By Dick Miller 17
WE CONNECT DOTS: New England Compounding Center (NECC) was in a very lucrative business which has somehow escaped regulation by either the state of Massachusetts or the U.S. Food and Drug Administration (FDA). Pharmacists alter or remix existing drugs to meet particular needs of patients who otherwise are not responding to treatment. This is known as drug compounding.
State pharmacy boards are mostly responsible for oversight even though some, like NECC, have been supplying regular drug stores across state lines. The FDA claims that whenever they try to assert jurisdiction, courts rule otherwise.
This system remained under the radar until last fall’s fungal meningitis outbreak. The outbreak was eventually linked to an epidural steroid injection produced by NECC.
This report has been put together with dispatches by Reuter News, the Associated Press and CBS’s “60 Minutes.”
Now the toll has reached 620 documented cases in 19 states, resulting in 47 deaths.
NECC claimed FDA did not issue a meningitis warning for 684 days. FDA admitted to a “significant delay” but insisted the delay “in no way diminishes our serious concerns about (NECC) operations.
Now that the lax oversight has passed from the Bush Administration to Obama’s watch, the Republican controlled U.S. House of Representatives makes headlines, convincing us they ride white horses. Some reform measures granting FDA more regulatory power might be taken up by the 113th Congress, but don’t hold your breath.
Then again, the crisis might languish, similar to the recent debate on gun control. This could be another example of more concern about burdensome regulations causing corporations to lose profit.
Regardless, back in Boston, New England Compounding Center filed for Chapter 11 bankruptcy to deal with 130 lawsuits, and more being filed every day. The bosses at NECC claimed they would attempt to set up a fund to pay the victims inside the bankruptcy.
The Associated Press reported the bankruptcy filing last December 22. NECC lawyers supposedly said the company “intended to do the right thing.”
Exactly a month later, January 22, 2013, AP published another report. This account detailed actions NECC shareholders took prior to filing bankruptcy.
Financial records indicate that cost of sales was only about half of revenue generated. NECC sales went from $20 million in 2010 to $32 million in 2012. The company had closed by the time the 4th quarter of 2012 had rolled around. NECC shoveled in the $32 million in just nine months.
What to do with all that cash?
NECC ownership is in the hands of four family members who also served as corporate directors. Profits needed distributing. Carla Conigliaro, largest shareholder, grabbed $8.7 million between late December, 2011 and late November, 2012. Three of Carla’s relatives awarded themselves another $8 million combined.
Such a tragedy could repeat. What NECC did is not unusual, except for killing so many people. A drug may not be on the market to cure an ailment or cause it to regress, but the solution exists. A pharmacy compounds a single dose for one patient. Sometimes the compounded prescription works and – by word of mouth and other means – word about the results spreads.
Soon doctors are sending in prescriptions since one is always needed. Some rogue health care providers stockpile dosages by using the telephone directory to fabricate prescriptions.
So Dick, are you telling us that the Democratic Senate has passed the improved regulatory measures and the Republican house has not? Are you telling us that sans regulations the FDA cannot call a press conference and warn us? That we must have more regulations before people can speak up? Are you telling us that given the multitude of preventable deaths among the 320 plus million of us that these 47 people are the most valuable and should go to the top of the list? We can connect dots too.