December 1, 2023

F.D.A. Proposes Rules to Enforce U.S. Standards for Imported Food

WASHINGTON — The Food and Drug Administration proposed sweeping new rules on Friday that would require food importers like Walmart and Cargill to make sure that their foreign growers and processors were following American food safety standards to prevent contamination in an increasingly globalized food supply.

About 15 percent of food that Americans eat comes from abroad, including nearly two-thirds of fresh fruits and vegetables.

The rules, if made final, would shift the responsibility for ensuring that food is safe from the F.D.A. to companies. American companies would have to prove that their foreign suppliers had controls in place through actions like auditing the foreign facilities, testing food, and reviewing records. American importers would have to keep their own records on foreign suppliers. They would be allowed to hire outside auditors to make on-site inspections.

These are the last major rules needed to implement the Food Safety and Modernization Act, a landmark law passed by Congress in 2010 that was the first significant update of the agency’s food safety authority in 70 years. The administration has been criticized for not moving more quickly to carry out the law. The first set of rules, which applied to domestic producers, was proposed in January. The new rules proposed Friday exempt importers of seafood and fruit juices.

The cost to industry of the new rules on imports would be $400 million to $500 million, said Michael R. Taylor, deputy commissioner for foods and veterinary medicine at the F.D.A.

“If you look at the cost of doing it all by the feds, what you end up with is inadequate dollars,” said Dr. David Acheson, a former F.D.A. official who is currently with Leavitt Partners, a food safety and health care consulting firm in Washington. The current system, he said, “doesn’t work anymore. So let’s leverage the private sector.”

The new rules would represent a major shift in the way the United States handles food safety by subjecting imported foods to the same safety standards as food produced domestically. Under the current system, the F.D.A. has very limited authority to ensure the safety of food produced abroad. It inspects less than two percent of all imported food.

“We don’t live in local land anymore,” said Dr. Acheson. “Though many people want to buy local, the reality is most Americans are buying things in big stores and relying on imported products.”

Consumer advocates said it remained to be seen whether the new rules would have a real effect, and that the test would be whether importers would be required to make sure their foreign sellers were adhering to new standards, or whether it would be voluntary. The Obama administration has also been criticized for taking two years to complete the rules, with some complaining that the White House was more concerned about protecting itself from Republican criticism than about public safety.

The draft rules will be open to comment from the public for 120 days, the agency said. The comment period will end in the late fall for Friday’s rules as well as the ones proposed in January.

The Food and Drug Administration is responsible for the safety of about 80 percent of the food that Americans consume. The rest falls to the Agriculture Department, which is responsible for meat, poultry and some eggs.

Mr. Taylor said the goal of the changes is to build a system that prevents food contamination rather than reacting to it.

“Less than 2 percent of import shipments are physically examined, and we’re up to around 10 million food products annually,” he said. “We all realize we need to do more.”

The agency, which has about 1,600 investigators handling imports of everything from food to drugs and medical devices, has also asked for more funds. President Obama’s 2014 budget reflects that, Mr. Taylor said, requesting about $260 million in additional resources, much of which would go to build the system to regulate imports.

Erik Olson, a researcher at the Pew Charitable Trusts, which advocated for passage of the law, said the new rules would work only if they required an audit and that it was not clear that they did.

“That could end up as a paper exercise,” he said. “We view on-site verification as absolutely critical to a successful program.”

Mr. Olson said that 8 of the 19 multistate food outbreaks linked to F.D.A. regulated products that have occurred since January 2011 when the bill was signed into law have been linked to imports. Most recently, pomegranate seeds from Turkey sickened more than 140 people across the country with hepatitis A.

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Law Spoils Tobacco’s Taste, Australians Say

And though experts say it is too soon to know what impact the law has had on tobacco use, one thing is certain: Smokers think the cigarettes taste off. Complaints started to roll in about the flavor of cigarettes almost immediately after the law went into effect on Dec. 1. That could mean a lot for health advocates’ efforts to prevent smoking.

