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ImClone CEO: We ‘Let Patients Down’

June 13, 2002

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WASHINGTON (AP) _ The chief executive of ImClone Systems told Congress Thursday that ``we let patients down″ by submitting a flawed application to the government for approval of a cancer drug the company had touted.

``We now know that we could and should have done a better job in putting together our application package,″ Harlan Waksal said in testimony prepared for a hearing by a House investigative subcommittee. ``We let patients down, and for that, I am truly sorry.″

Congress called on Waksal and his brother, former ImClone chief executive Samuel Waksal _ out on bail from his Wednesday arrest on securities fraud charges _ to unravel a case that cost investors millions, disappointed dying cancer patients _ and may involve insider trading, lying to lawmakers and other sordid goings-on.

ImClone promoted Erbitux as a miraculous treatment for colorectal cancer right up until the Food and Drug Administration rejected its application, saying the drug’s benefit wasn’t proved.

ImClone’s stock has plummeted 90 percent since the December rejection, and the financial travails have overshadowed desperate patients still clamoring for a drug they were led to believe could work without the side effects of traditional chemotherapy.

``Unfortunately, when the company should have been paying more attention to the quality of its clinical trials, its leadership appeared more intent on immediately cashing in″ on the promise of Erbitux, said Rep. Billy Tauzin, R-La., chairman of the House Energy and Commerce Committee.

The government alleges that Samuel Waksal tipped off family members to sell about $10 million in company stock days before the FDA rejection and tried to dump his own shares. In addition, congressional investigators are examining Harlan Waksal’s sale of stock worth $50 million in early December, a day after learning the FDA had serious concerns about Erbitux.

``It appears that, instead of concentrating its focus on the need to carefully conduct clinical trials, that the introduction of a breakthrough medicine demands, ImClone seemed more focused on the sales pitch,″ said Rep. Jim Greenwood, R-Pa., head of the panel’s investigative subcommittee.

Harlan Waksal, who was scheduled to appear later Thursday, took an aggressive tone in his prepared testimony, insisting Erbitux studies showed that about 20 percent of patients responded to the drug.

But a cancer expert hired by congressional investigators concurred with the FDA that ImClone’s studies didn’t prove the drug helps patients. The main Erbitux study was too flawed to tell if anybody benefited from Erbitux, said Dr. Raymond Weiss of Georgetown University Medical Center.

One flaw: A stunning quarter of patients shouldn’t even have been enrolled because it was unclear if they were sick enough and they were taking additional cancer drugs, he said. A second study that enrolled just 57 patients ``does show the drug has an effect for a rare patient″ but probably little benefit, he added.

Samuel Waksal was subpoenaed to appear before the subcommittee, and was granted special permission to travel while on bond to appear later Thursday. His lawyer, Mark Pomerantz, called prosecutors’ evidence ``entirely circumstantial″ and said the government overreacted in arrested him.

Greenwood said if the allegations are true, Waksal could also face contempt-of-Congress charges for lying to his investigators.

The subcommittee also is investigating whether the FDA’s secretive approval process for new drugs makes it easier to manipulate stocks. Lawmakers said Thursday it appeared that ImClone had mislead the FDA about its design of the crucial Erbitux testing, but criticized why the agency’s scientists didn’t catch problems sooner.

Federal law requires the FDA to keep secret information about its review of experimental drugs, meaning the agency couldn’t counter the public hype about Erbitux before its December rejection.

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