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September 23, 2014   Download print version

Glaxo’s China fine signals no immunity for multinationals

Streets bustling after Sierra Leone shutdown ends

WHO experts advise against travel or trade bans on Ebola-hit Africa

Obama hits at companies moving overseas to avoid taxes

After surgery, surprise $117,000 medical bill from doctor he didn’t know

Inventor Dr. Jeffrey L. Deal from TRU-D, to participate in Center for Global Health and Diplomacy Panel discussing Ebola

Allosource signs Space Act Agreement with NASA and Jet Propulsion Laboratory

Ranbaxy faces Medicaid pricing probe by the Justice Department


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Glaxo’s China fine signals no immunity for multinationals

China’s decision to impose a record fine on GlaxoSmithKline Plc signals that even the largest multinationals may not get off lightly in government investigations in Asia’s largest economy.

China on Sept. 19 fined Glaxo almost $500 million after a bribery investigation that had lasted almost 15 months and fueled declines in the pharmaceutical company’s local sales.

The Glaxo ruling comes after a spate of Chinese antitrust investigations into global companies have drawn protests from international trade groups, who warned that the scrutiny could undermine the country’s appeal. The fine is a setback for Glaxo in China and shows the need for multinationals to ensure that business practices conform to the Chinese legal system, said James Roy, associate principal at China Market Research Group in Shanghai.

The Intermediate People’s Court in the city of Changsha in Hunan Province imposed the fine on Glaxo for bribing non-government personnel, the U.K. drugmaker said in a statement. It published an apology to China’s government and pledged to reform its practices.

China is widening graft investigations after President Xi Jinping warned that corruption threatens the Communist Party’s six-decade hold on power. Xi’s anti-corruption campaign has snared thousands of party officials of all levels. In July former security chief and politburo Standing Committee member Zhou Yongkang was taken down and in June the campaign claimed Xu Caihou, a former vice chairman of the Central Military Commission, the country’s highest military body.

Foreign companies are still unlikely to be deterred from investing and will focus on the potential to make profits in China when making their decisions, Roy said.

While the Glaxo case will be a “factor” in how multinationals view China, their decisions to make investments in the country will be driven mainly by the ability to make profits, he said. “You’re still seeing continued investments from foreign companies -- it’s dropping but the ones that are successful here are continuing to invest and open up new facilities.”

Visit Bloomberg for the full report.



Streets bustling after Sierra Leone shutdown ends

Streets in Sierra Leone's capital bustled again Monday after an unprecedented nationwide shutdown during which officials said more than 1 million households were checked for Ebola patients and given information on the deadly disease.

But it remained unclear if the three-day effort would help curb the spread of a disease that is blamed for the deaths of more than 2,600 people in West Africa. Authorities have not yet said how many new suspected cases were discovered over the three days, but at least 71 bodies were buried during the shutdown.

Joe Amon, director of health and human rights for Human Rights Watch, said there was little reason to believe the lockdown had been effective in ending transmission since such measures are so hard to enforce.

Teams carrying soap and information about Ebola reached about 75 percent of 1.5 million households in this nation, the health ministry said. Some residents complained of food shortages, as others sat out on verandas. Rumors that the soap being distributed had been poisoned called into question the education efforts.

More than 560 people are believed to have died from the dreaded disease in Sierra Leone, a nation of 6 million people. Ebola has also spread rampantly through Liberia and Guinea and a limited number of cases have been reported in Nigeria and one in Senegal.

Treatment centers are overwhelmed with patients almost as soon as they're built and health workers struggle to keep up with monitoring the contacts of thousands of sick people. So the hardest hit countries have resorted to extraordinary measures. Liberia has cordoned off entire towns or neighborhoods, and Sierra Leone's nationwide shutdown was a first.

The World Health Organization has not said clearly whether it supports such measures, saying they should only be undertaken if people's rights are protected and the measures are proportionate and evidence-based. But so much in this outbreak is new — from its large geographic spread to the number of people infected to the government response — that evidence on the best way to contain it is scarce.

The U.N. health agency has, however, repeatedly said that the border closures and flight bans many countries have put in place to protect themselves from Ebola are counterproductive. It reiterated on Monday that such restrictions are hindering "relief and response efforts, risking further international spread."

