It's open season for off-label drug promotion - Axios
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It's open season for off-label drug promotion

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The pharmaceutical industry has been fighting for years to end restrictions on how they can market drugs for off-label uses — and now, under President Trump, the end of those restrictions is a near-certainty.

That's partly because Trump is sure to nominate a business-friendly replacement for Supreme Court Associate Justice Antonin Scalia, and partly because of the long-standing support for off-label marketing by Scott Gottlieb, the new president's most likely choice to run the Food and Drug Administration. Read on for more details.

The last decade has seen eight of the 10 major drug companies pay billions in civil settlements and criminal plea bargains for violating restrictions on off-label marketing — promoting drugs for uses not approved by the FDA. Federal officials at the Department of Health and Human Services, the FDA, and the Justice Department in both the George W. Bush and Obama administrations have regarded these violations as major white collar crimes that endangered or even killed tens of thousands of people.

But even before Trump's election, a series of court decisions made it increasingly uncertain that these rules would continue to be enforced.

Those court decisions have been part of a trend toward granting corporations the same First Amendment rights as individuals, thereby casting doubt on the viability of a variety of restrictions on corporate speech. From barring spending on political advocacy (Citizens United) to restricting billboards to limiting the collection and sale of drug prescription data, the First Amendment has become an unlikely go-to weapon for corporations fighting regulation.

Where the rules came from: The regulations date to 1962, when the FDA was beefed up and given the broad powers it has today to vet and approve drugs. After a laborious series of tests and clinical trials, a drug can be marketed only with an FDA-approved label — a dense document that tells doctors what a drug is supposed to be used for, what side effects to look out for, and what the appropriate doses are.

The stringent approval and labeling process was pushed by Senator Estes Kefauver, a Tennessee Democrat. As I recounted in a series I wrote for the Huffington Post in 2015 about the disastrous effects of Johnson & Johnson's off-label promotion of the anti-psychotic drug Risperdal to young boys and the elderly, Kefauver worried that once a drug was approved for any reason, "the sky would be the limit and extreme claims of any kind could be made" about the drug's safety and effectiveness.

In other words, allowing off-label promotion would undermine the balance of benefits versus risks that the new law required the FDA to weigh. A drug might be worth the risk of significant side effects if it helped alleviate a schizophrenic's hallucinations or urge to commit suicide. But it might not be worth those risks if it was used to treat a restless nursing home patient or a child acting up in school.

Moreover, if the drug companies were not required to get a labeling change from the FDA before selling a product more widely, there would be little incentive to undertake the clinical studies necessary to test the safety of the drug when deployed for those new uses. Why test whether the drug is safe for children if you can market it to children anyway?

However, the FDA has no authority to regulate how doctors practice, including what drugs they prescribe. And the drug companies argue, persuasively, that prescribing drugs for off-label uses is not only widespread but regularly alleviates illness and saves lives.

So, if, as has frequently been the case, a drug approved to fight one kind of cancer seems to work against a different kind, why shouldn't the drug companies be able to communicate accurate information about that quickly to doctors and insurance companies and even consumers, rather than await a years-long new approval process? Wouldn't that be in the best interests of patients?

Besides, doesn't the First Amendment guarantee the right not only of the drug companies to speak, but of doctors and patients to receive this important information?

Obama dodges the fight: In the last two years of the Obama Administration, lawyers at the Department of Health and Human Services and the FDA deliberately avoided testing restrictions on off-label promotion in court, even though key Obama officials and lawyers strongly believed in the need to restrict off-label promotions.Two key points where they could have fought and didn't:

  • In 2012, the administration declined to appeal a decision in the Second Circuit Court of Appeals in New York validating the First Amendment defense of a drug company salesman. The fear: a Supreme Court might hand down a precedent-setting decision that would free the drug companies.
  • Another New York decision by a trial court judge in favor of the marketer of a drug that targeted extreme cases of high cholesterol was also not appealed. Instead, the FDA agreed to allow the company to send materials to doctors about the efficacy of the drug's off-label use as long as the FDA could vet the materials first.

