The Martha Stewart Case: Who Was the Real Culprit?

Remember the Martha trial? Not the one she's embroiled in now between Macy's and JC Penney, but the one involving the stock exchange in 2004. As the child of a longtime Martha fan, I remember the drama, the jumpsuit, even the fact that they had to remove a long-standing feature in her magazine ("Martha's schedule") when she went to jail.



But few people may realize how closely connected the FDA was to the Martha Stewart case. Stewart held stock in the company Imclone, which produces the cancer drug Erbitux. She sold her stock in 2001 on the advice of her broker, who recommended she sell because the founder of Imclone and his daughter had also sold. The stock quickly crashed and the furor over insider trading began.

Why did Sam Waksal, Imclone's founder, sell stock in his own company? Because the FDA threatened to withhold approval from Erbitux.

As this story from CNN mentions:

 "Stewart avoided a loss of [$45,673]  by selling nearly 4,000 shares of ImClone stock on Dec. 27, 2001, rather than the next trading day, when the stock tumbled after regulators rejected the company's application for a key cancer drug. "

 In other words, the FDA was the key player in this scandal. The same article goes on to state:

"Ironically, Erbitux, the ImClone drug at the heart of the scandal, was approved by regulators last month [February 2004] to treat certain forms of cancer."

A few days ago, I mentioned the inefficacy of the FDA as far as keeping safe, effective drugs on the market is concerned. In the Martha Stewart case, however, we are faced with a different problem. What happens when the FDA delays approving a perfectly safe drug?

In the first FDA Monitor post, I asked about the cost of FDA approval. In Stewart's case, it cost several hundred thousand dollars in fees, penalties and disgorgement, well over what she saved from selling her stock. But what about the people whose lives may have been saved had the FDA not waited so long to approve Erbitux? When Stewart and Waksal sold, Erbitux was considered safe, but the FDA wanted to run more tests to assess its effectiveness. In other words, individuals who had tried Erbitux had either been treated successfully, or had gone on to try something else. It didn't kill anyone. Not to be melodramatic, but money, lives and reputations were lost because of the FDA.

What do you think? Was the FDA approval worth it?

My guess is she thinks not.

Throwbacks to the 80s... and 50s

They thought they had left it behind, too...

I was in the car yesterday when I heard this intriguing tidbit on the radio:

FDA approves Diclegis for pregnant women experiencing nausea and vomiting

Okay, maybe not so intriguing, unless you happen to be suffering from acute morning sickness, which I am not. But as the mastermind behind the FDA Monitor, I felt compelled to check it out. What I found was actually quite interesting.

You wouldn't pick this up from the FDA promotion, but Diclegis, the newly approved nausea medicine, is actually just a re-branded version of Bendectin, a nausea medication that was pulled from the market in 1983.

In other words, women were unnecessarily subjected to THIRTY YEARS of discomfort and illness. As the drug company now producing Diclegis proudly states, it is the only FDA approved medicine for morning sickness.

And it was originally approved in 1956.

So what happened? As this New York Times article from 1983 explains, a "shadow of doubt" wiped out Bendectin. Fear fostered by media and overly litigious lawyers made it impossible for the drug company producing Bendectin to defend itself in court and keep Bendectin on the market. So not only were they forced to undergo the complex, exacting, expensive procedure of gaining FDA approval, the approval did not protect them in the marketplace.

But now we have it back again. Perhaps the shadow of doubt was erased over the last thirty years. But it is clear that the FDA did not protect women from morning sickness for the past three decades. Do lawsuits perhaps protect consumers more comprehensively than the FDA? In any case, why do we need both? I am curious to hear your thoughts on the issue.

Throwbacks to the 1980s... and 50s?

I was in the car yesterday when I heard this intriguing tidbit on the radio:

FDA approves Diclegis for pregnant women experiencing nausea and vomiting

 

Okay, maybe not so intriguing, unless you happen to be suffering from acute morning sickness, which I am not. But as the mastermind behind the FDA Monitor, I felt compelled to check it out. And what I found was actually quite interesting.

You wouldn't pick this up from the FDA article, but Diclegis, the newly approved nausea medicine, is actually just a re-branded version of Bendectin, a nausea medication that was pulled from the market in 1983.


In other words, women were unnecessarily subjected to THIRTY YEARS of discomfort and illness. As the drug company now producing Diclegis proudly states, it is the only FDA approved medicine for morning sickness.

And it was originally approved in 1956.

So what happened? As this New York Times article from 1983 explains, a "shadow of doubt" wiped out Bendectin. Fear fostered by media and overly litigious lawyers made it impossible for the drug company producing Bendectin to defend itself in court and keep Bendectin on the market. So not only were they forced to undergo the complex, exacting, expensive procedure of gaining FDA approval, the approval did not protect them in the marketplace.

But now we have it back again. Perhaps the shadow of doubt was erased over the last thirty years. But it is clear that the FDA did not protect women from morning sickness for the past thirty years. Do lawsuits perhaps protect consumers more comprehensively than the FDA? In any case, why do we need both? I am curious to hear your thoughts on the issue.

They thought the 80s were behind them, too:)

What do those three little letters say to you?

I was first introduced to the FDA by Macaulay Culkin in Home Alone, when he asked a bewildered salesgirl if a toothbrush at her store was FDA-approved. But no FDA approval could save him from this:













 BURN!!! Click image for the video!

So what is the role of the Food and Drug Administration, which has a budget of $4,486,368,000 for 2013 alone? Like many governmental organizations, the FDA claims it wants to protect the public. On their website, they provide a laundry list of things they seek to shield us from. In their own words:

"The FDA is responsible for

• Protecting the public health by assuring that foods are safe, wholesome, sanitary and properly labeled; human and veterinary drugs, and vaccines and other biological products and medical devices intended for human use are safe and effective
• Protecting the public from electronic product radiation
• Assuring cosmetics and dietary supplements are safe and properly labeled
• Regulating tobacco products
• Advancing the public health by helping to speed product innovations
• Helping the public get the accurate science-based information they need to use medicines, devices, and foods to improve their health

FDA’s responsibilities extend to the 50 United States, the District of Columbia, Puerto Rico, Guam, the Virgin Islands, American Samoa, and other U.S. territories and possessions."

If you are like me, the above list might sound great. I would love to not be harmed by electronic product radiation or contaminated mascara. I am also not opposed to speedy product innovations that can "advance the public health." But I also know that there are profound problems with the American medical system, ranging from high costs to long waits. In all the debate about nationalized healthcare, the FDA never took central stage. Its authority remains virtually untouched. Yet it is an inextricable component of American healthcare. What is the price of their protection- in time, efficiency, and money? That is what this blog will seek to examine and shed light on. Welcome to the FDA Monitor.