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Rep. Katie Porter Calls Out Big Pharma CEO for Profiting Off Drug Price Hikes

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  • A now-viral clip of Rep. Katie Porter shows her laying into the former CEO of the drug company Celgene for tripling the price of a cancer drug and detailing how that price hike was connected to the CEO’s salary. 
  • The clip comes from a hearing concluding a damning 18-month investigation that found drug company profits are the largest driver of drug price increases and gouging.
  • The reports show that the companies intentionally drove up the prices of essential drugs to meet quarterly earnings goals, engaged in anti-competitive behavior, and lobbied extensively against reforms.

Viral Video

Rep. Katie Porter (D-Ca.) trended on Twitter Wednesday after grilling the former CEO of the drug company over price hikes for the cancer drug Revlimid.

In a viral video, which now has over 19 million views, a white-board wielding Porter writes the number “$13 million” and asks Celgene CEO Mark Alles if it “rings any bells.”

“This was your compensation in 2017 for being CEO of Celgene, and that’s a lot of money. It’s 200 times the average American’s income and 360 times what the average senior gets on Social Security,” she said.

“Now, of that 13 million, about 2.1 million came from your company hitting yearly earnings targets, and more than half of the bonus formula was based on those targets,” she continued. “Any increase in the price of Revlimid would also increase your bonus by increasing earnings, isn’t that right Mr. Alles?”

Alles responded that that assessment was correct, and Porter went on to tell him that the House Oversight Committee found “that if you hadn’t increased the price of Revlimid you wouldn’t have gotten your bonus.”

“In fact, you personally received half a million dollars personally just by tripling the price of Revlimid,” she added. “So, to recap here, the drug didn’t get any better, the cancer patients didn’t get any better: you just got better at making money, you just refined your skills at price gouging. And to be clear, the taxpayer spent $3.3 billion on Revlimid.” 

House Investigation Findings

The now-viral video comes from a House Oversight Committee hearing that took place Wednesday.

The hearing, which was the first of two, marks the conclusion of a nearly two-year-long investigation by the committee’s Democrats into prescription drug price gouging. The reports from that investigation — two of which were also released ahead of the hearing — are incredibly damning. 

Those first two reports focus on Celgene, which is now owned by the drug company Bristol Myers Squibb, and its pricing of Revlimid, as well as another pharmaceutical company called Teva and its multiple sclerosis drug Copaxone. 

Among other things, both reports reveal how the massive profits these companies made have been the driving force in the huge price increases for these essential drugs. 

According to the reports, Teva has raised the price of Copaxone 27 times since 2007, and because of those price increases, an annual course of the drug now costs nearly $70,000  — seven times the $10,000 it cost in 1997. 

As for Revlimid, since 2005, Celgene has raised the price of the drug 22 times, from $215 per pill to $719, the report said. After Bristol Myers Squibb got the rights to Revlimid last November, it raised the price again, to $763 per pill. 

Those price hikes have been insanely profitable. As the reports outline, Copaxone has brought in more than $34 billion in net profits for Teva just in the U.S. alone. Meanwhile, just between 2009 and 2018, Celgene collected $51 billion in net revenues from Revlimid sales worldwide and $32 billion in the U.S. 

As Porter mentioned in the viral clip, the reports also found that those profits end up costing taxpayers and Medicare tens of billions of dollars, which are then used to pay generous executive bonuses.

Another hearing is set to be held Thursday with testimonies from other CEOs of other drug companies. The reports on those companies will be released ahead of the hearing as well.

Reports Contradict CEO Testimonies

In Wednesdays hearing, Alles, as well as the CEO of Teva, both defended the price hikes as above-board and merited.

“The pricing decisions for our medicines were guided by a set of long-held principles that reflected our commitment to patient access, the value of a medicine to patients in the health care system, the continuous efforts to discover new medicines and new uses for existing medicines and the need for financial flexibility,” Alles told the representatives.

