US Kids Represent Psychiatric Drug Goldmine

Prescriptions for psychiatric drugs increased 50 percent with children in the US, and 73 percent among adults, from 1996 to 2006, according to a study in the May/June 2009 issue of the journal Health Affairs. Another study in the same issue of Health Affairs found spending for mental health care grew more than 30 percent over the same ten-year period, with almost all of the increase due to psychiatric drug costs.

On April 22, 2009, the US Agency for Healthcare Research and Quality reported that in 2006 more money was spent on treating mental disorders in children aged 0 to 17 than for any other medical condition, with a total of $8.9 billion. By comparison, the cost of treating trauma-related disorders, including fractures, sprains, burns, and other physical injuries, was only $6.1 billion.

In 2008, psychiatric drug makers had overall sales in the US of $14.6 billion from antipsychotics, $9.6 billion off antidepressants, $11.3 billion from antiseizure drugs and $4.8 billion in sales of ADHD drugs, for a grand total of $40.3 billion.

The path to child drugging in the US started with providing adolescents with stimulants for ADHD in the early 80s. That was followed by Prozac in the late 80s, and in the mid-90s drug companies started claiming that ADHD kids really had bipolar disorder, coinciding with the marketing of epilepsy drugs as "mood stablizers" and the arrival of the new atypical antipsychotics.

Parents can now have their kids declared disabled due to mental illness and receive Social Security disability payments and free medical care, and schools can get more money for disabled kids. The bounty for the prescribing doctors and pharmacies is enormous and the CEOs of the drug companies are laughing all the way into early retirement.

Psychiatric Drugs Explained

During an interview with Street Spirit in August 2005, investigative journalist and author of "Mad in America," Robert Whitaker, described the dangers of psychiatric drugs. "When you look at the research literature, you find a clear pattern of outcomes with all these drugs," he said, "you see it with the antipsychotics, the antidepressants, the anti-anxiety drugs and the stimulants like Ritalin used to treat ADHD."

"All these drugs may curb a target symptom slightly more effectively than a placebo does for a short period of time, say six weeks," Whitaker said. However, what "you find with every class of these psychiatric drugs is a worsening of the target symptom of depression or psychosis or anxiety, over the long term, compared to placebo-treated patients."

"So even on the target symptoms, there's greater chronicity and greater severity of symptoms," he reports, "And you see a fairly significant percentage of patients where new and more severe psychiatric symptoms are triggered by the drug itself."

Whitaker told Street Spirit that the rate of Americans disabled by mental illness has skyrocketed since Prozac came on the market in 1987, and reports: (1) the number of mentally disabled people in the US has been increasing at a rate of 150,000 people per year since 1987, (2) that represents an increase of 410 new people per day and (3) the disability rate has continued to increase and one in every 50 Americans is disabled by mental illness.

The statistics above beg the question of how could this happen when the so-called new generation of "wonder drugs" arrived on the market during the exact same time period. The truth is, the "wonder drugs" cause most of the bizarre behaviors listed by doctors to warrant a mental illness disability.

Psychiatric Drug Goldmine

The CIA "World Factbook" estimate the world population to be about 6.8 billion and the US population to be a mere 307 million. In an April 2008 report, the market research firm Datamonitor reported that the "US dominates the ADHD market with a 94 percent market share."

ADHD drug prices at a middle dose for 90 pills at DrugStore.com, are: Adderall $278, Concerta $412, Desoxyn $366, Strattera $464 and Vyvanse $385. Daytrana costs $437 for three boxes of 30 nine-hour patches.

The SSRI and SNRI antidepressants include GlaxoSmithKline's Paxil and Wellbutrin, Pfizer's Zoloft, Celexa and Lexapro from Forest Labs, Luvox by Solvay, Wyeth's Effexor and Pristiq and Lilly's Prozac and Cymbalta. The average price of these drugs is about $300 for 90 pills at DrugStore.com.

The prices for anticonvulsants can run as high as $929 for 180 tablets of Glaxo's Lamictal, and $1170 for 180 tablets of Johnson & Johnson's Topamax.

In 2008, the atypical antipsychotics took over the slot as the top revenue earners in the US, and include Seroquel by AstraZeneca; Risperdal and Invega marketed by Janssen, a division of J&J; Geodon by Pfizer; Abilify from Bristol-Myers Squibb; Novartis' Clozaril and Eli Lilly's Zyprexa. The average price on these drugs for 100 pills at DrugStore.com is about $1,000. Lilly also sells Symbyax, a drug with Zyprexa and Prozac combined, at a cost $1,564 for 90 capsules at DrugStore.com in May 2009.

