By Melody Petersen

Centocor a subsidiary of Johnson & Johnson has been providing doctors with marketing materials that describe how they can make extra money by prescribing a new drug, a practice that health care fraud experts say may be illegal.

Some doctors have recently raised concerns about Centocor's marketing of the new drug, Remicade, an expensive treatment for rheumatoid arthritis.

A document available to doctors on Centocor's Web site until last week, when a reporter asked about it, stated that one "benefit" of prescribing Remicade was the "financial impact" on the physician's practice. The document included a worksheet where physicians could calculate their "estimated revenue per patient" from prescribing the drug.

The "revenue," according to the worksheet, was primarily the difference between what Medicare pays doctors for Remicade, which is given intravenously in their offices, and the lower amount that Centocor charged doctors for the drug. The drug is one of the few rheumatoid arthritis treatments that Medicare covers.

Legal experts say the document described a marketing practice similar to ones found to be illegal when used by other companies and that remain a focus of federal health care fraud investigators.

In one of those cases, federal prosecutors said that Tap Pharmaceutical Products had illegally promoted Lupron, a drug often prescribed for prostate cancer, by telling doctors they could make money through Medicare and Medicaid reimbursements for the drug. Tap agreed to pay $875 million last year to settle criminal and civil charges in that case, the largest sum ever paid for health care fraud.

Dr. Paul April, a rheumatologist in Tulsa, Okla., said that other doctors have told him that Centocor representatives had invited them to meetings where they could learn about how they could profit from Remicade. He said that the rheumatology field is now abuzz with discussion of the money to be made.

Dr. April said he believed that some doctors were prescribing Remicade, which can cost more than $20,000 a year, before they tried a low-cost generic drug called methotrexate, a standard treatment for rheumatoid arthritis. He said some doctors were also choosing Remicade over Enbrel, a similar new medicine that is also expensive, because of the extra money they could make.

Doctors are also motivated to prescribe Remicade, Dr. April said, to help their elderly patients afford an effective medicine since it is covered by Medicare and similar drugs are not.

American College of Rheumatology guidelines suggest that doctors prescribe Remicade or Enbrel only after patients have not responded to methotrexate, or have shown they cannot tolerate it.

Both Remicade and Enbrel, are made by Immunex in a marketing partnership with Wyeth. But both drugs have side effects, including an increased risk of serious, life-threatening infections.

Remicade is being overused because there is money to be made by using it.

Medicare pays only for drugs that must be administered by a physician. Of drugs for rheumatoid arthritis, Remicade is one of very few covered by Medicare because it must be given intravenously. Enbrel, also a biologically engineered medicine, can be injected by patients themselves and is not covered. Most of the other drugs for rheumatoid arthritis are taken orally.

Remicade and Enbrel, which were approved in 1998, are in a heated marketing battle. Sales of both drugs have risen rapidly since they were approved in 1998, but Enbrel has been outselling Remicade. Now Remicade is gaining ground.

Sales of Remicade were $658 million last year, more than double the $256 million in sales in 2000, according to NDCHealth, a health care information company. Sales of Enbrel were $907 million last year, up almost 18 percent from $770 million in 2000.

Medicare is supposed to receive a discount on the prices that pharmaceutical companies charge other customers. Medicare, therefore, reimburses doctors for drugs at 95 percent of what is called the average wholesale price. But investigators have found that some companies have inflated the average prices reported to the government so that Medicare reimbursements are higher than what the companies most often charge.

According to the federal government, Medicare's payments for Remicade skyrocketed last year. Medicare paid at least $141 million for Remicade last year - almost three times the $48 million the government paid for the drug in 2000.

New York Times April 11, 2002