"Through all of last year, we figured we would wait 'til Merrick Garland or a Hillary [Clinton] appointee got there and then we would pick our case," says a key lawyer involved in the Obama administration's deliberations, referring to President Obama's pick to replace Scalia. "Now, of course, that road is blocked. I can't see how these regulations survive."

FDA under attack: Through the summer and fall of last year, the FDA engaged in a holding action of sorts, by declaring that it was considering a loosening of some of its restrictions, as it had done with the cholesterol drug. The agency even scheduled a two-day hearing at headquarters -- that began, ironically, the morning after Election Day -- to solicit comments from industry representatives and from those who opposed the industry's push for a free rein.

But by then it was clear to the industry lawyers who were there that Robert Califf, Obama's FDA commissioner, didn't matter. With a Scalia-like replacement now likely on the way, freedom from the FDA's restrictions seemed a foregone conclusion.

In fact, although lawyers who represent clients before the FDA are typically measured in expressing any disagreement with their all-powerful regulators, by mid-morning the gloves were off.

"In failing to address or even mention First or Fifth Amendment requirements, the hearing notice itself suggest that the agency does not appreciate or may be unwilling to accept the limits imposed by the constitution," Kelli Coombs, a lawyer representing a coalition of drug and device makers called the Medical Information Working Group, told Califf and other FDA senior officials assembled in the auditorium.

The FDA, Coombs said, doesn't get to decide what speech is OK and what isn't: "That is not how the constitution works."

Gottlieb sides with the drug industry: The man now thought most likely to take Califf's job is Gottlieb, a doctor and entrepreneur who is a resident fellow at the American Enterprise Institute. He has a long history of speaking out against the off-label promotion restrictions and the way the government had forced the drug makers to fork over billions in settlements.

As early as 2008, Gottlieb wrote this in an AEI white paper: "Those who pursue a rigid adherence to restrictions on the exchange of off-label information, and who fail to recognize that the sharing of scientific evidence can sometimes have important public health benefits, are guilty of pursuing a rigid standard that does not take measure of the consequences."

Then, in 2012, after asserting that "A fear of investigation has put many drug makers on the extreme defensive," Gottlieb wrote, "The restrictions on off-label use are premised on a belief that doctors will be misled by the scientific information. In highly specialized fields in which communication concerns truthful, non-misleading scientific material, physicians should be trusted to properly weigh a wide variety of information."

The other FDA candidate, venture capitalist Jim O'Neill, hasn't made his views clear on off-label marketing. But given what he has said about loosening the rules for FDA approval of new drugs, it's hard to be believe he'd insist on keeping the off-label marketing restrictions.

BP buys stake in solar company

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European oil and natural gas giant BP announced Friday it's investing $200 million over three years in Lightsource, one of Europe's largest solar companies, to acquire a 43% stake in the business.

The big picture: This is another sign of how big oil is slowly and gradually investing in lower-carbon technologies, alongside continued investments in oil and natural gas, driven by a series of overlapping factors, such as the notion of slowing oil demand and investor concern about climate change.

Yes but: This is a drop in the bucket compared to BP's nearly $2 billion net profit it disclosed as its most recent quarterly earnings. BP's renewable-energy assets, which also include wind farms in the U.S. and biofuels in Brazil, aren't "making a material difference to the bottom line," BP CEO Bob Dudley told an oil conference earlier this year.

Go deeper:


Report: Trump never held a high-level meeting on Russian interference

Photo: Manuel Balce Ceneta / AP

President Trump thinks conceding that Russia interfered in the 2016 election "would give ammunition to his critics," and becomes agitated by the mere mention of the issue by his aides, according to a Washington Post report.

Why it matters: Per WaPo, Trump "has never convened a Cabinet-level meeting on Russian interference or what to do about it," and his aides think he'd treat it as "an affront" if they were to even raise the matter. A former Russia adviser to Presidents George H.W. Bush and Bill Clinton told the Post: "Putin has to believe this was the most successful intelligence operation in the history of Russian or Soviet intelligence."

