The press-release conviction of a biotech CEO and its impact on scientific research


While appealing his conviction, W. Scott Harkonen is serving six months of confinement at his home in San Francisco. (Kirsten Harkonen)
September 23, 2013

Is it a crime for a medical researcher to hype his results? To put a heavy spin on the findings when there are millions of dollars, and possibly lives, at stake?

Just ask W. Scott Harkonen.

“I get four hours for errands, once a week. With good behavior, that could go up to six hours,” the 61-year-old physician said recently. “I feel part of an interned population.”

Once the well-paid head of a publicly traded biotech company called InterMune, Harkonen began six months of home confinement July 1. Several times a day he gets a robo-call that checks to make sure he’s inside. His status is an embarrassment, and few people come to visit.

Of course, things could be worse. A federal prosecutor wanted him to get 10 years in prison. Instead, he got a half-year of home detention in his three-story Tudor in San Francisco. But unless his appeals are successful, he won’t ever be able to work as a pharmaceutical researcher and maybe not as a physician, either.

Harkonen’s crime, according to the U.S. government, a federal jury and the 9th Circuit Court of Appeals, was willfully overstating in a press release the evidence for benefit of a drug his company made.

The press release described a clinical trial of interferon gamma-1b (sold as Actimmune) in 330 patients with a rapidly fatal lung disease. What’s unusual is that everyone agrees there weren’t any factual errors in the four-page document. The numbers were right; it’s the interpretation of them that was deemed criminal. Harkonen was found guilty of wire fraud in 2009 for disseminating the press release electronically.

The conviction has wended through motions and appeals since then, and last month Harkonen’s lawyers petitioned the Supreme Court to hear it. The case has gotten little attention outside the world of pharmaceutical law. Some people, however, view it as a sleeping monster, a threat to free speech in science.

“If you applied this rule to scientists, a sizable proportion of them might be in jail today,” said Steven N. Goodman, a pediatrician and biostatistician at Stanford University who submitted a statement supporting Harkonen’s appeal. “The courts don’t quite realize the significance of what is in front of them or the furor that might erupt if this kooky precedent is allowed to stand.”

A drug for the desperately ill

The drug that Harkonen’s company made is a “biologic response modifier” and had FDA approval for use in two rare inherited diseases. InterMune sought approval to market it for a more common ailment, idiopathic pulmonary fibrosis (IPF). In that disease, the lungs slowly fill with scar tissue, killing a person within two or three years. There’s no good treatment, and about 50,000 new cases are diagnosed each year in the United States.

A study of 18 patients in 1999 found that shots of interferon gamma-1b improved their lung function and lessened their breathlessness. Because nobody died in that one-year study, it was impossible to tell whether the drug increased life span. In September 2000, InterMune launched a study at 58 hospitals around the world to see whether the drug staved off worsening of the disease or death.

Some lung specialists were already prescribing interferon gamma-1b “off-label” for the disease. That’s legal. The company, however, wanted to get Actimmune FDA-approved for IPF, as that would lead to greater use of the drug, which cost up to $50,000 a year. A month before the study began, Harkonen called IPF “a $2 billion market opportunity for InterMune.”

In all, 330 patients were randomly assigned to get either interferon gamma-1b or placebo injections. Disease progression or death occurred in 46 percent of those on the drug and 52 percent of those on placebo. That was not a significant difference, statistically speaking. When only survival was considered, however, the drug looked better: 10 percent of people getting the drug died, compared with 17 percent of those on placebo. However, that difference wasn’t “statistically significant,” either.

Specifically, the so-called P value — a mathematical measure of the strength of the evidence that there’s a true difference between a treatment and placebo — was 0.08. It needs to be 0.05 or smaller to be considered “statistically significant” under the conventions of medical research.

Technically, the study was a bust, although the results leaned toward a benefit from interferon gamma-1b. Was there a group of patients in which the results tipped? Harkonen asked the statisticians to look.

It turns out that people with mild to moderate cases of the disease (as measured by lung function) had a dramatic difference in survival. Only 5 percent of those taking the drug died, compared with 16 percent of those on placebo. The P value was 0.004 — highly significant.

But there was a problem. This mild-to-moderate subgroup wasn’t one the researchers said they would analyze when they set up the study. Subdividing patients after the fact and looking for statistically significant results is a controversial practice. In its most extreme form, it’s scorned as “data dredging.” The term suggests that if you drag a net through a bunch of numbers enough times, you’ll come up with something significant sooner or later.

Exactly what Harkonen was thinking isn’t known, as he didn’t testify at his trial. Nevertheless, the press release’s two headlines focused all the attention on the mild-to-moderate subgroup.

“InterMune Announces Phase III Data Demonstrating Survival Benefit of Actimmune in IPF,” the document said in bold-face letters. Following it in italics was this sentence: “Reduces Mortality by 70% in Patients with Mild to Moderate Disease.”

Those two sentences were Harkonen’s crime.

‘No falsification of data’

In the trial, much was made of P values and the issue of after-the-fact analyses.

