Former Amgen Rep Stymied By Arbitration
9 CommentsBy Ed Silverman // January 11th, 2010 // 8:48 am
In October 2006, a former Amgen sales rep filed a complaint against the biotech for $10 million before an arbitrator, claiming she was fired in retaliation the year before for not complying with an allegedly improper marketing strategy for the Enbrel rheumatoid arthritis med. Elena Ferrante claimed Amgen sales managers encouraged reps to promote off-label and encouraged docs to prescribe Enbrel to patients who may not have needed the drug, according to Ferrante’s lawyer, Lydia Cotz (here is the complaint).
When Ferrante refused to cooperate, Lydia Cotz, Ferrante’s attorney, says her client was fired, but ostensibly for other reasons, including not attending client dinners. Ferrante was a top seller who made about $400,000 a year in sales at the time she was dismissed, according to Cotz.
Three years later, the dispute remains unresolved, and Ferrante and her attorney contend the arbitration has amounted to a thinly disguised and expensive stalling tactic. Consequently, they say the proceedings have prevented the full extent of Amgen’s marketing actions from coming to light at a time when 15 state attorneys general are pursuing their own lawsuit against Amgen for an alleged ‘kickback scheme’ to boost sales of a different anemia med, Aranesp.
“As one of the most significant aspects of my arbitration case against Amgen involves allegations of Medicaid fraud, I believe that Andrew Cuomo, NYS Attorney General, should issue subpoenas to JAMS (the arbitration service), as should all of the states’ Attorneys General who are suing Amgen for Medicaid fraud,” Ferrante wrote us. “I am confident that this move would uncover a wealth of documentation supporting allegations of fraud.”
The issue, according to Cotz, is that JAMS arbitration proceedings allow employers to pursue confidentiality, even though she maintains an agreement that Ferrante was required to sign didn’t specify that arbitration would be kept confidential. “She never signed to that effect,” she says. “But the issues raised by clients should be mandated for public disclosure, because they affect the health and safety of the public.” As a result, she argues, info from the Ferrante case that may be pertinent to the multi-state investigation is unavailable for the state AGs to pursue.
“Arbitration can become a burial ground for misdeeds, which is why corporations want it,” says Rob Henning, another lawyer who represents a former Amgen employee in California. “With court records you can look up documents. The problem is in arbitration, it’s almost impossible to get those documents. It becomes a secretive forum. Some times, all parties want that - i. e. a private contract with salacious details…But when you’re talking about corporate fraud or the public policy interest of the state, this is of concern to all citizens. To use arbitration to essentially bury misdeeds presents a larger problem and should affect everyone.”
Meanwhile, Cotz maintains Amgen has used the arbitration to draw out the proceedings and generate thousands of dollars in legal costs to her client. “The cost to a plaintiff of initiating an arbitration is almost always higher than the cost of instituting a lawsuit,” she writes us. “These costs have a deterrent effect, often preventing a claimant from even filing a case.”
Henning notes that employers pay JAMS (Judicial Arbitration and Mediation Services), which is a for-profit service and, in turn, compensates individual arbitrators. “JAMS is a for-profit and owned by the people who do all the arbitration,” says Henning. “It’s significant because if you are the arbitrator and you know its always the employer paying for the arbitration, its not a fair system.”
Spokespeople for Amgen and JAMS declined to respond.
photo courtesy of ohadweb on flickr creative commons
joe blow
$400K a year? I call BS on that one. Show us the W-2’s.
Chris
The statement was that she made $400K in sales. It did not say $400K in compensation.
JimK
Her case seems to be predicated more upon her termination than on her refusal to market enbrel. Her claim seems to be based predominantly on her being disabled. I am not familiar with NJ law in the area of disability but her complaint merely alleges that she is disabled. I realize that this is only a complaint but she will need to clear a high hurdle to demonstrate a disability claim, at least under Federal law. The same is true for cases involving age discrimination. In either case she must demonstrate that Amgen’s reasons for her termination are purely pretectual. I am a little rusty in this area but the mere hiring of younger workers is not sufficient if the company can articulate the aforementioned legitimate business reason for her termination.
Moreover, since she never alleges a FMLA violation I must assume that she would fall under the category of an exempt professional employee.
