Senator has questions on Amgen anemia drug rebates

WASHINGTON (Reuters) - Sen. Charles Grassley asked Amgen Inc to explain why some doctors received higher rebates on purchases of the company's anti-anemia drug Aranesp, a letter released on Thursday said.

In a letter to the drugmaker, the Iowa Republican said data he obtained from Amgen indicated oncologists in some states had been given notably higher rebates than others for Aranesp, which is under scrutiny for safety concerns.

"The information raises questions," Grassley said in a statement.

Grassley said there were concerns doctors were profiting by getting reimbursements from the government and private insurers that were higher than their actual cost for Aranesp. Some critics have asked if rebate practices encourage overuse.

Aranesp is Amgen's top-selling drug with 2007 sales of $3.6 billion. The drug is used to treat anemia in patients with cancer and kidney disease, and is part of a family known as erythropoiesis-stimulating agents, or ESAs.

U.S. lawmakers have been investigating the marketing of ESAs by Amgen and Johnson & Johnson amid studies that found some patients given high doses died sooner or saw their cancers grow. A Food and Drug Administration advisory panel urged limits on use in cancer patients last month, and the FDA is considering that advice.

Amgen spokeswoman Kelley Davenport said the company would continue to cooperate with Grassley's inquiry.

She said Amgen, like other companies, provided rebates and discounts to customers and did not believe the practices led to inappropriate or excessive use.

Still, "to avoid even the appearance of such concerns, earlier this year Amgen restructured the rebates of its Aranesp contracts to be based on share of sales rather than sales volume," Davenport said.

Grassley said Amgen data showed the company paid $800 million in rebates in 2006 to more than 6,000 facilities. About 80 percent went to physicians, group practices and physician clinics.

Rebates increased in most states from 2004 to 2006, in some cases doubling, he said.

At one cancer center in Alabama, rebates increased from $1.3 million in 2004 to more than $3 million in 2006. The Web site for the center, which Grassley did not name, shows about 10 oncologists on staff. That translates into about $300,000 in rebates per oncologist in 2006, Grassley said.

"These trends underscore the need for greater transparency in the financial relationships between drug makers and doctors. Patients deserve to know what's going on as they make decisions about their health and safety based on the advice of their doctors," Grassley said.

Grassley, the top Republican on the Senate Finance Committee, asked Amgen to provide details about how it determines rebates or discounts for different doctors and if the purchase of other drugs or the total amount were factors.

Amgen shares fell 2 percent to close at $41.57 on Nasdaq.

(Reporting by Lisa Richwine, editing by Richard Chang/Andre Grenon)