Chi­nese agency says sus­pects ar­rest­ed in As­traZeneca in­sur­ance fraud probe

Mul­ti­ple sus­pects were ar­rest­ed in con­nec­tion with an al­leged med­ical in­sur­ance fraud scheme or­ga­nized by As­traZeneca Chi­na em­ploy­ees, the coun­try’s Na­tion­al Health­care Se­cu­ri­ty Ad­min­is­tra­tion (NHSA) said on Sat­ur­day.

The ar­rests oc­curred af­ter an in­ves­ti­ga­tion found ev­i­dence that staff mem­bers tam­pered with the ge­net­ic test­ing re­sults of tu­mor pa­tients in an at­tempt to de­fraud med­ical in­sur­ance funds, ac­cord­ing to the NHSA. As­traZeneca has re­port­ed sub­stan­tial growth in Chi­na de­spite the steep dis­counts it had to make in or­der to get on the coun­try’s Na­tion­al Re­im­burse­ment Drug List, with rev­enue in the coun­try in­creas­ing by 10% in Q3, amount­ing to near­ly $4.7 bil­lion for the first three quar­ters of the year.

How­ev­er, the com­pa­ny not­ed that rev­enues last year were im­pact­ed by pric­ing pres­sure as­so­ci­at­ed with the NRDL and vol­ume-based pro­cure­ment (VBP) pro­grams.

With­out pro­vid­ing much de­tail, As­traZeneca Chi­na said in a state­ment that it con­firmed through its own in­ves­ti­ga­tion back in Au­gust that “a few” of its em­ploy­ees in Shen­zhen had “al­tered or par­tic­i­pat­ed in al­ter­ing pa­tients’ test­ing re­ports,” and are sus­pect­ed of med­ical in­sur­ance fraud.

“Per our cur­rent un­der­stand­ing, these are in­di­vid­ual cas­es. The gov­ern­ment in­ves­ti­ga­tions are still on­go­ing, and the com­pa­ny hasn’t been in­formed of more de­tails,” a spokesper­son told End­points News. 

As­traZeneca Chi­na said it proac­tive­ly re­port­ed the of­fens­es to the lo­cal health­care se­cu­ri­ty bu­reau, and “took se­ri­ous dis­ci­pli­nary ac­tion” against the staff mem­bers, though it’s un­clear if they’re still em­ployed at the phar­ma gi­ant. On Sat­ur­day, the NHSA said an “in-depth in­ves­ti­ga­tion” had been con­duct­ed, and “all crim­i­nal sus­pects have been ar­rest­ed.”

On Dec. 27, As­traZeneca at­tend­ed a joint meet­ing with the Min­istry of Pub­lic Se­cu­ri­ty (MOPS) and the NHSA, which has urged the com­pa­ny to co­op­er­ate in the fol­low-up in­ves­ti­ga­tion, car­ry out its own in­ter­nal in­ves­ti­ga­tion, “plug loop­holes in mar­ket­ing su­per­vi­sion,” and ed­u­cate its em­ploy­ees on fol­low­ing the law.

“As­traZeneca Chi­na is com­mit­ted to ful­ly im­ple­ment­ing these rec­om­men­da­tions, fur­ther strength­en­ing man­age­ment over­sight and con­tin­u­ing to ed­u­cate em­ploy­ees on the ap­plic­a­ble laws and reg­u­la­tions, en­sur­ing that each As­traZeneca em­ploy­ee per­forms dai­ly work with a law abid­ing and com­pli­ance mind­set,” the com­pa­ny said in a state­ment.

Chi­na’s Na­tion­al Med­ical In­sur­ance Bu­reau will now work with oth­er agen­cies to car­ry out a na­tion­wide cam­paign against tam­per­ing with ge­net­ic test re­sults, ac­cord­ing to the NHSA.