However, Porter specifically asked Alles if the drug’s formula had been substantially improved from 2005 , when the pill cost $215, to now, when it costs three times more. Alles confirmed that the manufacturing for the drug had not changed, but said it had been approved for new uses.

Arguably even more damning is the fact that internal documents and emails included in the report showed that executives at both Celgene and Teva raised prices unrelated to costs in order to meet quarterly profit goals.

In one of the most explicit examples, the Celgene report notes that in 2014, Alles — who was then the executive vice president of the company — ordered the price of Revlimid be jacked up by 4% because the company had not met its first-quarter sales goals. Just days later, Alles gave a presentation to the company’s drug pricing advisory board that noted the increase would result in $24 million in new net sales.

As for Teva, the company’s CEO Kåre Schultz also defended the price jacking of Copaxone during the hearing, though he offered another explanation.

“In order for any pharmaceutical company to research and develop new drugs, or improve old ones, the price of successful medicines must reflect the significant cost of ongoing research and development projects,” he said. “The public only sees and pays for the drugs that are ultimately approved by the government, like Copaxone, but you have to expend a lot of resources and endure many disappointments before bringing to the market safe and effective medicines.”

The committee’s report on Teva also disputes that claim too. In fact, it specifically found that Teva has only spent $689 million on research related to Copaxone since 1987 — just 2% of the nearly $34 billion it has taken in net revenue for the drug.

Other Findings

Beyond the price hikes, the reports also gives the public what has been described as the clearest proof to date that large drug companies are engaged in anticompetitive behavior to force competitors out of the market.

In one of the most egregious examples, Teva put out a new, stronger version of Copaxone as part of what they referred to as a coordinated “generic defense strategy.” According to internal documents, that strategy included working with middlemen to block other generic drugs from getting market access, as well as launching aggressive campaigns to lobby doctors and patients to stick with the more expensive version of the drug.

To that point, the Congressional reports also show how these companies have lobbied extensively against regulations and reforms that would prevent them from ramping up drug prices. However, in providing the public with this information, the Democrats on the committee hope to push for substantial drug pricing reforms. 

In a letter prefacing the reports, Oversight Committee Chair Carolyn Maloney (D-Ny.) emphasized the need for comprehensive legislation such as the drug price bill passed by the House back December known as H.R. 3, which would reform the system by allowing Medicare to negotiate directly with drug companies over prices.

As Maloney notes, that bill essentially died in the Senate because President Donald Trump openly opposed it and Senate Republicans refused to even bring it for a vote. 

See what others are saying: (Stat News) (NBC News) (The Cut)

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Soldier Charged With Assault After Shoving Black Man in Viral Video

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  • Authorities charged Army soldier Jonathan Pentland with third-degree assault and battery on Wednesday after a viral video showed him shoving a Black man while yelling at him to leave a South Carolina neighborhood.
  • Many people, including dozens who protested outside Pentland’s home this week, condemned the confrontation as another instance of someone being attacked for “walking while Black.”
  • Pentland and others claimed the unidentified man was picking a fight with neighbors, which the man denied, but police said nothing that may have happened earlier justified Pentland’s actions.
  • If convicted, Pentland faces a $500 fine and 30 days in jail.

Viral Video

A U.S. soldier was charged with assault on Wednesday after a video that circulated online showed him yelling at and shoving a Black man in a South Carolina neighborhood.

Footage of the April 8 incident was posted to social media Monday. It shows the Army soldier, Jonathan Pentland, confronting the unidentified man and telling him to leave the neighborhood. 

The other man explains that he’s just walking through the area and doing nothing wrong, but Pentland becomes increasingly aggressive. “You better walk away,” he shouts at the man after shoving him.

“You either walk away, or I’m gonna carry your ass out of here,” he continues before adding, “You’re in the wrong neighborhood motherf*ker. Get out!”

The man then tries to tell Pentland that he lives in the neighborhood, and Pentland then asks for his address, which he does not give.

