U.S.

Eli Lilly: Not Our Fault

By CBSNews.com staff CBSNews.com staff

August 31, 2001 / 12:40 PM EDT / CBS

An Eli Lilly and Co. executive defended the company's actions in a cancer drug diluting case in Kansas City, saying it is difficult for the company to know who is using its drugs, let alone misusing them.

Thursday's comments to The Indianapolis Star by Garry A. Nicholson, executive director of Lilly's U.S. oncology business, were the first public explanation by a high-ranking Lilly executive about the company's actions in the case involving Kansas City pharmacist Robert R. Courtney.

"Anybody who claims Lilly was aware of dilution in the year 2000 is flat wrong," Nicholson said. "We had no indication there was anything untoward happening."

Courtney is charged in U.S. District Court at Kansas City with diluting expensive cancer drugs, including Lilly's Gemzar, so he could pocket the difference in prices. On Monday he pleaded innocent to 20 felony counts of altering the drugs Gezmar and Taxol,

A growing number of civil lawsuits have been filed on behalf of affected Gemzar families, several of which name the Indianapolis company. They allege Lilly knew since last year that Courtney was selling diluted Gemzar to at least one doctor but sat on the information.

A Missouri court will consider whether the civil cases should be consolidated under one judge or class-action status considered.

Gemzar is one of the toughest drugs for Lilly to track, Nicholson said, because it is sold only to wholesalers and because doctors use it on patients in their offices without writing prescriptions.

Lilly typically uses prescriptions to track its drugs, but instead must track Gemzar through data it buys from tracking companies and information obtained by its salespeople from doctors, Nicholson said.

"The data are often inaccurate. There are no precise, accurate data that can help us," Nicholson said.

According to court documents, Lilly salesman Darryl Ashley told the FBI that he noticed discrepancies in early 2000 between the amount of Gemzar Courtney's pharmacy was buying and the amount the pharmacist was selling.

In May 2001, Ashley talked with Kansas City oncologist Dr. Verda Hunter and that led Hunter to alert federal officials, court records and company officials say.

Nicholson said the salesman's awareness of sales discrepancies for Gemzar were typical and there was no reason for Lilly to suspect any wrongdoing.

Illegal dilution isn't something that Lilly salespeople even consider when they try to reconcile the sales data they collect, Nicholson said.

Michael S. Ketchmark, an attorney for the Kansas City law firm handling lawsuits against Lilly, said Nicholson's explanation appears to contradict Ashley's statement to the FBI.

"We keep getting different explanations...about what happened," Ketchmark said. "The reason is obvious. They realize they've got a huge problem here. They are facing a trial with a potentially huge damage award."

He has also complained in the past about how quickly Lilly moved.

"The Eli Lilly rpresentative started suspecting in early 2000 that the drugs were being diluted," Ketchmark said earlier this month. "He went to Eli Lilly with that information. It wasn't until the summer of 2001, some 18 month later, that they finally told the doctor."

Ketchmark said Gemzar's vulnerability to tampering may become part of his firm's legal case against Lilly. He said Lilly has an obligation to make the product tamperproof.