“Of course there was no reformulation of the product,” the Australian health minister, Tanya Plibersek, said in an interview. “It was just that people being confronted with the ugly packaging made the psychological leap to disgusting taste.”

She said it would be a number of years before she could say that the effort decreased smoking rates and improved residents’ health. “But the best short-term indication I have that it’s working is the flood of calls we had in the days after the introduction of plain packaging accusing the government of changing the taste of cigarettes,” Ms. Plibersek said.

All parties in the battle over smoking in Australia have their own take on the law’s effects. The most reliable sales figures are proprietary and guarded by the tobacco companies, while the government’s latest figures will not be released until September.

Australia has been out in front in requiring graphic imagery on tobacco labels. European Union ministers agreed last month on new rules that would require a health warning that would combine pictures and text and cover 65 percent of the front and back of all cigarette packs, up from 40 percent. The rules require approval by the European Parliament.

In the United States, a 2009 law empowered the Food and Drug Administration to require large graphic and text warnings on the top half of the front and back of cigarette packs. But as federal courts have wrestled with the details of that law in challenges by the tobacco industry, the F.D.A. has not yet imposed a final set of labeling requirements.

Tobacco is taxed heavily in Australia, where smokers spend about 16 Australian dollars, or $14.70, for a pack of cigarettes. Partly as a result, smoking rates in Australia have declined. Last year, according to the latest figures from the Australian Bureau of Statistics, 20.4 percent of adult men were smokers and 16.3 percent of adult women smoked. In the United States, the most recent data from the Centers for Disease Control and Prevention showed that the smoking rate was 21.5 percent among adult men and 17.3 percent for adult women.

Smoking is also banned in nearly all enclosed public spaces in Australia, including restaurants, bars, sporting facilities and places of business.

The new labeling law, which bans brand logos and requires health warnings to cover 75 percent of the front of cigarette packages and 90 percent of the back, aims to remove the allure of well-known brands. Last year, a challenge to the law brought by British American Tobacco, Imperial Tobacco, Japan Tobacco and Philip Morris Australia — arguing that it was a violation of their intellectual property rights — was dismissed by the Australian High Court.

The packaging law is quickly becoming an international trade issue. Philip Morris Asia, whose headquarters are in Hong Kong, is challenging the legislation under a broad 1993 bilateral trade agreement aimed at promoting and protecting trade between Australia and Hong Kong. Philip Morris argues that by stripping its products of their brand identity, the law hurts its intellectual property in violation of that agreement.

Cuba, the world’s dominant producer of fine cigars, filed a “request for consultations” in May with Australia through the World Trade Organization, the first time the country has used the forum to confront another nation directly over its commercial laws. The Dominican Republic, Honduras and Ukraine have already challenged Australia over the issue at the W.T.O., citing “technical barriers” to trade and violations of intellectual property rights.

In another closely followed move, Japan Tobacco, Asia’s biggest publicly listed cigarette maker, said at the end of June that it had filed suit against the Thai government over its plan, announced in April, to increase the size of graphic health warnings to 85 percent of the cigarette pack cover, from 55 percent.

This article has been revised to reflect the following correction:

Correction: July 10, 2013

An earlier version of this article misstated the amount of time since Australia imposed one of the world’s toughest laws for tobacco warning labels. It is more than seven months, not almost six months.

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Doctor’s Doubts Imperil Lucrative Diabetes Drugs

“I said, I’m not interested in your money, go away,” Dr. Butler recalled.

Merck no doubt now wishes it had. When Dr. Butler finally agreed to do the study, he found worrisome changes in the pancreases of the rats that could lead to pancreatic cancer. The discovery, in early 2008, turned Dr. Butler into a crusader whose follow-up studies now threaten the future of not only Januvia but all the drugs in its class, which have sales of more than $9 billion annually and are used by hundreds of thousands of people with Type 2 diabetes.

“I knew some stuff that I thought was a worry and I was obliged to pursue it,” said Dr. Butler, chief of the division of endocrinology at the University of California, Los Angeles.