Later Monday, Sierra Leone officials are expected to announce how many cases of Ebola were found during the three-day shutdown and how many dead were discovered. The government has ordered tents for temporary treatment centers to make room for any new cases discovered, said Abdulai Bayraytay, a government spokesman.

The scale of the outbreak — Ebola is believed to have infected more than 5,500 people — has strained the resources of countries with poor health systems in the best of times. Liberia, which has been hardest hit by the disease, opened its largest Ebola clinic to date on Sunday.

No sooner had the ceremony to open the 150-bed center ended than ambulances rushed there with patients. Because there are too few beds to treat patients and too few ambulances to pick them up, people wait hours or even days before being taken to hospitals. Ambulances are often packed with several patients, said William Ross, a first responder in Monrovia, and many die on the way to the hospital.

The outbreak has also suffered from a lack of doctors and nurses trained to treat Ebola patients, numbers that have been further depleted by the unprecedented number of infections in health workers. More than 300 have been infected, and about half of those have died. A Spanish priest who became infected while serving as a medical director for a hospital in Sierra Leone was flown back to Spain on Monday. (Associated Press) Visit the Houston Chronicle for the article.



WHO experts advise against travel or trade bans on Ebola-hit Africa

Independent health advisers to the World Health Organization (WHO) have assessed that there should be no general ban on travel or trade with countries reeling from an Ebola epidemic in West Africa, the U.N. agency said on Monday.

Some airlines have stopped flights to affected areas and WHO and other agencies have said this has hampered aid efforts and the ability of experts to reach victims of the world's worst ever outbreak of the hemorrhagic fever.

In a statement issued after the Emergency Committee held its second meeting last week, the WHO said Ebola had now killed at least 2,793 people in five countries and remains a "public health emergency of international concern".

"Flight cancellations and other travel restrictions continue to isolate affected countries, resulting in detrimental economic consequences, and hinder relief and response efforts risking further international spread," the statement said. "The Committee strongly reiterated that there should be no general ban on international travel or trade..."

The experts urged authorities in the affected countries - Guinea, Liberia, Nigeria, Senegal and Sierra Leone - to work with the aviation and maritime sectors to resolve differences and "develop a coordinated response" to transport issues.

Quarantines may be deemed necessary in areas of intense and widespread transmission of the deadly Ebola virus, the committee statement went on.

"States should ensure that they are proportionate and evidence-based and that accurate information, essential services and commodities, including food and water, are provided to the affected populations."

WHO advisers earlier recommended the screening of travellers departing Ebola-affected countries from airports and ports.

The committee, composed of some 20 experts who advise WHO Director-General Margaret Chan, declared on Aug. 8 that the epidemic constituted a public health emergency of international concern. The medical charity Medecins Sans Frontieres has warned since late March that the outbreak, which began in the remote Gueckedou area of southeastern Guinea, is "unprecedented".

Sierra Leoneans on Sunday celebrated the end of a three-day lockdown meant to stem Ebola's reach, with authorities saying the move had identified dozens of new infections and located scores of bodies.

Separately on Monday, the WHO said two of the five affected countries - Nigeria and Senegal - were managing to halt the spread of the disease. Visit Reuters for the story.



Obama hits at companies moving overseas to avoid taxes

The Obama administration took action Monday to discourage corporations from moving their headquarters abroad to avoid U.S. taxes, announcing new rules designed to make such transactions significantly less profitable. The rules, which take effect immediately, will make it harder for U.S. firms to bring cash earned abroad back to the United States tax-free and to take advantage of other benefits of foreign relocation.

But the rules would not block the practice, known as tax “inversion,” and Treasury Secretary Jack Lew again called on Congress to enact more far-reaching reforms.

“These first, targeted steps make substantial progress in constraining the creative techniques used to avoid U.S. taxes, both in terms of meaningfully reducing the economic benefits of inversions after the fact, and when possible, stopping them altogether,” Lew said in a written statement. Visit the Washington Post for the report.



After surgery, surprise $117,000 medical bill from doctor he didn’t know

Before his three-hour neck surgery for herniated disks in December, Peter Drier, 37, signed a pile of consent forms. A bank technology manager who had researched his insurance coverage, Drier was prepared when the bills started arriving: $56,000 from Lenox Hill Hospital in Manhattan, $4,300 from the anesthesiologist and even $133,000 from his orthopedist, who he knew would accept a fraction of that fee.