The news comes near­ly three decades af­ter As­traZeneca set roots in Chi­na in 1993. Just over two years ago, the com­pa­ny un­veiled three ma­jor ini­tia­tives in the hopes of ex­pand­ing its foot­print there, in­clud­ing the cre­ation of a new R&D cen­ter and AI in­no­va­tion cen­ter in Shang­hai, and a new Health­care In­dus­tri­al Fund in part­ner­ship with Chi­na In­ter­na­tion­al Cap­i­tal Cor­po­ra­tion Lim­it­ed.

“Chi­na is rapid­ly emerg­ing as a glob­al sci­en­tif­ic pow­er­house, which is why we have tak­en this ex­cit­ing de­ci­sion to fol­low the sci­ence, by ex­pand­ing our R&D pres­ence and by work­ing with the in­vest­ment com­mu­ni­ty,” CEO Pas­cal So­ri­ot said at the time.

To date, the com­pa­ny says it has in­vest­ed around three-quar­ters of a bil­lion dol­lars in Chi­nese phar­ma­ceu­ti­cal in­no­va­tion. And it doesn’t hurt that the Chi­nese mar­ket has added bil­lions of dol­lars to the its top line.

As­traZeneca isn’t the on­ly Big Phar­ma com­pa­ny with in­sur­ance fraud woes. Back in Au­gust 2020, Ab­b­Vie agreed to pay $24 mil­lion to set­tle an in­sur­ance fraud suit re­lat­ed to the pro­mo­tion of its cash cow Hu­mi­ra.

That set­tle­ment came near­ly four years af­ter a whistle­blow­er first re­port­ed Ab­b­Vie’s prac­tice of de­ploy­ing reg­is­tered nurs­es to vis­it pa­tients at home or call them by phone to en­sure that Hu­mi­ra pre­scrip­tions are filled. Ab­b­Vie was al­so charged with pro­vid­ing il­le­gal kick­backs to doc­tors in an at­tempt to en­cour­age them to pre­scribe Hu­mi­ra for a range of an­ti-in­flam­ma­to­ry dis­eases.

2023 Spot­light on the Fu­ture of Drug De­vel­op­ment for Small and Mid-Sized Biotechs

In the context of today’s global economic environment, there is an increasing need to work smarter, faster and leaner across all facets of the life sciences industry.  This is particularly true for small and mid-sized biotech companies, many of which are facing declining valuations and competing for increasingly limited funding to propel their science forward.  It is important to recognize that within this framework, many of these smaller companies already find themselves resource-challenged to design and manage clinical studies themselves because they don’t have large teams or in-house experts in navigating the various aspects of the drug development journey. This can be particularly challenging for the most complex and difficult to treat diseases where no previous pathway exists and patients are urgently awaiting breakthroughs.

Dipal Doshi, Entrada Therapeutics CEO

Ver­tex just found the next big ‘trans­for­ma­tive’ thing for the pipeline — at a biotech just down the street

Back in the summer of 2019, when I was covering Vertex’s executive chairman Jeff Leiden’s plans for the pipeline, I picked up on a distinct focus on myotonic dystrophy Type I, or DM1 — one of what Leiden called “two diseases (with DMD) we’re interested in and we continue to look for those assets.”

Today, Leiden’s successor at the helm of Vertex, CEO Reshma Kewalramani, is plunking down $250 million in cash to go the extra mile on DM1. The lion’s share of that is for the upfront, with a small reserve for equity in a deal that lines Vertex up with a neighbor in Seaport that has been rather quietly going at both of Vertex’s early disease targets with preclinical assets.

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Ab­b­Vie slapped with age dis­crim­i­na­tion law­suit, fol­low­ing oth­er phar­mas

Add AbbVie to the list of pharma companies currently facing age discrimination allegations.

Pennsylvania resident Thomas Hesch filed suit against AbbVie on Wednesday, accusing the company of passing him over for promotions in favor of younger candidates.

Despite 30 years of pharma experience, “Hesch has consistently seen younger, less qualified employees promoted over him,” the complaint states.