Based on his latest study, both the Food and Drug Administration and the European Medicines Agency have begun investigations that could lead to new warnings on the drugs, or even to their removal from the market.

Or they could result in no action at all.

Dr. Butler faces powerful opponents in the makers of the drugs and many diabetes specialists, who say his studies are contradicted by other evidence.

“The data are inconclusive,” said Dr. Robert Ratner, chief scientific and medical officer of the American Diabetes Association. He said even if there were some excess risk, it would be “exceptionally low.”

Nancy Thornberry, who heads diabetes drug development at Merck, said that clinical trials, the gold standard of medical evidence, had found no increased risk of pancreatic disease from Januvia, even when results of trials were pooled to achieve greater numbers. “In fact, my mother takes sitagliptin,” she added, referring to Januvia by its generic name.

Questions about whether the drugs raise the risk of pancreatitis, a painful and possibly lethal inflammation of the pancreas, arose soon after the first one, Byetta, now sold by Bristol-Myers Squibb and AstraZeneca, was approved in 2005. The drugs’ labels already contain warnings about that. What is new and potentially more serious is a possible risk of pancreatic cancer, which is virtually untreatable and kills most victims within a year.

Many people in the field compare Dr. Butler to Dr. Steven Nissen, the well-known Cleveland Clinic cardiologist whose warnings about Avandia, a different type of diabetes drug, led to its being banned in Europe and highly restricted in the United States.

Both men have faced criticism from those who call them zealots. The F.D.A. is about to examine data suggesting that Avandia might not be so dangerous after all. Some critics say Dr. Butler overstates his conclusions and that his findings have not been replicated by others.

“Basically, no one in the entire world over the last 10 years, with thousands of animals,” has found what Dr. Butler found, said Dr. Daniel J. Drucker, a professor of medicine at the University of Toronto and a consultant to many drug companies.

Still, Dr. Butler is not easy to write off. He is a former editor of Diabetes, the flagship journal of the American Diabetes Association. And he has some defenders.

“He should be an American hero, actually, a rugged individualist who is not going to be browbeaten,” said Dr. Edwin Gale, professor emeritus at the University of Bristol in Britain, who recently wrote a commentary with Dr. Butler on the drugs.

Dr. Butler was born in Kenya to British parents, though he has worked in the United States since 1987 and is an American citizen. His wife, Dr. Alexandra E. Butler, a pathologist who occupies the office next to his, has also worked on some of the studies.

In the last month, lawyers defending drug companies against a lawsuit claiming that Byetta had caused a patient’s pancreatitis, subpoenaed virtually all of Dr. Butler’s records.

“I think the message here is they want him out of business,” said Brian Depew, a lawyer representing the plaintiff, Ross Hubert of New Hampshire, who claims that Byetta caused him to get pancreatitis. Dr. Butler said U.C.L.A. told him not to comment on the subpoena.

More than 100 lawsuits representing 575 plaintiffs around the country are claiming injury from Byetta, mostly pancreatitis, according to the latest quarterly regulatory filing from Bristol-Myers. Forty-three suits claim that Januvia caused pancreatic cancer, according to Merck.

This article has been revised to reflect the following correction:

Correction: May 31, 2013

An earlier version of this article referred imprecisely to Dr. Butler’s position of at the University of California, Los Angeles. He is the chief of the division of endocrinology at the university — not chairman, which the school uses for the head of the department of medicine.

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New Test Detects Most Colorectal Cancers, Study Finds

Still, the results fell short of investor expectations and even those of the company that developed the test, the Exact Sciences Corporation, sending its shares down about 20 percent in afternoon trading on Thursday.

In its news release about the study Thursday morning, Exact Sciences said its test detected 92 percent of the cancers picked up by colonoscopy, and 42 percent of potentially precancerous polyps. It had a false positive rate of 13 percent.

The test looks for alterations in human DNA found in a stool sample. The company contends that people will not find it off-putting to deposit a sample of their stool in the company’s collection apparatus and mail it to a laboratory.

