PHARMALOT
Senator opens probe into Novartis over its dealings with Trump’s attorney
By ED SILVERMAN @Pharmalot
MAY 11, 2018
A lawmaker is opening an investigation into Novartis for paying $1.2 million to President Trump’s personal attorney, Michael Cohen, in an attempt to gain access to the White House, a disclosure that has prompted widespread criticism of the drug maker.
The company has said it agreed to a one-year contract, beginning in February 2017, with Cohen’s firm, Essential Consultants, in order to create a direct channel to the Trump administration about “health care policy matters.” The arrangement, however, has been widely derided because Cohen is not a lobbyist or an expert in health care matters. And Novartis said it let the contract lapse when it expired.
But in a letter sent Friday to the company, Sen. Ron Wyden (D-Ore.) suggested the payments may have been linked to a groundbreaking Novartis cancer treatment that was being reviewed last year by the Food and Drug Administration. And he also noted the drug maker was holding talks last year with the Centers for Medicare and Medicaid Services about a unique reimbursement deal for the medication.
“At the same time as the payments to Mr. Cohen’s firm were being made, the company’s in-house lobbyists were meeting with the White House, FDA, CMS, and other Trump Administration agencies regarding a range of issues that could dramatically affect its business,” Wyden, the ranking Democrat on the Senate Finance Committee, wrote to Novartis chief executive Vas Narasimhan.
During this time, he noted, Cohen was paid “while the company was negotiating novel payment arrangements” for the medicine, a CAR-T therapy called Kymriah that costs $475,000. The FDA approved the medicine to treat a form of leukemia last August, but Wyden pointed out that “Novartis also was negotiating with CMS regarding how federal health programs would pay for the drug.”
STAT PLUS
Access to exclusive, in-depth pharma, biotech, business and policy coverage. Join now.
A Novartis spokesman wrote us that “we anticipated this letter which we just received and plan to fully cooperate.”
Ultimately, Novartis offered the federal government a money-back guarantee — or outcomes-based contrast in industry parlance — in which there will be no charge to Medicare if a patient fails to respond in 30 days. The same deal was offered to private insurers.
“In the company’s words, in its negotiations with CMS it was seeking to ‘[improve] efficiencies in current regulatory requirements in order to deliver value-based care and ensure access,’ “his letter continued. “CMS, for its part, stated that it was seeking to ‘identify and alleviate regulatory barriers in Medicare and Medicaid as may be necessary to test payment and service delivery models.’”
And so Wyden asked Novartis to provide copies of all correspondence with Cohen and his firm, as well as details of the payments and the contract. He also wants the company to cough up internal communications concerning Cohen, along with external communications with lobbyists, the White House and other government agencies concerning Cohen.
Cohen could not be reached for comment.
To what extent Kymriah was a major factor into the thinking at Novartis remains to be seen. Like other drug makers, the company was concerned about the many new and unknown faces in the Trump administration early last year. And Trump was promising to deep six the Affordable Care Act while also promising to address rising prescription drug prices.
In any event, the contract with Cohen has caused Novartis considerable grief. The company has been harshly criticized for paying him more than the drug maker has typically paid lobbyists, which Wyden also noted. Moreover, the company admitted it was a waste of money after a March 2017 between Cohen and Novartis staff revealed he appeared unsuited to help accomplish their goals.
Beyond the pay-to-play ramifications, the payments have generated anger because the disclosure comes at a time when Americans are increasingly angry over the cost of their medicines.
In an e-mail to employees on Thursday, Narasimhan acknowledged that Wednesday – the day after the Cohen contract was disclosed – was “not a good day for Novartis… We made a mistake entering into this engagement and as a consequence are being criticized by a world that expects more from us… I went to sleep frustrated and tired.”
However, Narasimhan has insisted he had nothing to do with the contract. Novartis spokespeople have maintained the deal was signed by his predecessor, Joe Jimenez, after being approached by Cohen, and that Narasimhan allowed the contract to lapse. Jimenez could not be reached for comment.
The Cohen contract was first disclosed on Tuesday night by Michael Avenatti, the lawyer for Stormy Daniels, the adult film star whose real name is Stephanie Clifford and who was paid $130,000 by Essential Consultants to keep quiet about her alleged affair with Trump. Avenatti initially posted a document on his website indicating Novartis paid Cohen’s firm $400,000 from early 2017 through 2018.