David Light, Valisure CEO

Val­isure in the hot seat: New Form 483 over a 2021 in­spec­tion as CEO fires back

The notorious drug testing company Valisure, which has made a name for itself by forcing FDA’s hand with some of its safety-related uncoverings, received a letter this week after the FDA uncovered violations at its Connecticut-based testing lab in 2021.

The letter, which was sent on Dec. 5, stated that the FDA is “concerned” that Valisure was not aware of  drug supply chain security requirements.

Mark Cuban (Jed Jacobsohn/AP Images)

Mov­ing to the em­ploy­er side of health­care, Mark Cuban's Cost Plus Drugs part­ners with a PBM

From “Shark Tank” to direct-to-consumer generic drugs, Mark Cuban has made another inroad in the ongoing battle over prescription drug prices. His cost-plus-15% generic drug company, frequently undercutting many competitors, now has its sights set on the employer healthcare market.

Cost Plus Drugs, which originally pledged to cut out PBMs, has now partnered with the PBM EmsanaRx, majority owned by the Purchaser Business Group on Health, to launch a supplemental drug discount program designed specifically for self-funded employers, the company announced Thursday.

WIB22: Am­ber Salz­man had few op­tions when her son was di­ag­nosed with a rare ge­net­ic dis­ease. So she cre­at­ed a bet­ter one

This profile is part of Endpoints News’ 2022 special report about Women in Biopharma R&D. You can read the full report here.

Amber Salzman’s life changed on a cold, damp day in Paris over tiny plastic cups of lukewarm tea.

She was meeting with Patrick Aubourg, a French neurologist studying adrenoleukodystrophy, or ALD, a rare genetic condition that causes rapid neurological decline in young boys. It’s a sinister disease that often leads to disability or death within just a few years. Salzman’s nephew was diagnosed at just 6 or 7 years old, and died at the age of 12.

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Ahead of ad­comm, FDA rais­es un­cer­tain­ties on ben­e­fit-risk pro­file of Cy­to­ki­net­ic­s' po­ten­tial heart drug

The FDA’s Cardiovascular and Renal Drugs Advisory Committee will meet next Tuesday to discuss whether Cytokinetics’ potential heart drug can safely reduce the risk of cardiovascular death and heart failure in patients with symptomatic chronic heart failure with reduced ejection fraction.

The drug, known as omecamtiv mecarbil and in development for more than 15 years, has seen mixed results, with a first Phase III readout from November 2020 hitting the primary endpoint of reducing the odds of hospitalization or other urgent care for heart failure by 8%. But it also missed a key secondary endpoint analysts had pegged as key to breaking into the market.

Bags of shred­ded docs: In­di­an drug­mak­er Lupin hand­ed a Form 483 by FDA in­spec­tors

The generics manufacturer Lupin has been given another Form 483 from the FDA this year.

US regulators inspected Lupin’s pharmaceutical manufacturing site in the town of Mandideep, India from Nov. 14 through Nov. 23, with the 14-page report marking 16 observations.

The inspection report stated that the site did not have the appropriate controls over its computer systems to ensure that changes in “master production” or records are only done by authorized personnel, along with written procedures not being established to conduct annual reviews of records associated with drug batches.

Publicis Groupe CEO Arthur Sadoun (L) is joined by actor Michael Douglas in a holiday message encouraging HPV vaccination (Publicis Groupe/YouTube)

Pub­li­cis for­goes light­heart­ed hol­i­day mes­sage for more se­ri­ous HPV warn­ing with celebri­ty guest

When is an annual holiday greeting more like a disease awareness ad? That’s the case in this year’s video from French-based advertising holding company Publicis Groupe featuring chairman and CEO Arthur Sadoun and his predecessor Maurice Lévy.

The typically jovial interaction between the two quickly takes a serious turn to HPV cancers and vaccines — along with a guest star appearance by actor Michael Douglas.

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