[Ip-health] FW: Gilead Gets Subpoena From Justice Department

Edward Silverman ed.silverman at ubm.com
Sat Jun 18 09:46:30 PDT 2011


If it's not too much to ask, what you mind giving credit to Pharmalot, which is where this first ran....

http://www.pharmalot.com/2011/06/gilead-gets-subpoena-from-justice-department/

Ed Silverman
editor
Pharmalot

-----Original Message-----
From: ip-health-bounces at lists.keionline.org [mailto:ip-health-bounces at lists.keionline.org] On Behalf Of Tahir Amin
Sent: Saturday, June 18, 2011 12:17 PM
To: ip-health at lists.keionline.org
Subject: [Ip-health] Gilead Gets Subpoena From Justice Department

The leading maker of drugs for AIDS and HIV has received a subpoena for
documents related to its manufacture, quality and distribution practices
from the US Attorney for the Northern District of California, according to a
filing with the US Securities and Exchange Commission.

The request applies to Atripla, Emtriva, Truvada and Viread - all of which
are AIDS drugs - as well as the Hepsera hepatitis treatment; the Leitairis
pulmonary hypertension med and an experimental fixed-dose combination of
Truvada and Edurant. The drugmaker says it is cooperating in the civil and
criminal investigation (see the SEC
filing<http://www.sec.gov/Archives/edgar/data/882095/000129993311001765/exhibit1.htm>
).

In a note to investors, ISI Group biotech analyst Mark Schoenebaum noted
that Gilead has received similar subpoenas in the past - in December 2006,
concerning marketing and medical education programs for Truvada, Viread and
Emtriva; and in 2009, for sales and marketing of Ranexa. However, he pointed
out that both investigations were resolved without any penalty.

"...It will likely take years for full resolution (although Gilead says timing
of resolution is unclear at this point), and the worst-case outcome is
likely a fine (which could be substantial, depending on the outcome)," he
writes. "We have no opinion, at this point, about the merits of the
government's case, so we can't opine on the probability of a fine at this
point."

*UPDATE on Sunday, June 12*: Schoenebaum circulated another note over the
weekend to point out that, unlike the current investigation, the previous
probes were "not criminal in nature or related to manufacturing." Although
he add that Gilead informed him the current probe is not related to its San
Dimas, California, facility that was the recent focus of an FDA 483
inspection report and is also involved in the fill/finish process in all of
the drugs cited in the subpoena.

"While the 'manufacturing' language in the press release does not
necessarily indicate that Gilead will have manufacturing interruptions, we
cannot completely rule out this option...For now the company has not been
willing to quantify or qualify the extent to which their operations may (or
may not) be interrupted. Friday's press release mentions many of GILD's
products including its two largest, Atripla and Truvada which make up about
90 percent of its revenues, so this is concerning, but this may be largely
overblown."

He anticipates that if a fine is paid it would total somewhere between $200
million and $750 million.


--
Tahir Amin
Co-Founder and Director of IP
Initiative for Medicines, Access & Knowledge (I-MAK)
Email: tahir at i-mak.org
www.i-mak.org
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