Morning Briefing
Summaries of health policy coverage from major news organizations
Prescription Drug Cost Managing Company To Pay Kansas $27.6M
AP: Kansas To Get $27.6M From Firm Investigated Over Drug Costs
Kansas will receive nearly $27.6 million from a legal settlement with the company that manages prescription costs for its Medicaid program, after an investigation into whether the company had overcharged the state, Attorney General Derek Schmidt announced Monday. The settlement with St. Louis-based Centene Corp. comes after a nearly two-year investigation by Schmidt’s office and a Jackson, Mississippi-area law firm it hired to review Centene’s practices. States throughout the country have been investigating companies known as pharmacy benefit managers, and Mississippi and Ohio in June settled lawsuits against Centene for a total of nearly $144 million. (Hanna, 12/6)
And more legal news —
AP: Theranos Founder Elizabeth Holmes Faces Cross-Examination
The fraud trial of fallen Theranos founder Elizabeth Holmes is set to resume Tuesday with continued cross-examination of Holmes and possible expert psychological testimony. Holmes, 37, has pleaded not guilty to charges of defrauding investors and patients by failing to deliver on her promise to revolutionize health care with a technology that was supposed to be able to detect a wide range of diseases and other problems by testing just a few drops of blood. She is charged with two counts of conspiracy to commit wire fraud and nine counts of wire fraud, which carry a maximum prison sentence of 20 years. (12/7)
AP: Former Pharma Executive Charged With Embezzling Millions
A former executive and owner of a pharmaceutical company embezzled millions of dollars from his company to use for personal expenses, the U.S. attorney’s charged in a criminal complaint released Monday. John Klein allegedly took about $3.9 million from a customer in 2016 and deposited it into an account he controlled, then used the money to pay for personal expenses including credit card payments, property taxes and his child’s private school tuition, all while allowing the company to represent in its financial statements that the money hadn’t been collected. ... Klein’s company wasn’t identified in the complaint, but his online bio and other court filings list him as the CEO of Cambridge Therapeutic Technologies, a company that was headquartered in Teaneck and engaged in the packaging and distribution of pharmaceuticals. (12/6)
In other pharmaceutical industry news —
The Wall Street Journal: Johnson & Johnson Prepares To Untangle Finances Ahead Of Planned Split
Johnson & Johnson is trying to figure out how to divide its supply chain and substantial financial holdings as part of a planned split into two publicly-traded businesses. The New Brunswick, N.J.-based healthcare and consumer-goods giant last month said it would split off its consumer-health business, which sells Tylenol medicines, Band-Aid bandages and Johnson’s Baby Powder, into a so-far unnamed company in 18 months to two years. The company is considering spinning out the unit and holding a stock offering. (Maurer, 12/6)
Stat: Flagship To Launch A New Startup Focused On Neurodegenerative Conditions
Flagship Pioneering is gearing up to launch a new company that seems to be developing precisely targeted treatments for neurodegenerative conditions, including Parkinson’s. The new startup, dubbed Vesalius Therapeutics, will be led by Chris Austin, a high-profile recent Flagship recruit who was the founding director of the NIH’s National Center for Advancing Translational Sciences and a senior adviser to the National Human Genome Research Institute. Neurodegenerative conditions are one of his scientific areas of expertise. (Sheridan, 12/7)
Stat: Carbon Health Launches A Program For CGMs To Curb Diabetes Risk
In April, endocrinologist Calvin Wu described how his company, Steady Health, was making use of the flowing stream of data from continuous glucose monitors to help patients with type 1 diabetes manage their blood glucose and avoid dangerous complications. That effort extended to some patients with type 2 diabetes, but he drew the line there. “I think there may very well be a role for CGM down the road as more of a preventative kind of use case,” said Wu. “But I think the challenge here is that the evidence for that right now is fairly light.” (Palmer, 12/7)
Stat: Acadia Pharmaceuticals Drug Meets Endpoints For Treating Rett Syndrome
An experimental drug being developed by Acadia Pharmaceuticals improved the symptoms of women and girls with Rett syndrome, a rare genetic disease that robs patients of the ability to interact socially and can cause seizures and other neurological problems, the company said Monday. The data were made public in a press release and have not yet been peer-reviewed. (Herper, 12/6)