The briefing material submitted to an FDA advisory panel in April 2009 reported that an estimated 25.9 million patients worldwide had been exposed to Seroquel since its launch in 1997 through July 31, 2007, in the US, and the second quarter of 2007 for countries outside the US. Of that number, an estimated nearly 15.9 million took Seroquel in the US, compared to only ten million patients in the rest of the world. In 2008, the US accounted for roughly $3 billion of Seroquel's $4.5 billion in worldwide sales.

For the full-year of 2008, Eli Lilly reported worldwide Zyprexa sales of about $4.7 billion, with US sales of $2.2 billion and only $2.5 billion for the rest of the world.

FDA as Promotional Tool

On June 12, 2009, an FDA advisory panel gave the green light to expand the marketing of Zyprexa, Seroquel and Geodon for use with 13 to 17 year-olds diagnosed with schizophrenia and 10 to 17 year-olds diagnosed with bipolar disorder. The FDA usually follows its advisers' recommendations.

"Such approval gives manufacturers a shield from liability - for illegally promoting the drugs for off-label use," said Vera Hassner Sharav, president of the Alliance for Human Research Protection.

"And such approval ensures increased use of these drugs," she warned. "Manufacturers and mental health providers will profit while children's physical and mental health will be sacrificed."

"The body of evidence showing these drugs to be harmful is irrefutable," she said, "it is documented in FDA's postmarketing database, and in secret internal company documents uncovered during litigation."

According to Dr. Stefan Kruszewski, a Harvard-trained psychiatrist from Harrisburg, Pennsylvania, the atypicals increase the risk of obesity, type II diabetes, hypertension, heart attacks and stroke.

He said the drugs were marketed as safer and easier to tolerate than the older, cheaper antipsychotics because they would cause fewer neurological injuries like tardive dyskinesia and akathisia.

Those claims turned out to be totally false, he said, and "they continue to cause same neurological side-effects as the older antipsychotics."

"Children are known to be compliant patients and that makes them a highly desirable market for drugs, especially when it pertains to large-profit-margin psychiatric drugs, which can be wrought with issues of non-compliance because of their horrendous side effect profiles," according to a June 29, 2009 paper titled, "Drugging Our Children to Death," in Health News Digest.com, by Gwen Olsen, who spent over a decade as a pharmaceutical sales rep, and authored the book, "Confessions of an Rx Drug Pusher."

Children are forced to take their drugs by doctors, parents and school personnel, she said. "So, children are the ideal patient-type because they represent refilled prescription compliance and 'longevity.'"

"In other words," Olsen noted, "they will be lifelong patients and repeat customers for Pharma!"

"The initiative to drug our children for profit has exceeded all common sense boundaries and is threatening the welfare of every American child," she stated, and it "is up to each and every one of us to stop this madness!"

Drug Makers Busted

Most all of the psychiatric drug companies have come under investigation over the past several years for promoting their drugs for off-label use, especially with children. However, the fines they end up paying are trivial compared to the profits earned through the illegal marketing campaigns.

In September 2007, Bristol-Myers Squibb entered into a $515 million civil settlement with the US Department of Justice for illegally marketing drugs, including Abilify, for off-label uses. In the first six months of 2009, Abilify had sales of $1.9 billion. In 2008, the salary and compensation package of Bristol-Myers' CEO, James Cornelius, was $23,150,236, according to the AFL-CIO's Executive PayWatch Database.

On January 29, 2009, Paxil and Wellbutrin maker, GlaxoSmithKline, announced that it would record a legal charge in the fourth quarter of 2008 of $400 million relating to an ongoing investigation initiated by the US attorney's office in Colorado into the US marketing and promotional practices for several products for the period 1997 to 2004. The government inquired about alleged off-label marketing as well as medical education programs for doctors, "other speaker events, special issue boards, advisory boards, speaker training programmes, clinical studies, and related grants, fees, travel and entertainment," according to a Glaxo annual report.

