New federal data shine a light on Medtronic payments to doctors
Minnesota device maker has become a flash point in a national debate about the role of money in medicine.
By Joe Carlson and Jim Spencer, Star Tribune staff writers
JULY 11, 2015
New federal data show that Medtronic continues to pay millions of dollars to doctors whose research on a controversial spinal product has come into question.
The Minnesota-run company’s spine division, Medtronic Sofamor Danek, paid $60.7 million in royalties to 79 doctors and their affiliates in 2014, according to the data. That includes money that went to the authors of disputed studies of the back pain treatment Infuse, a product that has sparked hundreds of patient injury lawsuits.
Dr. Ken Burkus, a Georgia surgeon and lead author on six studies that omitted adverse events related to Infuse, got $374,000 in royalties last year. Dr. Regis Haid, an Atlanta neurosurgeon who led one of the studies, got $2.3 million. Payments for both were sent to third-party companies; neither returned calls for comment.
Although Medtronic’s propensity for paying royalties is not unique, the Minnesota device maker has become a flash point in a national debate about the role of money in medicine. Altogether, Medtronic paid $90 million in royalties in 2014, more than any other device company in the country.
“The goal of these kinds of fees is to influence prescribing behavior,” said Dr. Michael Carome, health research director at the consumer advocacy group Public Citizen. The payments are “in the financial interests of the company and the physicians,” he added, “not in the best interest of the patients.”
Medtronic disagrees. Company officials argue that payments to physicians propel innovations that relieve pain and promote healing. “When a new technology is used to improve care and outcomes for a large number of patients, it makes sense for a physician to benefit from their inventive contributions,” Medtronic spokeswoman Cindy Resman said in an e-mail.
Royalties paid for patented and licensed innovations comprise the largest slice of payments to doctors, $800 million last year, according to data released last month under the federal Open Payments program. Seven of the top 10 companies or divisions paying royalties last year sell medical devices for skeletal problems.
One of the most controversial medical products on the market, Medtronic’s bone-growth system Infuse includes a synthetic human protein that has helped tens of thousands of patients overcome serious back pain but left thousands of others claiming they were injured. Medtronic acknowledges risks like unexpected bone growth and sexual dysfunction in men.
Many questions about Infuse center on the credibility of early research, because at least 11 studies that omitted key safety data were written by doctors who were paid millions in royalties from Medtronic.
South Dakota neurosurgeon Dr. Larry Teuber is skeptical that all industry royalties are truly for product development, given the large profits to be made by devicemakers and hospitals on orthopedic surgeries like spinal fusions.
“Remember, the markup on these devices is huge,” said Teuber, who used to run a surgery center in Rapid City. “The reason they pay money is to get these guys to use their implants. Royalties are just another twist in the story.”
Critics ranging from Teuber to the national health insurer Humana say that royalty arrangements can be structured in the orthopedics business to reward doctors for promoting a device or drug, rather than for inventions that substantively improve a product.
In an ongoing federal lawsuit against Medtronic, Humana accuses the company of paying “disguised royalties” to study authors who wrote peer-reviewed journal articles about uses of Infuse not approved by the Food and Drug Administration. Medtronic vociferously denies Humana’s allegations.
Many of the authors named in the 2014 Humana suit were first identified in a 2012 Senate Finance Committee report that criticized what it called biased Infuse research. Those doctors collected more than $11 million in royalties from Medtronic last year.
Resman said royalties are common in the orthopedics world because doctors bring special insight into the sensitive anatomy of the spine.
“These products are often advanced by the physicians who understand the anatomy, approaches, and placement of these technologies,” Resman wrote to the Star Tribune. “These inventive contributions are really part of [research and development] activity that is more unique to spine and orthopedics.”
The scrutiny of Infuse has focused on how Medtronic paid authors and then, according to e-mails released by the Senate Finance Committee in 2012, edited their journal articles to make Infuse seem safer and less painful than other techniques to fuse vertebrae through spine surgery.
More recent studies have turned up risks and adverse events that weren’t reported in those early studies, even as the spinal-surgery community rapidly adopted Infuse.
More than 6,000 patient-injury claims have been filed in court or are awaiting filing, securities filings say. Medtronic has paid an average $23,000 per case to settle 950 cases, and set aside another $140 million for future legal costs. According to patients’ lawsuits, sales of Infuse exceeded $4 billion from 2002 to 2011.
The FDA approved a narrow use for Infuse in 2002, but journal articles have since attempted to show the benefits and risks of using it in non-FDA-approved ways to expand its market share. Humana’s lawsuit lists the oft-repeated estimate that at least 85 percent of the use of the key Infuse component, a bone-growth protein called BMP, is outside of what the FDA approved.
Examining the dataThe proliferation of studies touting these off-label uses, and the tide of studies showing higher injury rates than first reported, prompted the North American Spine Society to publish an unusual retrospective of the data last December.
The resulting 33-page policy document says many patients getting a spinal-fusion procedure don’t need BMP. Patients who don’t need it include healthy people who are only getting two lower vertebrae fused, most pediatric patients, and patients getting routine fusions of neck bones.
Because of its high cost, Infuse is meticulously monitored by insurers like Humana.
A 2011 study in the journal Surgical Neurology International said hospitals typically pay $5,000 to $6,000 for a large package of BMP. Teuber said hospitals frequently bill insurers for double or triple what they paid for medical devices.
Humana charges that Medtronic “expanded BMP sales by paying large amounts of money to ‘Key Opinion Leader’ (KOL) spine surgeons around the country, many of whom then published articles, or appeared at special ‘dinners’ or continuing education seminars advocating BMP use,” in ways that were not approved by regulators.
The company has long denied such allegations. Resman noted that payments to physicians are based on a small percentage of sales, and that the amounts are closely monitored. “We have a lot of oversight in our process to ensure our process of determining royalties is appropriate and based on fair market value,” she wrote.
California spine surgeon Dr. Charles D. Rosen, co-founder of the Association for Medical Ethics, said the public debate over such payments is important, and federal payment disclosures like those last month act as a fail-safe in making the right decisions for patients. “When you read a paper by a bunch of doctors and it says, ‘This device is good,’ then you might start to use it if you know the research is independent,” Rosen said. “If you find out that all the doctors have royalties and million-dollar consultancies, it doesn’t mean you’re going to rule out the device. But you will think twice about it because it may be a biased review.”￼￼