The confrontation continues with Pentland cursing and getting in the man’s face. As he does so, the man says that Pentland smells drunk. 

It’s unclear what exactly led up to the confrontation, but in the video, a woman off-camera says the man “picked a fight with some random young lady that’s one of our neighbors.”

“I don’t even know who she is. Nobody picked a fight when someone ran up on me,” the man replies. Another woman off-screen then encourages the man to leave with her, saying, “What’s your name? Come on. You don’t want no trouble.”

Video Triggers Protests Outside Pentland’s Home

After this video spread online, many social media users condemned it as another instance of someone being attacked for “walking while Black.”

In fact, protesters even began demonstrating outside of Penland’s home. Those protests started off peaceful, but deputies were then called after 8 p.m. because unknown individuals vandalized the house. That forced police to shut down access to the area and remove Pentland’s family to another location.

As far as the viral video, deputies were told that the man approached “several neighbors in a threatening manner” and that someone had asked Pentland to “intervene.”

Police did confirm that there are two reports of alleged assault against the unnamed man Pentland shoved that are being investigated. However, they also added that the man has “an underlying medical condition that may explain the behavior exhibited in the alleged incidents.”

Pentland Charged

Either way, police said whatever happened earlier did not justify Pentland’s actions. He was ultimately arrested Wednesday morning and was charged with third-degree assault and battery. He faces a $500 fine and 30 days in jail if convicted.

“We’re not going to let people be bullies in our community,” Richland County Sheriff Leon Lott said at a news conference Wednesday. “And if you are, you’re going to answer for it, and that’s what we’ve done in this case.”

On top of that, the Justice Department reportedly was investigating. Pentland’s Commanding General even issued a statement condemning his behavior, adding that Pentland “brought disrespect to @fortjackson our Army and the trust with the public we serve.”

See what others are saying: (The Washington Post) (ABC News) (Huffpost)

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Texas Students Created Snapchat Group To ‘Slave Trade’ Black Classmates

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  • Freshmen at a Texas high school set up a Snapchat group to pretend to sell their Black classmates. 
  • A screenshot showed the group name being changed from “Slave Trade” with emojis of a Black man, a gun, and a white police officer to “[racial slur] Farm” and then “[racial slur] Auction.”
  • That image also shows a person saying they would spend $100 on a peer while a second student said they would spend $1 on another, adding “would be better if his hair wasn’t so bad.”
  • The school faced backlash for initially describing it as “an incident of cyberbullying and harassment,” without acknowledging the racism. The district later issued a stronger condemnation and said the students were disciplined but did not list specific consequences.

Racist Snapchat Group

Aledo high school students at Daniel Ninth Grade Campus in Northern Texas are making headlines for setting up a Snapchat group to pretend to sell their Black classmates. 

A screenshot reviewed by several local news outlets showed the group name being changed from “Slave Trade” with emojis of a Black man, a gun, and a white police officer to “[racial slur] Farm” and then “[racial slur] Auction.”

That image also shows a person saying they would spend $100 on a peer. A second student said they would spend $1 on another, adding “would be better if his hair wasn’t so bad.”

Screenshot of group chat message via KXAS

At least one student who was mentioned as being “sold” in the chats was later sent screenshots of the conversations.

According to a report from the Star-Telegram reported last week, when the issue was brought to Principal Carolyn Ansley, she sent parents an email that didn’t mention the Snapchat group but only cited “an incident of cyberbullying and harassment.”

That caused frustrations because parents felt the issue of racism wasn’t being addressed or acknowledged.

Mark Grubbs, a father of three former students, told KXAS he was sickened by the students’ actions. Grubbs, who is Black, also said he had taken his children out of the district over other racist incidents in the past.

“My son being called out of his name and what not and it got to the point he didn’t mind fighting and that didn’t sit right with me and my wife. My son was never a fighter,” he said.

District Responds

After the incident garnered media attention, the Aledo Independent School District issued a statement.

