Congress To Probe Vytorin Insider Stock Sales
11 CommentsBy Ed Silverman // January 16th, 2008 // 2:47 pm
As part of its investigation into why Merck and Schering-Plough held onto the Vytorin trial data for two years and briefly changed the primary endpoint before the disappointing results were finally released this week, the House Subcommittee on Oversight and Investigations now plans to also look at the possibility that any of the drugmakers’ execs engaged in insider trading.
A subcommittee spokesman tells us that letters are due to be sent to Merck and Schering-Plough today or tomorrow, following comments made this morning on CBS’s Early Show by subcommittee chair Bart Stupak, a Democrat from Michigan. “There’s certainly major misrepresentations not only to the effectiveness of the drug, but manipulating of the scientific data to further promote a product that isn’t doing what it was designed to do,” he told the TV program.
Stupak was responding to an item that originally ran on BrandweekNRX that Carrie Smith Cox, Schering-Plough’s president, sold 900,000 shares of company stock last April and May worth an estimated $28 million. We are waiting for a comment from Schering-Plough regarding the reasons for the sales. Meanwhile, here is the initial letter issued by the subcommittee when it opened its investigation.
[UPDATE: This evening, a Schering-Plough spokesman writes to say "the company has a rigorous process that executives follow before initiating any transaction in company securities, including pre-clearance with a securities lawyer; Carrie Cox followed these processes, as well as filing required SEC disclosures about the transactions on time. To date, the company has received no inquiry from a regulatory body relating to her trades. These trades go back to the spring of 2007, and the data for this trial were only unblinded approximately 2 weeks ago.]
[UPDATE #2: Earlier, the committee issued a separate letter to the drugmakers, seeking records concerning communications with the five members of the not-so-independent panel of experts and reams of documents concerning Vytorin ads, which the committee worries aloud was promoted even as Merck and Schering-Plough knew there was no benefit to the drug.]
Dave
Hi Ed,
The big news broke on CBS News online this morning. If you go to the Yahoo Financial Website, you can see the amounts that were sold by several of the top management team - Ron Cheeley (HR), Brent Saunders (Compliance), Tom Sabatino (Legal) - among others. This could be huge. For anyone that read about Martha Stewart, she only made a few hundred thousand dollars. It looks like Carrie Cox made about 150-200x that amount. I don’t know if she’ll make the Top 50 Women in business for 2008.
This is a potential timebomb. If Congress also starts to look at how Schering-Plough spends its’ marketing money by examining the “real” books, they will find some very serious problems. The reputation of the company and their key executives will be completely shot!
francis comeaux
Almost one year ago, a family doctor prescribed Vytorin to a wh male 72 years, retired hard worker nondrinker, nonsmoker
for a minor elevation of cholesterol. Within 5 months, it was evident that such medication caused high fevers, chills, muscle pain and immobility. Two 30day phases of periods of hospitalization for liver enzyme changes 8 baffled doctors did order gallbladder removal later followed by spleen removal. Patient continued to suffer total body pain; over 20 scans, one detected spinal fractures no doubt caused by prednisone.
Surgery for spinal stenosis was delayed by three weeks. My friend since childhoor, died January 15, 2008. Family very much interested in seeking monetary damages. Vytorin does kill……….FhC
John
Carrie Cox deserves evrything she gets.
Chuck
Francis,
A very sad story about you friend. From a medical standpoint, it sounds like the primary culprit drug was the simvastatin. Lovastatin and simvastatin have caused more safety issues than the other statins. Unfortunately, simvastatin is the statin in Vytorin.
John
Hi Ed,
This stody is a hot one. I just hope that Congress doesn’t drop the ball on this one. There is a lot to be found by an investigation.
Live by the sword, die by the sword! It couldn’t be more appropriate in the case of Ms. Cox.
francis comeaux
Almost one year ago, a family doctor prescribed Vytorin to a wh male 72 years, retired hard worker nondrinker, nonsmoker
for a minor elevation of cholesterol. Within 5 months, it was evident that such medication caused high fevers, chills, muscle pain and immobility. Two 30day phases of periods of hospitalization for liver enzyme changes 8 baffled doctors did order gallbladder removal later followed by spleen removal. Patient continued to suffer total body pain; over 20 scans, one detected spinal fractures no doubt caused by prednisone.
Surgery for spinal stenosis was delayed by three weeks. My friend since childhood, died January 15, 2008. Family very much interested in seeking monetary damages. Vytorin does kill……….FhC
Tom
I’ve known Carrie for a long time and this is exactly like her. She’s always acted like rules are for everyone else and she can do what she wants. Well, maybe it will finally catch up with her. She weaseled out of phen/fen at AHP. She slithered out of off-label promotion at Pharmacia. Will she be able to escape this time. She may have met her match in Congress. But then again, maybe her own personal “Mentor” and “Pharma Savior” (Fred Hassan) will swoop in and save the day once again. Sell off Schering-Plough, move to another comapny as CEO, probably off-shore in Pakistan, anoint Carrie President, move there and never return!
Fred
All,
Carrie is a wonderful woman and a fine human being. She would never do anything that wasn’t totally and completely honest and trustworthy. She has worked for me fro years and I can personally vouch for her character. She is a dedicated, hard-working employee and does everything she can to help the comapny.
Please stop picking on her!
FH
CC
All,
Just look at that face. Isn’t she the most innocent looking woman you’ve ever seen? Perhaps since Cruella DeVille? Or maybe the Wicked Witch of the West? She would never ever do anything like lie, cheat or steal. In fact, at one point in her life she almost entered the convent. Or was it a nunnery?
Please cut me, uh her, a break.
CC
Drew
She has always been a witch on wheels! Let’s see if she can get out of the way of the avalanche rolling downhill.
Melody
But . . but . . . but . . . the ACC and AHA both encourage doctors to “not withdraw” patients from Vytorin. Surely these prestigious, INDEPENDENT organizations wouldn’t dispense information that was detrimental for patients, would they?