In January 2009, Eli Lilly settled with the DOJ and more than 30 states for $1.4 billion over the off-label marketing of Zyprexa. The agreement included a $615 million fine for a federal criminal charge. But $1.4 billion was chump change considering that Zyprexa was still Lilly's best seller in 2008, with sales of $4.69 billion. Lilly also has paid over $1 billion to settle lawsuits filed by Zyprexa patients. In the first six months of 2009, Zyprexa sales were $1.5 billion. In 2008, Lilly's CEO, John Lechleiter, had a pay package worth $12,856,882

In September 2009, the DOJ reached a $2.3 billion settlement with Pfizer related to the off-label promotion of several drugs, including the psychiatric drugs, Geodon, Zoloft and Lyrica, in the largest health-care fraud settlement in history. But even though Pfizer took the entire $2.3 billion as an earnings charge for the fourth quarter of 2008, the drug maker was still able to post a fourth quarter profit of $268 million. Pfizer's CEO in 2008, Jeffrey Kindler, had a salary and pay package of $15,547,600.

Johnson & Johnson is also dealing with the DOJ and state-level investigations into the off-label marketing of Risperdal. The company's latest SEC filing lists nine subpoenas received by the company involving promotions of Risperdal, including one "seeking information regarding the Company's financial relationship with several psychiatrists." In the first six months of 2009, Risperdal earned $660 million. J&J's CEO, William Weldon, had a pay package worth $29,127,432 in 2008.

AstraZeneca's third quarter SEC filing lists a $520 million tentative settlement agreement with the US attorney's office in Philadelphia to resolve allegations related to the off-label marketing of Seroquel. At "least 34 states are pursuing separate investigations of AstraZeneca's marketing practices as part of a joint investigation and others may be conducting their own probes," according to Ed Silverman on Pharmalot.

"A half a billion dollar one-time settlement is just a small cost of doing business for a company that sold $17 billion worth of the offending drug in the last five years," Dr. Roy Poses points out on the Health Care Renewal web site. In 2008 alone, Seroquel had world-wide sales of more than $4.4 billion.

As of July 13, 2009, AstraZeneca was also defending approximately 10,381 served or answered personal injury lawsuits and approximately 19,391 plaintiff groups involving Seroquel, according to SEC filings. Some of the cases also include claims against other drug makers such as Eli Lilly, Janssen Pharmaceutica and/or Bristol-Myers Squibb, the filing notes.

On September 23, 2009, Shire Pharmaceuticals received a subpoena from the US Department of Health and Human Services Office of Inspector General in coordination with the US attorney for the Eastern District of Pennsylvania, seeking production of documents related to the sales and marketing of Adderall XR, Daytrana and Vyvanse, according to Shire's third quarter report for 2009.

In a November 6, 2009, SEC filing, Abbott Labs said the federal prosecutor for the Western District of Virginia was conducting an investigation for the US Justice Department of whether the company's sales and marketing of Depakote violated civil or criminal laws, including the Federal False Claims Act and an anti-kickback statute related to reimbursement by Medicare and Medicaid programs to third parties.

In 2008, Depakote had sales of $1.36 billion and Abbott CEO, Miles White, had a salary and compensation package of $28,253,387.

In February 2009, the DOJ unsealed a lawsuit alleging that Forest Laboratories marketed the antidepressants Celexa and Lexapro for unapproved uses in children, and paid kickbacks to induce doctors to promote the drugs, including Dr. Jeffrey Bostic at Harvard University. In its latest SEC filing, Forest disclosed that it reached an agreement in principle in May 2009 to settle the civil aspects of US federal and state probes. "Penalties in the civil settlement are covered by a $170 million reserve Forest created in April," according to a November 9 report by Dow Jones.

Forest also disclosed that the agreement "does not resolve the government's ongoing investigation into potential criminal law violations" related to Celexa and Lexapro, and thyroid drug Levothroid, Dow Jones notes. In 2008, the salary and compensation for Forest CEO, Howard Solomon, was $6,565,324.

Over the past year and a half, a large number of so-called "Key Opinion Leaders" in the field of psychiatry have been exposed for not fully disclosing money received from many of the drug companies above through an investigation by the US Senate Finance Committee under the leadership of Iowa Republican Sen. Chuck Grassley.

The list so far includes Harvard University's Joseph Biederman, Thomas Spencer and Timothy Wilens; Charles Nemeroff and Zackery Stowe from Emory; Melissa DelBello at the University of Cincinnati; Alan Schatzberg, president of the American Psychiatric Association from Stanford; Martin Keller at Brown University; Karen Wagner and Augustus John Rush from the University of Texas and Fred Goodwin, the former host of a radio show called "Infinite Minds," broadcast by National Pubic Radio.