He was blindsided, though, by a bill of about $117,000 from an “assistant surgeon,” a Queens-based neurosurgeon whom Drier did not recall meeting.

In operating rooms and on hospital wards across the country, physicians and other health providers typically help one another in patient care. But in an increasingly common practice that some medical experts call drive-by doctoring, assistants, consultants and other hospital employees are charging patients or their insurers hefty fees. They may be called in when the need for them is questionable. And patients usually do not realize they have been involved or are charging until the bill arrives.

The practice increases revenue for physicians and other healthcare workers at a time when insurers are cutting down reimbursement for many services. The surprise charges can be especially significant because, as in Drier’s case, they may involve out-of-network providers who bill 20 to 40 times the usual local rates and often collect the full amount, or a substantial portion.

“The notion is you can make end runs around price controls by increasing the number of things you do and bill for,” said Dr. Darshak Sanghavi, a health policy expert at the Brookings Institution until recently. This contributes to the nation’s $2.8 trillion in annual health costs.

Insurers, saying the surprise charges have proliferated, have filed lawsuits challenging them. In recent years, unexpected out-of-network charges have become the top complaint to the New York State agency that regulates insurance companies. Multiple state health insurance commissioners have tried to limit patients’ liability, but lobbying by the health care industry sometimes stymies their efforts.

In Drier’s case, the primary surgeon, Dr. Nathaniel L. Tindel, had said he would accept a negotiated fee determined through Drier’s insurance company, which ended up being about $6,200. (Drier had to pay $3,000 of that to meet his deductible.) But the assistant, Dr. Harrison T. Mu, was out of network and sent the $117,000 bill. Insurance experts say surgeons and assistants sometimes share proceeds from operations, but Dr. Tindel’s office says he and Dr. Mu do not.

The phenomenon can take many forms. In some instances, a patient may be lying on a gurney in the emergency room or in a hospital bed, unaware that all of the people in white coats or scrubs who turn up at the bedside will charge for their services. At times, a fully trained physician is called in when a resident or a nurse, who would not charge, would have sufficed. Services that were once included in the daily hospital rate are now often provided by contractors, and even many emergency rooms are staffed by out-of-network physicians who bill separately.

When insurers intervene in a particular case, they say they have limited ability to fight back. Insurance examiners “are not in the room on the day of surgery to see the second surgeon walk into the room or why they were needed,” said Clare Krusing, a spokeswoman for America’s Health Insurance Plans, an industry group. And current laws do not require hospitals that join an insurance network to provide in-network doctors, labs or X-rays, for example.

When out-of-network physicians perform hospital procedures, hefty charges can be added to medical bills. Insurers often pay the full amount or large portions, which provides an incentive for doctors to include out-of-network colleagues.

So sometimes insurers just pay — to protect their customers, they say — which encourages the practice. When Drier complained to his insurer, Anthem Blue Cross Blue Shield, that he should not have to pay the out-of-network assistant surgeon, Anthem agreed it was not his responsibility. Instead, the company cut a check to Dr. Mu for $116,862, the full amount.

The rate of spinal surgery in the United States is about twice that in Europe and Canada, and five times that in Britain, said Dr. Richard A. Deyo of Oregon Health and Science University, who studies international comparisons. Studies are limited but have generally concluded that after two years, patients who have surgery for disk problems do no better than those treated with painkillers and physical therapy — although the pain, which can be debilitating, resolves far more rapidly with surgery.

The United States has more neurosurgeons per capita than almost any other developed country, and they compete with orthopedists for spinal surgery. At the same time, Medicare and private insurers have reduced payments to surgeons. The average base salary for neurosurgeons decreased to $590,000 in 2014 from $630,000 in 2010, according to Merritt Hawkins, a physician staffing firm.

To counter that trend, some spinal surgeons have turned to consultants — including a Long Island company called Business Dynamics RCM and a subsidiary, the Business of Spine — that offer advice on how to increase revenue through “innovative” coding, claim generation and collection services.

Some strategies used by surgeons, including billing large amounts for a second surgeon in the room or declaring an operation an emergency, raise serious questions. The indications for immediate spinal surgery, such as loss of bladder function or rapidly progressive paralysis, are rare. But insurers are more likely to reimburse a hospital or surgeon with whom they do not have a contract if a case is labeled an emergency.