Two of the government’s experts testified that if a study misses all its “primary endpoints” (as this one did), then it’s improper to draw conclusions about a drug’s effect in subgroups identified later. The press release acknowledged missing the primary endpoints, but it didn’t indicate that the featured subgroup was identified after the study’s data were collected.

The prosecutors also emphasized that Harkonen had a financial motive for spinning the study in the most positive way. This wasn’t hard to find. The third paragraph of the press release said: “We believe these results will support use of Actimmune and lead to peak sales in the range of $400-$500 million per year, enabling us to achieve profitability in 2004 as planned.”

There was some talk that if Harkonen had just admitted more uncertainty in the press release — using the verb “suggest” rather than “demonstrate” — he might have avoided prosecution. (The U.S. attorney’s office for Northern California declined to talk about the case. The prosecution’s chief statistical expert, Thomas Fleming of the University of Washington, didn’t answer two e-mail requests for an interview.)

What’s unusual is that everything in the press release was correct. What was lacking, the prosecutor, jury, judge and appeals court concluded, was context.

“The government has always agreed that there was no falsification of data here,” said Allan Gordus, a lawyer in the Justice Department’s office of consumer litigation, during the sentencing phase. “Whether there was falsification of the conclusions that could be drawn from the data — that was what the trial was all about.”

Does context matter?

Harkonen’s defenders also think that context is important.

The press release said the results for the primary endpoint weren’t statistically significant. A Morgan Stanley analyst wrote the next day that the study probably wasn’t enough to get Actimmune an FDA label for IPF, although that wasn’t out of the question. When the study was published in the New England Journal of Medicine in January 2004, the authors wrote that “a clinically significant survival benefit could not be ruled out.”

In short, Harkonen’s defense team argued that nobody was deceived by the press release. InterMune’s executive was just expressing an opinion on the usefulness of his company’s drug — an opinion the government didn’t share.

“The fact that somebody else doesn’t think the evidence is enough — does that foreclose you from holding a different view?” his attorney, Mark E. Haddad, said in an interview.

Steven Goodman, the pediatrician and biostatistician, believes that “context” also includes what IPF patients are thinking.

“Part of the issue goes to the level of proof a patient would need when facing a fatal disease with no treatment,” he said. The fact that the study’s main result barely missed statistical significance “is far from proof that the treatment didn’t work. And if I were a patient, I would want to know that.”

(Goodman, who is editor of the journal Clinical Trials, was on the faculty of Johns Hopkins’s Bloomberg School of Public Health when he was hired by Harkonen to assist in the appeals.)

United States v. Harkonen is one more milestone in the long and winding road toward determining when in America a false statement is a crime.

As a general rule, for speech to lose protection of the First Amendment, it must fall into such categories as obscenity, incitement to imminent lawless action, fraud, perjury and false commercial speech. Only some of those categories involve untrue statements. Over the years, rulings have occasionally hinged on such things as the size of the lettering on a product label and the views of people in focus groups.

“We are starting to see these cases with increasing frequency,” said Christopher P. Guzelian, a First Amendment scholar who teaches at the Thomas Jefferson School of Law in San Diego.

Last year, the Supreme Court declared unconstitutional the Stolen Valor Act, which made it a crime for a person to falsely claim to have won a military medal (United States v. Alvarez). But the decision offered little guidance on how the context of a lie may protect it from becoming a crime.

The Harkonen case, which includes no false statements, is all about context. That’s one reason that courts, one way or another, may want to walk it back.

“The reason we may want to let Harkonen go may have very little to do with whether he’s truthful or a liar,” Guzelian said. “It may instead have to do with our mistrust of government’s ability to decide whether he’s a liar.”

‘Shoes never stop falling’

Harkonen left InterMune 10 years ago. He went to work for a privately held biotech company doing Alzheimer’s disease research, but he resigned after his conviction in September 2009. He hasn’t worked since.

In September 2011, the Department of Health and Human Services excluded him for five years from working for any organization that gets money from Medicare or Medicaid — essentially all medical institutions. If his conviction is not overturned by the Supreme Court, the FDA will bar him from employment by any company seeking the agency’s approval for a product; he is appealing the ban. California is coming after his medical license.

“The shoes never stop falling,” he said.

Things haven’t turned out too well for interferon gamma-1b, either.

InterMune did run another trial. It was big — 826 patients at 81 hospitals — in order to maximize the chance of getting clear-cut results. It enrolled only people with mild to moderate lung damage, the subgroup whose success was touted in the press release.

And it failed. A little more than a year into the study, more people on the drug had died (15 percent) than people on placebo (13 percent). That was the death knell for the drug. Most insurers stopped paying for it.

It’s possible that there’s a subgroup of patients, not yet fully identified, who benefit. For example, data suggest that people whose cells still make a fair amount of interferon gamma are helped by the high-priced drug. But it’s unlikely anyone will be trying to figure that out soon.

Certainly not Scott Harkonen.

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