Pelosi's ETHA bill and Amgen (updated)

By Ray Robison

Previously, we reported the suspicious timing of Amgen executives making large donations to Speaker Pelosi's campaign just before she submitted a bill that would likely increase that company's bottom line. The Early Treatment of HIV Act (ETHA) would expand coverage of a pricey drug, EPOGEN® made by Amgen and used in treating anemia in HIV positive patients. In addition, the drug is marketed as PROCRIT® under license by Johnson & Johnson, a company in which -- according to her most recent financial disclosure -- she was heavily invested in at the time. J&J sales would increase and likely benefit Amgen (although possibly indirectly) under licensing agreements. CNSnews has investigated and affirmed our initial revelations to a great extent and added to the case.

Medicaid announced it was considering cutbacks in government purchasing of those drugs several months before the Amgen donations were made. Just a few days before Medicaid was set to announce implementation of the rules change, Amgen execs began dumping money into the campaign coffers of Speaker Pelosi and the Democratic Party. Speaker Pelosi submitted the ETHA bill, which would reverse some of the Medicaid expenditure reduction within hours of the formal announcement of the Medicaid changes.

In addition, as Speaker of the House, Nancy Pelosi sets the agenda of the House. The House joined the Senate in approving informal resolutions urging Medicaid to cancel the rules change late last year. The effort worked, Medicaid did so and Amgen stocks soared. The House resolution and the separate ETHA bill were both overwhelmingly backed by Democrats. Amgen CEO, and President Kevin Sharer pumped $26,000 into congressional Democrats campaign committees in the weeks before the ETHA bill was submitted and after Medicaid announced it was considering the rules change.

Pelosi received $30,000 from Amgen executives to her campaign and the Democrat campaign committees received $26,000 just prior to the bill submittal. A look at the 2007 donations of Amgen show very little donations at any other time, in 2007 or otherwise.

Subsequent investigation has revealed that another money-maker drug made by Amgen estimated to cost $30,000 per patient in some cases would likely benefit from increased purchasing under ETHA implementation. That drug called Enbrel is used as an inhibitor in cases of severe psoriasis among other conditions. Many HIV patients develop psoriasis and other conditions which are also under medical testing with Enbrel treatment. If approved by the FDA for treatment in HIV associated illness, the expanded market of government purchasing provided by the ETHA bill could be a real windfall for the company.

A PriceWaterhourseCooper study showed that the early treatment of HIV bill could increase coverage to about 30,000 patients in the first year alone. Even if only 1% of the newly covered population receives Enbrel treatment it could increase Amgen sales by millions of dollars.

According to an article in the Sioux City Journal, Amgen is currently under investigation for marketing practices related to Enbrel. Two former Amgen sales reps have stepped forward to claim they were fired for refusing to follow Amgen instructions in regard to pushing the drug because they believed the methods to be damaging and unethical. The Journal reports that "two federal agencies and four state attorneys general" are investigating the claims.

(To be clear, for me, the issue is the apparent conflict of interest and improper influence not with ETHA itself)

Update -- Author’s note: In researching this article, a database search showed Mr. Sharer donating $26k to Democratic congressional committees. The same search for “Republican” showed only a small amount. However, the author conducted a second search after publication by “individual contributor” and found the same amount donated to Republican committees by Mr. Sharer. This removes the appearance of preferential treatment to the Democratic committees but does not affect the large donations to Pelosi’s campaign that coincided with her submission of the ETHA bill or her likely stock ownership of related stocks, or her likely shepherding of the informal resolution to cancel the Medicaid rules change. I apologize for any confusion created by the omission. Please note, this was not in response to a complaint, but merely found in continuation of our efforts to research this story.