The new test, called Cologuard, would not replace colonoscopy. Colonoscopy remains the gold standard for colorectal screening, in part because any polyps detected can also be removed during a colonoscopy, possibly preventing cancer.

But about half of people over 50, the recommended age to start screening for colorectal cancer, are either not adequately screened or not screened at all, in part because colonoscopy is invasive, uncomfortable, expensive and time-consuming.

Exact Sciences says the noninvasive test could allow more people to be screened, and those with a positive result could then get a colonoscopy.

“For the first time noninvasively, we can detect reliably precancerous polyps,” Kevin T. Conroy, the company’s chief executive, told analysts on Thursday. Exact Sciences, which is based in Madison, Wis., said it would soon complete its application to the Food and Drug Administration seeking approval of the Cologuard test.

There were about 143,000 new cases of colorectal cancer and 52,000 deaths in the United States last year, making it the second-leading cause of cancer death behind lung cancer, according to the American Cancer Society.

Dr. Deborah A. Fisher, an associate professor of medicine at Duke University, who was not involved in the study, said the Cologuard test appeared to be a viable option, but only one of several.

“I don’t think this is the holy grail,” said Dr. Fisher, a gastroenterologist who is a consultant to Epigenomics, a company developing a test that could compete with Cologuard. She said it was too soon to tell if the Cologuard test would actually increase the number of people being screened and said there was no data showing that its use actually prevented cancer deaths.

Dr. Fisher said existing noninvasive tests that look for blood in the stool can detect around 80 percent of cancers and 20 to 40 percent of polyps. These tests cost about $25, she said, while the Cologuard test is expected to cost a few hundred dollars.

Exact Sciences said participants in its study also received a stool blood test, known as a fecal immunochemical test. The Cologuard test, the company said, proved to be better than that test in detecting polyps and roughly equivalent in detecting cancer.

The company did not release the data, however, saying it would eventually be published in a peer-reviewed medical journal. The study involved about 10,000 people with an average risk of colorectal cancer. They were screened at 90 sites in the United States and Canada.

Mr. Conroy of Exact Sciences said the 42 percent success rate in detecting polyps, while below the company’s goal of 50 percent, was still a powerful result. He said the test caught 66 percent of polyps larger than two centimeters, which were more likely to become cancerous than smaller ones.

He also said that since colon cancer developed over many years, if people took the Cologuard test every three years, most polyps would be detected before they could cause problems. Such repeated testing is the reason the Pap test has greatly reduced deaths from cervical cancer, even though Pap tests miss precancerous lesions as much as half of the time.

But Dr. Fisher of Duke said yearly use of the less expensive fecal immunochemical test would also eventually detect many polyps.

The false positive rate of 13 percent for the Cologuard test was also higher than Exact Science’s goal of 10 percent. A false positive usually would mean that a person would get a colonoscopy that might not be needed.

The Cologuard test looks for mutations and chemical changes in DNA indicative of cancer. It takes advantage of the fact that cells lining the colon are continually sloughed off and broken apart, releasing their DNA.

But detecting that DNA in the stool is extremely difficult. Virtually all the DNA in the stool comes from bacteria, said Dr. David A. Ahlquist, a professor at the Mayo Clinic who helped develop the Cologuard test. Only 0.01 percent is the person’s own DNA, and of that, only a tiny fraction would be from cancerous cells, he said.

There have been some earlier versions of Exact Science’s test that did not work well.

Epigenomics, based in Germany, recently applied for F.D.A. approval of a screening test that looks for a chemical change to one gene.

Epigenomics has said its test, called Epi proColon, detected 71 percent of cancers in its large clinical trial, with a false positive rate of 19 percent. The test is not aimed at detecting polyps.

That would make it less accurate than the Cologuard test. It is a blood test, however, not a stool test.

“People are very comfortable with blood-based tests,” said Karen A. Heichman, vice president for oncology technology development and licensing at ARUP Laboratories in Salt Lake City, which offers its own version of the test under license from Epigenomics.

