For Cephalon, Nearly As Many Probes As Drugs

For Cephalon, Nearly As Many Probes As Drugs

October 4th, 2011 // 1:35 pm @

Late last week, Cephalon disclosed yet another government investigation into its handling of one of its drugs. The latest probe is being conducted by the US Department of Justice into “certain promotional practices” concerning the Nuvigil and Provigil medications, which are used to treat sleeping disorders.

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The disclosure followed by just a few days a subpoena from the US Attorney in New York requesting documents pertaining to off-label issues and clinical trial work for the Treanda medication, which is approved to treat chronic lymphocytic leukemia .

And earlier this year, the US Postal Service began an investigation into its Fentora pain med for cancer patients. There were no further details, but you may recall that, in 2008, Cephalon paid $425 million to settle charges that it promoted Actiq, a drug similar to Fentora, for off-label marketing .

And so, all four major medicines that Cephalon actively markets are under investigation by this or that federal agency. Not surprisingly, Teva Pharmaceuticals, which agreed to pay $6.8 billion to acquire Cephalon, says there is no reason for concern, even though Cephalon signed a five-year Corporate Integrity Agreement in 2008 to settle off-label marketing charges.

“I don’t have all the facts, because we are still operating as separate companies,” Bill Marth, who heads Teva’s US operations, told The Philadelphia Inquirer. “That said, with the due diligence we’ve done, the corporate integrity agreement (with the federal government) is very strict and they (Cephalon) have a robust compliance program. I realize there are investigations from time to time, but I believe they have probably done a very good job…I don’t think there is a Cephalon problem. We’re excited about the transaction. We still anticipate it closing in mid-October and I don’t think it will impact that at all.”

To cope, Teva could attempt to bolster investor confidence by inferring that a new regime will soon be put in place and that, regardless of various federal probes, the products offer ongoing sales potential. The bottom line is, after all, the bottom line. Whether that line of reasoning – should Teva offer such an explanation – would hold up is unclear, since much of the Cephalon team will remain in place.

For instance, Kevin Buchi, who is currently the Cephalon ceo, will now head all global branded products, although commercial activities will not be a big part of his portfolio, a Cephalon spokeswoman explains. In any event, he has worked at Cephalon for almost 20 years, most recently, as chief operating officer and this involved overseeing global sales and marketing functions.

Among the others is Leslie Russell, the Cephalon chief medical officer, who will head up global branded R&D. Then, there is Bill Campbell, the vp of sales and marketing for pain meds at Cephalon, who will become general manager of oncology. Another exec is Mike Durkacz, the CNS vp at Cephalon, who will become general manger of CNS.

There is nothing to suggest specific Cephalon execs warrant individual scrutiny, but the mounting number of probes of nearly the entire product portfolio could, nonetheless, complicate the acquisition. The Cephalon spokeswoman, however, noted that the CIA required strict compliance and the marketing efforts for these meds were fully vetted.

Source: Pharmalot


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