  • A former senior intelligence official said raising the issue "takes the [presidential daily briefing] off the rails," so information on the topic is sometimes only included in the written briefing, not in the oral presentation.
  • He was "raging mad" that Congress tied his hands by overwhelmingly passing Russia sanctions; WaPo reports it took four days for him to be persuaded to sign the bill. Aides told him: "If you veto it, they'll override you...and you look like you're weak."
  • Senior advisers abide by a policy of "don't walk that last 5 1/2 feet" when it comes to sensitive Russia issues, meaning not to go into the Oval and give "Trump a chance to erupt or overrule on issues that can be resolved by subordinates."

Go Deeper: Read the full Post report.


The White House plan to shift Americans' views on immigration

Relatives separated by the border wall betweeen Mexico and the United States meet. Photo: Herika Martinez / AFP via Getty Images

The Trump administration is planning a push to convince the American public that the current U.S. immigration system is "bad for American workers" and "bad for American security," White House spokesman Hogan Gidley told AP.

Between the lines: In exchange for a legislative fix for DACA recipients, the White House wants funding for a border wall and a switch from the existing family-based immigration system to a merit-based one. They plan to use data on chain migration and the number of immigrants in U.S. jails to make the case that the current immigration system is an economic and national security threat.


Trump has now appointed most ever federal appeals judges in 1st year

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Senate Republicans on Thursday confirmed President Donald Trump's twelfth federal appeals court nominee, setting a record for the most circuit court picks confirmed in a president's first year.

Why this matters: The federal courts carry significant weight in almost every area of policy: gun rights, executive power, LGBT rights, freedom of religion, etc, and have blocked multiple Trump initiatives in his first year. Trump's picks of young, conservatives judges for the lifetime appointments will far outlast his presidency.

Background: Richard Nixon and John F. Kennedy successfully appointed 11 appeals court judges in their first year.

  • Former President Barack Obama successfully appointed three appeals court judges in his first year in office in 2009, as well as Supreme Court Justice Sonia Sotomayor. His predecessor, George W. Bush, got six confirmed.

What they're saying: Senate Majority Leader Mitch McConnell, who has spearheaded the effort, said Republicans were having a "historic week."

  • Sen. Dianne Feinstein, the ranking Democrat on the Senate Judiciary Committee, lambasted Republicans, saying that the "speed at which these judges are being rammed through the process is stunning."

Trump spoke with Putin today

Trump and Putin at the G20 summit over the summer. Photo: Evan Vucci / AP

President Trump and Russian President Vladimir Putin spoke over the phone Thursday. Trump thanked Putin for praising the U.S. economy and the two of them discussed the North Korean nuclear threat, per the White House.

The backdrop: The call came hours after Putin said allegations of collusion between the Trump campaign and the Kremlin were "invented" by Trump's enemies at an annual press conference, AP reports. Putin said, “This is all made up by people who oppose Trump to make his work look illegitimate ... Look at the markets, how they went up; that speaks about investors' trust in what he does," echoing Trump.


Costco continues to hold its own against Amazon

Shares in Costco rose in after-hours trading, following the company's announcement of better-than-expected profits, combined with its 14th-straight month of same-store sales growth.

Costco's secret sauce is a mix of low prices, well-trained staff, and an ever-changing, but limited assortment of products, which have all kept Americans flocking to Costco outlets when other retailers have lost business to the Internet.

The most important number in Thursday's report was a 43.5% increase in e-commerce sales year-over year.

  • Though Costco stock is up more than 18% this year, it has lagged competitors like Amazon and Walmart over fears that the company is clinging too tightly to its profitable retail warehouses—these numbers will assuage some of those concerns.
  • During a call with analysts Thursday, CFO Richard Galanti stressed that Costco is experimenting with e-commerce "in our own way," and also, "pretty cheaply," using experiments like buy online and pick-up in store, which has the added benefit of driving traffic to its warehouses.
  • It's a delicate balancing act that, so far, investors are cheering.