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Safety of Monster Energy Drinks Questioned

In a letter sent late Wednesday to Monster Beverage, the city attorney of San Francisco, Dennis J. Herrera, told the company to substantiate its claim that large daily quantities of Monster Energy were safe for adolescents and adults.

Mr. Herrera also told Monster, a publicly traded company, to produce support for its promotional slogans, like one that claims that consumers of Monster Energy “can never get too much of a good thing!”

In taking the action, Mr. Herrera cited a section of a California state law that makes it illegal for a company to make false or misleading advertising claims that purport to be based on fact or clinical data.

In a statement, Monster Beverage said: “The company can document the legal basis by which its products are properly labeled dietary supplements, and third party scientific documentation substantiates their safety.”

The energy drink industry and Monster Beverage in particular has come under intensifying scrutiny since last week after disclosures that the Food and Drug Administration had received reports that the deaths of five people since 2009 may be linked to Monster Energy drinks.

The company has repeatedly disputed any suggestion that its drinks pose a risk. The F.D.A., which said it was looking into the episodes, added that the receipt of a death or injury filing associated with a product did not mean that it was responsible.

Last week, two Democratic lawmakers, Senator Richard J. Durbin of Illinois and Senator Richard Blumenthal of Connecticut, sent the latest of several letters to the F.D.A. commissioner, Margaret Hamburg, urging the agency to take action on energy drinks.

The agency has taken the stance that there is insufficient data to take additional action on energy drinks. Both Democratic lawmakers have been critical of that position.

The New York State attorney general is investigating the practices of several producers.

In his letter Wednesday, Mr. Herrera asserted that Monster Beverage, through its advertising and marketing claims, had encouraged “unsafe and irresponsible consumption of its products.”

Monster Energy drinks do not disclose caffeine levels. But product labels advise against drinking more than three of the 16-ounce cans or two of the 24-ounce cans daily, amounts that each contain a total of 480 milligrams of caffeine.

The F.D.A. has suggested that 400 milligrams of caffeine a day from all sources is safe for adults, although many medical experts believe that adults can safely consume more. There is far less data about safe caffeine levels for teenagers.

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Two Drugs Appear to Delay Progression of Breast Cancer

Both drugs, pertuzumab from Genentech and everolimus from Novartis, also showed signs in clinical trials that they could prolong lives, though researchers said it was too early to say that definitively.

Results of the studies, which were sponsored by the companies, are being presented this week at the San Antonio Breast Cancer Symposium and were published online Wednesday in The New England Journal of Medicine.

Pertuzumab is designed to complement Genentech’s big-selling drug Herceptin for the roughly 20 percent of breast cancer patients whose tumors have elevated levels of a protein called Her2. Both pertuzumab and Herceptin block the action of the protein but in different ways.

In a late-stage clinical trial involving 808 patients, women randomly chosen to receive pertuzumab, Herceptin and the chemotherapy drug docetaxel went a median of 18.5 months before their tumors worsened or they died, a measure known as progression-free survival. That was significantly longer than the 12.4 months for those who received a placebo, Herceptin and docetaxel.

“We have an improvement in progression-free survival that is six months,” Dr. José Baselga, chief of hematology and oncology at Massachusetts General Hospital, said in an interview. “That’s huge. By any criteria we want to analyze, this is clinically meaningful.”

Dr. Baselga was a principal investigator in the studies of both pertuzumab and everolimus and has been a paid consultant for Genentech and Novartis.

He said the addition of pertuzumab did not increase cardiac dysfunction, a worrisome side effect of Herceptin.

Genentech and its parent company, Roche, have applied in the last few days for permission to market pertuzumab in the United States and Europe.

Approval could help the company recover from the recent decision of the Food and Drug Administration to revoke the approval of another Genentech drug, Avastin, for the treatment of breast cancer.

Avastin had been approved based on a trial that showed it delayed the worsening of tumors by 5.5 months — almost as big a gain as seen now with pertuzumab. But the use of Avastin did not prolong lives, and subsequent studies found a much smaller improvement in progression-free survival.