Drier’s concern about extra charges began even during his preoperative physical. The hospital sent his blood tests to an out-of-network lab and required him to have an echocardiogram (eventually billed for $950), even though he had no cardiac history. His worries escalated as he lay prepped for the operating room on the morning of his surgery. A technician from a company called Intraoperative Monitoring Service L.L.C. asked him to sign a financial consent form, noting that the company did not accept Blue Cross Blue Shield plans, so he would be required to pay the bill himself. The monitoring had been ordered by his surgeon and is considered essential for the type of neurosurgery he was having, to make sure delicate nerves are not damaged as they are manipulated.

In the operating room, he underwent a procedure called spinal fusion, in which the surgeons removed two herniated disks that were impinging on nerves, and inserted some bone graft as well as plates and screws to stabilize the spine. On his hospital bill, Mr. Drier noted charges for three implants, a total of about $10,400, as well as for two surgical screws billed at $2,470 and $3,990 — expensive for hardware, he thought, but his insurer paid the full amount.

The biggest surprise was the bill from Dr. Mu, the assistant surgeon. Fusions generally require a second trained pair of hands, but those can be provided by a resident or a neurosurgical nurse or physician assistant employed by the hospital, for whom there is no additional charge. The operative record for Drier’s surgery states that no qualified resident was available.

In Drier’s case, each surgeon billed for each step of the procedure. Dr. Tindel billed $74,000 for removing two disks and an additional $50,000 for placing the hardware that stabilized Drier’s spine. Dr. Mu billed $67,000 and $50,000 for those tasks.

If the surgery had been for a Medicare patient, the assistant would have been permitted to bill only 16 percent of the primary surgeon’s fee. With current Medicare rates, that would have been about $800, less than 1 percent of what Dr. Mu was paid.

Unexpected fees are routinely generated outside the operating room as well. On the wards, a dermatologist may be called in to examine a rash and perform an expensive biopsy. The person in scrubs who walks a patient to a bathroom for the first time after hip surgery may turn out to be a physical therapist billing $400.

Dr. Abeel A. Mangi, a Yale cardiac surgeon, said hospitals often encouraged extra visits for both billing and legal reasons. He said he was required to request a physical therapy consult before each discharge, for example, even if he felt there was no need.

Drier tried to negotiate with the surgeons to divvy up the $117,000 payment in a way he believed was more fair; he liked Dr. Tindel and felt he was being underpaid. Drier’s idea, he wrote in an email, was to settle on “a reasonable fee for both the surgeon and assistant and return the rest of the check to the insurance company/employees” of his company. But in July, he received a threatening letter from Dr. Mu’s lawyer noting that he had failed to forward the $117,000 check. So he sent it along, with regret. Visit the New York Times for the story.



Inventor Dr. Jeffrey L. Deal from TRU-D, to participate in Center for Global Health and Diplomacy Panel discussing Ebola

On Sept. 23, Dr. Jeffrey L. Deal, inventor of TRU-D SmartUVC, an automated room decontamination device used to eliminate pathogens in health care settings, will participate as a panelist in a special session on "Mobilizing a United Corporate and Communications Response to Contain Ebola" as part of the Center for Global Health and Diplomacy's (GHD) Conference on Creating a Post-2015 Infrastructure for Development: Challenges, Successes and Suggestion for the Future. The purpose of the session is to discuss innovative strategies for the containment of the Ebola virus outbreak in West Africa.

Deal recently returned from a 10-day mission in Monrovia, Liberia, where he installed two TRU-D robots, donated by TRU-D SmartUVC LLC, in the Ebola Treatment Units at JFK and ELWA Hospitals. As a part of the Ebola Task Force, which also included teams from WHO, the CDC, Doctors Without Borders, UNICEF and the World Food Programme, Deal worked with many others involved in the international aid effort while in Liberia. He will join principals from the CDC Foundation, the UN Foundation and other global health and political organizations on the CGHD conference panel to share his experiences in the debate on the international community's current ability to control the epidemic.

His Excellency Alpha Conde, President of the Republic of Guinea, will lead the session with a keynote address. After the session concludes, Deal, along with representatives from TRU-D SmartUVC LLC and other session attendees will be a part of the NASDAQ closing bell ceremony, where every dollar donated during that time will be given to the CDC Foundation to support national and international organizations working to contain Ebola.  