In addition, the studies on Enbrel demonstrate a wide variety of possible adverse events, including tuberculosis, multiple sclerosis, transverse myelitis and a host of other significant adverse events. Her only claim is for congestive heart failure and apparently she had no trouble marketing Enbrel even knowing the scope of the adverse events associated with this drug. In addition Amgen conducted trial studies on the use of Enbrel as a treatment for CHS. The study was discontinued for lack of efficacy and did confirm a higher incidence of CHS. However, a second study failed to corroborate the findings of the initial study on CHS.
Ms. Ferrante’s conclusions on CHS seem to be based primarily on post marketing results, which I believe would not be sufficent to prover her claim unless she has a smoking gun document from Amgen that recognizes the fact that Enbrel is a primary cause of CHS.
Finally, I am assuming, based upon the compalint that the Medicaid Fraud charge is implied snce she offers no direct evidence in her allegation to corroborate this charge. Again I realize that her attorney’s are onlt postulating the possibility of possible fraud.
Finally, I assume she signed an Arbitration agreement and she is seeking to bypass arbitration by pressing her court case under the Public Policy doctrine exemption to Arbitration rulings. The problem here is that Arbitration procedures are sanctioned by law and it would appear to be somewhat premature for her to be claiming a public policy argument prior to an actual arbitration decision.
i must admit my arbitration experience is in the field of Collective Bargaining Agremeents and individual arbitration contracts may differ.
Amy
No question she made the 400k a year.
I worked with Amgen and made over $300k.
I also sold Enbrel.
Tina J.
For Jim K,
You must be looking at the wrong case. There are many documents which corroborate the Medicaid fraud allegations, as well as all of the other off-label allegations.
The CHF data was not only based on post marketing anaylsis, but on two studies conducted prior to Enbrel’s release. As for the additional A/E’s, this representative always gave full disclosure when providing information to physician customers, and made sure that only the appropritate patients were given the drug. Otherwise, she might still have a job.
JimK
Tina J.
I am just reading the Complaint, which only contains allegations of fraud. The evidence of medicaid fraud involves another product (Aranesp) and not Enbrel.
However, it would be reasonable to assume that the kickback scheme utilized in the marketing of Aranesp was also used in the marketing of Enbrel especially if Ms. Ferrante is throwing Dr. Alice Gottlieb under the bus.
Tina J.
Jim K.
I am sure that you must know that Dr. Gottlieb is a highly respected physician who always followed the rules and never participated in any questionable marketing tactics. And if you didn’t, you do now.
I am certain that Ms. Ferrante has never even mentioned Dr. Gottlieb in her arbitration, as the only one who perpetrated any wrongdoing was the company, AMGEN, not the physicians.
It is interesting to me as an observer of this and other whistleblower cases, how AMGEN has tried to portray the doctors in a negative light, and then blame the whistleblowers for “throwing doctors under the bus”.
You folks should stick to the facts!
JimK
Tina J.
I have not read any information from Amgen, the only information I read was that which was contained in Ms. Ferrante’s “Complaint” and the “Demand for a Jury Trial” by the States pursuing legal action against Amgen.
I realize that the statements contained in Ms. Ferrante’s “Complaint” regarding Dr. Gottlieb were for the purpose of demonstrating Ms. Ferrante’s marketing abilities and not as an admission of guilt in a kickback scheme.
The problem I see with Ms. Ferrante’s Complaint against Amgen is that there appears to be a lag between the time that Amgen changed its marketing strategy (Complaint is vague but an inference can be drawn that it was somewhere around 2002) and the adverse actions taken against her (2005). The only other item that may be construed as an adverse action is the reduction in Ms. Ferrante’s sales territory, however in the context of her “Complaint” it does not appear that she is alleging this to be an adverse action.
Just one final word on the subject and that is in the Aranesp case medical providers were parties to the kickback scheme as it was the medical providers who received kickbacks in return for prescribing greater quantities of Aranesp.
In fact Attorney General Andrew Cuomo specifically stated that Amgen induced third party providers to overbill Medicaid (attached link).
http://www.ag.ny.gov/media_center/2009/oct/oct30a_09.html
sthpaw58
i was there and from the beginning. amgen uses many tactics to produce revenue. they are/where a financial company who just happened to make a drug. taught many dialysis nurse how to use overfill and then charge. can you say fraud and abuse. epo is the revenue stream for the dialysis folks accounting up to 40% of total revenues. stay tuned more to come from my end. i not not thru with you kevin and company. you are assisting in screwing the tax payer and simply out of greed. you have no competition. and yes she may have well made that much money. i mad 250 back in the 90’s