Trump's "really diverse team" is mostly white

President Trump speaks during a cabinet meeting at the White House. Photo: Evan Vucci / AP

Omarosa Manigault, who was the only African American woman among President Trump's senior White House staff, drew attention to the Trump administration's lack of diversity when she resigned on Wednesday. Press Secretary Sarah Sanders maintained that the White House has "a really diverse team" across all departments, and are always trying to add to it.

The reality: Manigault, along with Housing and Urban Development Secretary Ben Carson, was one of two black officials among Trump's three dozen-plus team of Cabinet members and senior staffers.

Lack of diversity of Trump's cabinet: Ben Carson; Elaine Chao, who is Asian American; and Nikki Haley, who is Indian American, are the only non-white members of Trump's cabinet.

Omarosa also suggested traces of racial tension within the White House, as she said on "Good Morning America": "

"As the only African-American woman in the White House, I have seen things that have made me uncomfortable, that have upset me, that have affected me deeply and emotionally, that has affected my community and my people."

Shervin Pishevar leaves his venture capital firm

Photo illustration: Axios Visuals

Venture capitalist Shervin Pishevar has left Sherpa Ventures, the San Francisco-based firm he co-founded in 2013, following multiple allegations of sexual harassment. He has denied all of the claims, including one made on-the-record to Axios.

Sherpa's statement:

We thank Shervin for his contributions and service in co-founding Sherpa Capital. The Sherpa team remains focused on supporting our founders and portfolio companies, serving the interests of our Limited Partners across all of our funds. We are deeply committed to our culture of integrity, inclusion, and respect and will continue to put these values into action through all of Sherpa Capital's activities, including the founders and companies we support.

Pishevar, who is best-known as an early investor in Uber while with a previous VC firm, already had taken a leave of absence from Sherpa and his portfolio companies boards. He also is pursuing a lawsuit against a political opposition research firm that he claims is behind a "smear campaign" against him.

Pishevar's statement, which he posted via Twitter:


The most (and least) fuel-efficient U.S. airlines

Fueling manager Jarid Svraka looks on as he fuels an Alaska Airlines Boeing 737-800 jet. Photo: Elaine Thompson / AP

For the seventh year in a row, Alaska Airlines was the most fuel-efficient airline among U.S. carriers, according to a study from the International Council on Clean Transportation (ICCT).

Why it matters: Naya Olmer, the study's author, said Alaska Airlines "burns about 13% less fuel than the industry average, it's a profitable airline, and it's done this for seven years running...So, it's possible." The report also notes that aviation accounts for around 2.5% of global CO2 emissions, and U.S. carriers make up 30% of that.

  • But, but, but: As U.S. carriers saw a 10% spike in overall revenue passenger miles between 2014 and 2016, energy effienciy fell by the wayside and CO2 emissions jumped by 7%.
  • The other leaders in fuel-efficiency include Frontier and Spirit, which use "cleaner fleets, higher load factors, denser seating configuartions," and more.
  • Virgin America was the least fuel-efficient U.S. carrier in 2016; Jet Blue came second-to-last.

One more thing: Alaska Airlines bought Virgin American last year. Dan Rutherford, aviation director at the ICCT, told Axios that "a back-of-the-envelope suggests that Alaska would have lost its fuel efficiency advantage over Frontier, Spirit, and Southwest in 2016 if the merger had gone ahead then. But Alaska's future efficiency will depend on how it actually operates Virgin's leased A320s, and also for how long."


Trump: "I think Senator Rubio will be there" on tax bill

Screengrab via White House livestream

President Trump says he's confident the GOP tax bill will get Sen. Marco Rubio's vote despite a Washington Post report that Rubio is threatening to vote against the plan unless it includes the child tax credit expansion he has been advocating for.

Trump made the comments at a White House event where he "cut the red tape" of government regulations and claimed his administration has ended 22 old regulations for every new one created.