, and did not respond, the AstraZeneca oncology sales reps decided to talk to me. And that’s the reason you’re reading this story today.

UPDATE: AstraZeneca has now responded to the sales reps. Five months after the first report was made, they finally left a message on the hotline for their internal whistleblowers, AFTER the story was leaked to the press.

ENDS

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