By Shelley Murphy, Globe Staff, 8/3/2002

In a ploy to get the Lahey Clinic to prescribe more of its prostate cancer-fighting drug, a major pharmaceutical company ran a contest giving a $250 gift certificate to the doctor or nurse who converted the most patients to an increased dose of the powerful drug, according to a federal indictment.

A clinic doctor reported back to a sales representative from the Illinois-based company, TAP Pharmaceutical Products, that nurses were ''killing each other'' to win the 1998 competition and noted, ''Sounds like this program is working for you,'' the indictment said.

Earlier, TAP's sales manager for Massachusetts, Rita Jokiaho, had warned a sales representative not to post details of the Lahey Clinic contest where a drug competitor could see it because offering a cash incentive to switch a patient from one dose to another could be considered a bribe so ''please please please be cautious how excited we get about this program,'' according to a company document.

Details of TAP's secret inducements to persuade doctors at Lahey Clinic and throughout the country to boost sales of Lupron are alleged in the indictment, filed recently against 12 current and former high-ranking TAP officials.

While neither Burlington-based Lahey Clinic nor any of its doctors are charged in the indictment, a federal investigation is focusing on allegations involving clinic employees, according to federal officials who spoke on the condition of anonymity. The indictment doesn't identify the clinic by name, only as ''LF,'' but federal officials confirmed the references are to Lahey Clinic.

The case offers a window on the increasingly tight relationships between major hospitals and drug companies, in which companies seek to win doctors' favors with free dinners, tickets to sporting events, and contributions to pet projects.

The indictment, filed in Boston on July 16, comes amid increased scrutiny of those relationships.

The most recent case alleges that TAP officials offered free drug samples, cash grants, and other incentives to persuade doctors at Lahey and unspecified other hospitals around the country to prescribe Lupron, instead of a cheaper drug marketed by a rival company. Some doctors allegedly failed to reveal that the drugs were free and later billed Medicare, state Medicaid systems, and patients for the doses. The case does not allege which hospitals engaged in the Medicare fraud.

Jokiaho, the TAP Massachusetts sales manager, is charged with giving kickbacks, bribes, and rebates to doctors and other employees at the Lahey Clinic, including 50 free samples of Lupron and money for golf outings, a Christmas party, and a celebrity night at the Celtics.

The indictment alleges that TAP officials paid a total of $63,000 in ''inducements'' to the Lahey Clinic in 1997 and 1998 to keep doctors from switching from Lupron to Zoladex, which cost patients and their insurance companies more than $100 less for a monthly dose.

The payments were made after clinic officials told TAP that if the company could save the clinic an additional $100,000 through a ''combination of straight pricing and grants-added value service,'' it would ''keep them happy,'' according to the indictment.

Among the incentives given to Lahey to prescribe more Lupron, according to the indictment, were:

A $2,000 grant to a clinic executive in November 1997. The executive chose to use it not for medical care but ''for an attending/resident holiday party at L'Espalier.'' The sales rep said she had called around and ''everyone was booked,'' except another posh Boston restaurant, Grill 23.

A free trip to a ski or golf resort to a Lahey Clinic doctor, courtesy of TAP, in 1998 to ''increase his loyalty and utilization.''

A $500 speaking fee to a Lahey doctor ''to continue building our case.''

A $20,000 golf outing in 1997 and another $18,000 for an outing the following year.

50 free, one-month samples of Lupron to the Lahey Clinic pharmacy. TAP allegedly ''hid the delivery'' by getting four doctors to sign for them.

Joseph Healy, a senior vice president at the Lahey Clinic, declined to comment on the allegations and said the clinic's chief executive officer was unavailable because he's on vacation.

''It's an indictment, it's not a statement of fact,'' Healy said. ''We've received some inquiries from government officials and we're responding to those inquiries.''

The indictment comes on the heels of a record $885 million settlement that TAP paid last year to resolve federal allegations that it inflated the price of Lupron, the top-selling prostate cancer drug. As part of that agreement, TAP agreed to turn over internal documents to federal prosecutors.

Medical ethicists, who have become increasingly alarmed at the tactics used by drug companies to woo doctors, said this latest indictment is reflective of a much larger problem.

''Instead of patients being prescribed the safest, most effective, least expensive drugs, the prescribing decision is distorted by golf, money, and other kinds of inducements by those doctors who are willing to be bribed,'' said Sidney Wolfe, a physician and director of Public Citizen Health Research Group in Washington.

Wolfe said it's illegal for doctors to accept anything of value in exchange for prescribing a particular drug.

If prosecutors can prove that a doctor or nurse practitioner prescribed a drug in exchange for cash or other gratuities, they could prosecute the case under the so-called antikickback statute that applies to Medicare or Medicaid fraud.

And although it's not illegal for doctors to accept invitations to drug company-sponsored golf outings, it's an ethics violation, according to Wolfe.

The TAP employees named in the indictment have all been placed on administrative leave, according to a spokesman for the company.

In a statement released after the indictment, TAP said, ''Like all Americans, they are entitled to the presumption of innocence.''

The company also said, ''TAP has taken strong action to ensure that our business practices are highy ethical and meet both the letter and spirit of the law.''

The Boston indictment alleges that other drug companies were also offering illegal incentives to persuade doctors to prescribe their drugs.

The indictment also alleges that a TAP official paid $5,000 to an unidentified California urologist to get him to persuade the hospital where he worked to prescribe Prevacid, an antacid manufactured by TAP.

But the doctor was ''furious'' at the paltry gift and demanded more money, claiming that one of TAP's competitors had paid more than $130,000 to a customer, according to the indictment.

A TAP sales manager later warned his superiors, according to the indictment, that that if ''TAP wants to stay in the league with the big boys we need to have the funds to do so.''

This story ran on page A1 of the Boston Globe on 8/3/2002.
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