TRU-D, short for Total Room Ultraviolet Disinfector, was the first automated room decontamination system to be used in Africa, and the two devices are still aiding in the battle against the Ebola virus outbreak. The device works by using UV-C light energy – generated during a single cycle from a single, central location in the room – to modify the DNA structure of pathogens in the room, like Ebola, so that they cannot reproduce. Viruses, bacteria and spores that cannot reproduce cannot colonize and harm patients.

Both TRU-D units in Liberia were previously released from a 28-month-long CDC-funded study conducted by the Duke University Prevention Epicenter Program, the most comprehensive evaluation of the real-world application of UV-C disinfection to date.

Deal currently serves as director of health studies for Water Missions International, a nonprofit Christian engineering organization providing sustainable safe water and sanitation solutions for people in developing countries and disaster areas. deal holds an anthropology degree, medical degree, board certifications and three post-doctoral fellowships and has had a long and distinguished medical career including 30 years as a clinical instructor at MUSC. His passion for tropical medicine led him to spend time establishing and working in medical facilities in locations around the world such as South Sudan, Darfur and finally Tanzania.

For information and links to independent studies on TRU-D, visit



Allosource signs Space Act Agreement with NASA and Jet Propulsion Laboratory

AlloSource, one of the nation’s largest providers of skin, bone and soft tissue allografts for use in surgical procedures, and the world’s largest processor of cellular bone allografts, signed a Space Act Agreement with National Aeronautics and Space Administration (NASA) and the Jet Propulsion Laboratory (JPL) to collaborate on microbial research.

AlloSource will leverage technologies developed by NASA/JPL for assembly and launch operations of various Mars missions --specifically, rapid molecular microbial burden measurement and genetic inventory cataloging -- to advance microbial research in tissue processing.

Manufacturer’s Edge, formerly the Colorado Association for Manufacturing and Technology (CAMT), and NASA are partners on a technology matching and product development assistance program to help Colorado companies use NASA resources to spur innovation for new products and processes. AlloSource’s participation in the Manufacturer’s Edge program led to this unique collaboration. JPL, a division of the California Institute of Technology, is the NASA center that manages the Curiosity Rover mission, which focuses on assessing a local region on Mars’ surface as a potential habitat for past life.

The molecular microbial detection technology used in the rigorous pre- and post-mission testing of the Mars mission spacecraft components provides an opportunity for AlloSource to evolve microbial testing on donated tissue. In order for tissue to be safe and suitable for transplant, an array of intense, specialized scientific testing is required. Tissue is subjected to microbiological testing at recovery and must be free of specific microorganisms and contaminants that would preclude tissue from processing or transplantation.

Additional post-processing testing is also required before the tissue is transplantable. NASA, JPL and AlloSource will share ideas and processes related to microbiological testing methods and will look for new ways to rapidly detect the presence of microorganisms. Visit Allosource for the release.



Ranbaxy faces Medicaid pricing probe by the Justice Department

Manufacturing woes are not the only issue plaguing Ranbaxy Laboratories. The generic drug maker has been asked by the U.S. Department of Justice to provide documents on pricing data provided to Medicaid, according to a filing with the Bombay Stock Exchange.

Specifically, the filing says the feds sent a civil investigative demand, which Ranbaxy was quick to note is not an allegation of wrongdoing or demand for compensation. In any event, the drug maker indicated it would “fully cooperate with the civil investigation.”

The disclosure comes amid ongoing difficulties Ranbaxy faces with U.S. authorities. Last year, the drug maker paid a $500 million fine to U.S. authorities as part of a settlement that included pleading guilty to two charges of violating drug safety laws. Meanwhile, a consent decree stipulating manufacturing requirements remains in effect and the FDA has banned imports from four plants in India.

Meanwhile, Ranbaxy faces litigation in Texas, where the state attorney general two years ago filed a lawsuit charging the drug maker with violating the state Medicaid Fraud Prevention Act. The lawsuit alleges that Ranbaxy reported false or inflated prices and failed to disclose, or concealed discounts to the state Medicaid program.

Last month, Ranbaxy set aside about $40 million for an unspecified charge, although The Economic Times reported that set aside may have pertained to the Texas litigation, and that the settlement would cover both Medicaid and manufacturing disputes with the government. A spokesman for the Texas attorney general says the case is ongoing but declined further comment. Visit the Wall Street Journal for the report.