Senator opens probe into Novartis over its dealings with Trump’s attorney
By ED SILVERMAN @Pharmalot
MAY 11, 2018
A lawmaker is opening an investigation into Novartis for paying $1.2 million to President Trump’s personal attorney, Michael Cohen, in an attempt to gain access to the White House, a disclosure that has prompted widespread criticism of the drug maker.
The company has said it agreed to a one-year contract, beginning in February 2017, with Cohen’s firm, Essential Consultants, in order to create a direct channel to the Trump administration about “health care policy matters.” The arrangement, however, has been widely derided because Cohen is not a lobbyist or an expert in health care matters. And Novartis said it let the contract lapse when it expired.
But in a letter sent Friday to the company, Sen. Ron Wyden (D-Ore.) suggested the payments may have been linked to a groundbreaking Novartis cancer treatment that was being reviewed last year by the Food and Drug Administration. And he also noted the drug maker was holding talks last year with the Centers for Medicare and Medicaid Services about a unique reimbursement deal for the medication.
“At the same time as the payments to Mr. Cohen’s firm were being made, the company’s in-house lobbyists were meeting with the White House, FDA, CMS, and other Trump Administration agencies regarding a range of issues that could dramatically affect its business,” Wyden, the ranking Democrat on the Senate Finance Committee, wrote to Novartis chief executive Vas Narasimhan.
During this time, he noted, Cohen was paid “while the company was negotiating novel payment arrangements” for the medicine, a CAR-T therapy called Kymriah that costs $475,000. The FDA approved the medicine to treat a form of leukemia last August, but Wyden pointed out that “Novartis also was negotiating with CMS regarding how federal health programs would pay for the drug.”
STAT PLUS
Access to exclusive, in-depth pharma, biotech, business and policy coverage. Join now.
A Novartis spokesman wrote us that “we anticipated this letter which we just received and plan to fully cooperate.”
Ultimately, Novartis offered the federal government a money-back guarantee — or outcomes-based contrast in industry parlance — in which there will be no charge to Medicare if a patient fails to respond in 30 days. The same deal was offered to private insurers.
“In the company’s words, in its negotiations with CMS it was seeking to ‘[improve] efficiencies in current regulatory requirements in order to deliver value-based care and ensure access,’ “his letter continued. “CMS, for its part, stated that it was seeking to ‘identify and alleviate regulatory barriers in Medicare and Medicaid as may be necessary to test payment and service delivery models.’”
And so Wyden asked Novartis to provide copies of all correspondence with Cohen and his firm, as well as details of the payments and the contract. He also wants the company to cough up internal communications concerning Cohen, along with external communications with lobbyists, the White House and other government agencies concerning Cohen.
Cohen could not be reached for comment.
To what extent Kymriah was a major factor into the thinking at Novartis remains to be seen. Like other drug makers, the company was concerned about the many new and unknown faces in the Trump administration early last year. And Trump was promising to deep six the Affordable Care Act while also promising to address rising prescription drug prices.
In any event, the contract with Cohen has caused Novartis considerable grief. The company has been harshly criticized for paying him more than the drug maker has typically paid lobbyists, which Wyden also noted. Moreover, the company admitted it was a waste of money after a March 2017 between Cohen and Novartis staff revealed he appeared unsuited to help accomplish their goals.
Beyond the pay-to-play ramifications, the payments have generated anger because the disclosure comes at a time when Americans are increasingly angry over the cost of their medicines.
In an e-mail to employees on Thursday, Narasimhan acknowledged that Wednesday – the day after the Cohen contract was disclosed – was “not a good day for Novartis… We made a mistake entering into this engagement and as a consequence are being criticized by a world that expects more from us… I went to sleep frustrated and tired.”
However, Narasimhan has insisted he had nothing to do with the contract. Novartis spokespeople have maintained the deal was signed by his predecessor, Joe Jimenez, after being approached by Cohen, and that Narasimhan allowed the contract to lapse. Jimenez could not be reached for comment.
The Cohen contract was first disclosed on Tuesday night by Michael Avenatti, the lawyer for Stormy Daniels, the adult film star whose real name is Stephanie Clifford and who was paid $130,000 by Essential Consultants to keep quiet about her alleged affair with Trump. Avenatti initially posted a document on his website indicating Novartis paid Cohen’s firm $400,000 from early 2017 through 2018.