The district said it learned of the incident more than two weeks ago and started an investigation that involved law enforcement.

“There is no room for racism or hatred in the Aledo ISD, period,” it added. “Using inappropriate, offensive and racially charged language and conduct is completely unacceptable and is prohibited by district policy.”

District officials spoke with the students responsible as well as their parents, saying they “made it clear that statements and conduct that targets a student because of his or her race is not only prohibited but also has a profound impact on the victims.”

The district also said it assigned disciplinary consequences, though it did not explicitly state what those consequences were or state how many students were involved.

See what others are saying: (The Washington Post) (ABC) (Fort Worth Star-Telegram)

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What You Need To Know About the Johnson & Johnson Vaccine Pause

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  • The CDC and the FDA have issued a joint recommendation to pause distribution of Johnson & Johnson’s COVID-19 vaccine amid reports that six women experienced “extremely rare” blood clots after receiving the single-dose shot.
  • The vast majority of the 6.8 million Americans who were given the Johnson & Johnson vaccine have reported minor to no side effects, and no direct link has been established between the vaccine and blood clots at this time. 
  • The two agencies are expected to release updated guidance in the coming days.
  • Several states and cities are now automatically giving the two-dose Pfizer vaccine to people who were scheduled to receive the Johnson & Johnson vaccine this week. 

CDC and FDA Recommend J&J Vaccine Halt

The Centers for Disease Control and Prevention, as well as the Food and Drug Administration, released a statement Tuesday recommending a pause on the use of Johnson & Johnson’s COVID-19 vaccine.

So far, 6.8 million people in the U.S. have been vaccinated with Johnson & Johnson’s single-dose vaccine, most with zero or only mild side effects.

The updated guidance comes after six women, all between the ages of 18 to 48, experienced what both agencies described as “extremely rare” blood clots six to 13 days after being vaccinated. One of those women has died and another is in critical condition.

Neither the CDC nor the FDA has confirmed that the Johnson & Johnson vaccine is the cause of these blood clots; rather, they said this guidance comes “out of an abundance of caution.”

That’s also in line with Johnson & Johnson itself, which said it’s aware of the reports but added that “no clear causal relationship has been established between these rare events.” As a precaution, Johnson & Johnson has also now delayed the rollout of its vaccine in Europe. 

What Happens From Here?

Principal Deputy Director of the CDC Anne Schuchat said further recommendations will come quickly.

FDA Acting Commissioner Janet Woodcock echoed that statement, saying, “We expect it to be a matter of days for this pause.”

Wednesday, a CDC committee will convene to discuss the cases and assess their potential significance.

When asked if the government was overreacting to just six cases out of nearly 7 million vaccinations (a criticism made by some online), Schuchat said the CDC pulled its recommendation specifically because the type of blood clots seen in these 6 women requires special treatment, so “it was of the utmost importance to us to get the word out.”

In the meantime, both agencies are urging Johnson & Johnson vaccine recipients to contact their doctors if they experience any combination of severe headaches, abdominal pain, leg pain, or shortness of breath. 

What If I Had A J&J Appointment?

Both agencies, as well as other health officials, are still urging unvaccinated people to take the Moderna and Pfizer vaccines when available in their area.

The White House’s COVID-19 response coordinator has said that 28 million doses of those vaccines will be made available this week. Notably, that’s more than enough for the country to continue giving 3 million shots a day. 

If you had an appointment scheduled to get the Johnson & Johnson vaccine, you’re likely not completely out of luck.

For example, while D.C. vaccination sites are canceling all Johnson & Johnson appointments between Tuesday and this Saturday, the health department there has said it’ll send out invitations on Wednesday to reschedule.

Similar situations were reported in Virginia and Maryland, though some vaccination sites in Maryland are still honoring existing appointments by automatically giving people Pfizer instead. That’s also a process that is now being conducted in places like New York State and Memphis.

See what others are saying: (Associated Press) (NBC News) (The Washington Post)

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