Fines as a Business Expense

The fraud settlements are "merely a cost of doing business to these pharmaceutical Goliaths and, in fact, caps their liability for these crimes," said Alaskan attorney Jim Gottstein, the leader of the Law Project for Psychiatric Rights (PsychRights), a public interest law firm.

"Most importantly," he noted, "these settlements have not stopped the practice of psychiatrists and other prescribers giving these drugs to children and youth and Medicaid continuing to pay for these fraudulent claims."

"Because of the massive, harmful, increase in the psychiatric drugging of America's children and youth, who are inherently forced, PsychRights has made addressing the problem a priority," he said.

Gottstein conducted an investigation and determined that the vast majority of off-label psychotropic drug prescriptions for children and youth that are paid for by Medicaid constitute Medicaid fraud.

PsychRights now has a national "Medicaid Fraud Initiative Against Psychiatric Drugging of Children & Youth," designed to address this problem by "having lawsuits brought against the doctors prescribing these harmful, ineffective drugs, their employers, and the pharmacies filling these prescriptions and submitting them to Medicaid for reimbursement," according to its web site.

"Anyone who submits or causes claims to be submitted to Medicaid for drugs that are not for a 'medically accepted indication' is committing Medicaid Fraud," said Gottstein, in a July 27, 2009 press release announcing the launch of the national campaign.

"Those guilty of this Medicaid Fraud include psychiatrists and other physicians prescribing these drugs, their employers, and pharmacies submitting the false claims to Medicaid," he pointed out.

PsychRights estimates that over $2 billion in such fraudulent Medicaid claims are being paid by the government each year.

"Once one sues over specific offending prescriptions, all of such prescriptions can be brought in, which means that any psychiatrist on the losing end of such a lawsuit will almost certainly be bankrupted, because each offending prescription carries a penalty of between $5,500 and $11,000," PsychRights explained.

It is hoped that once the doctors and pharmacies realize they are subject to financially ruinous Medicaid fraud judgments, the practice will be stopped or substantially reduced.

"Each prescriber may have a million dollars or few, at most, to lose, but the pharmacies' financial exposure can run into the hundreds of millions of dollars and it is hoped this will attract attorneys to take these cases," the web site noted.

In September and October 2009, Gottstein gave presentations on the initiative at the annual conferences of the National Association of Rights Protection and Advocacy and the International Center for the Study of Psychiatry and Psychology in order to find people who are potentially interested and willing to pursue such cases.

"This was successful and we have at least a few such cases cooking," he reported. "PsychRights stands ready to help people interested in bringing such suits."

In late 2006, Gottstein won international fame by subpoenaing and releasing thousands of documents involving Eli Lilly's illegal marketing of Zyprexa, which resulted in front page stories in The New York Times.

PsychRights also has an appeal pending on a lawsuit filed against the state of Alaska and responsible state officials seeking declaratory and injunctive relief that Alaskan children and youth on Medicaid have the right not to be administered psychotropic drugs unless and until a number of specific conditions are met. The lawsuit seeks to prohibit the state from paying for psychiatric drugs prescribed off-label to children and youth.

In responding to the lawsuit, the state claimed that they do have any control over or responsibility for the psychiatric drugging of children in their custody, or any responsibility under Medicaid, and moved for dismissal on the grounds that PsychRights does not have standing, or the right to bring the suit, because it was not harmed by the state's actions.

The court agreed and dismissed the case. "We think the judge is wrong and have filed an appeal," said Gottstein.

In May 2009, Gottstein sent letters to Sens. Charles Grassley and Herb Kohl and Reps. Henry Waxman, Bart Stupak, John Dingell and Barney Frank, describing the massive Medicaid fraud involved in the prescribing of psychiatric drugs to children in the US and asked for "assistance in stopping these illegal reimbursements."

As of November 8, 2009, Gottstein reported, "I haven't gotten as much as an acknowledgment of receipt from any of the members of Congress to whom I wrote."

While pursuing causes on behalf of PsychRights, Gottstein donates all of his time on a pro bono basis.

Evelyn Pringle is an investigative journalist focused on exposing corruption in government and corporate America. She won multiple awards for her investigative reporting from the International Center for the Study of Psychiatry and Psychology.

© Scoop Media