That could make the F.D.A reluctant to approve pertuzumab unless it also helps women live longer. But Dr. Sandra J. Horning, head of cancer clinical trials at Genentech, said the pertuzumab results on tumor progression were more trustworthy than the original Avastin results because the trial was conducted more carefully.

Novartis’s drug, everolimus, is a tablet that is already sold under the name Afinitor to treat kidney cancer and some rare tumors. Novartis plans to apply for the tablet’s approval as a breast cancer treatment by the end of the year.

Its clinical trial involved 724 postmenopausal women with hormone receptor-positive metastatic breast cancer.

The women who took both everolimus and a drug called exemestane had a median progression-free survival of 7.4 months compared with 3.2 months for those who took a placebo plus exemestane. Exemestane, also known by the brand name Aromasin, deprives tumors of estrogen, which can fuel their growth.

Women in the study already had failed to benefit from other estrogen-depriving drugs. So perhaps it is not surprising that the control arm did not do that well on exemestane alone.

“They put it up against a weak opponent,” said Dr. Peter Ravdin, a breast cancer specialist at the University of Texas Health Science Center at San Antonio, who was not involved in the study.

But trial investigators said the comparison was valid because in daily practice, doctors often use exemestane when other estrogen-blocking drugs fail.

Everolimus works by inhibiting mTOR, a protein that often spurs tumor growth after tumors become resistant to hormone therapy.

“This is the first time we have a strategy to revert endocrine resistance, which has been the holy grail of therapy for endocrine-positive tumors,” Dr. Baselga said.

Another drug — entinostat, from privately held Syndax Pharmaceuticals — might also be able to do that, according to the results of a small study presented in San Antonio. Women who received that drug plus exemestane had delayed tumor progression and also lived months longer than those who took exemestane alone.

Those results will have to be confirmed in a larger trial, and it will be several years before entinostat can reach the market.

Everolimus costs about $7,000 a month when used for kidney cancer. The drug can have significant, even fatal, side effects like mouth sores, infections and lung inflammation. That could give some doctors pause about adding it to hormone therapy.

“Hormone therapy, which is relatively well tolerated, becomes closer to chemotherapy” in terms of side effects, said Dr. Clifford A. Hudis, chief of the breast cancer medicine service at the Memorial Sloan-Kettering Cancer Center, who was not involved in the study.

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DealBook: Gupta Faces Criminal Charges

Rajat K. Gupta, a former director of Goldman Sachs.Seokyong Lee/Bloomberg NewsRajat K. Gupta, a former director of Goldman Sachs.

Federal prosecutors are expected to file criminal charges on Wednesday against Rajat K. Gupta, the most prominent business executive ensnared in an aggressive insider trading investigation, according to people briefed on the case. He is expected to surrender to authorities on Wednesday.

The case against Mr. Gupta, 62, would extend the reach of the government’s inquiry into America’s most prestigious corporate boardrooms. Most of the defendants charged with insider trading over the last two years have plied their trade exclusively on Wall Street.

The charges would also bring to a head a stunning fall from grace of a trusted adviser to political leaders and chief executives of the world’s most iconic companies.

A former director of Goldman Sachs and Procter Gamble and the longtime head of McKinsey Company, the elite consulting firm, Mr. Gupta has been under investigation over whether he leaked corporate secrets to Raj Rajaratnam, the hedge fund manager who was sentenced this month to 11 years in prison for trading on illegal stock tips. While there has been no indication yet that Mr. Gupta profited directly from the information he passed to Mr. Rajaratnam, securities laws prohibit company insiders from divulging corporate secrets to those who then profit from it.

The case against Mr. Gupta, who lives in Westport, Conn, would tie up a major loose end in the long-running investigation of Mr. Rajaratnam’s Galleon Group hedge fund. Yet federal authorities continue their campaign to ferret out insider trading on multiple fronts. This month, for example, a Denver-based hedge fund manager and a chemist at the Food and Drug Administration pleaded guilty to such charges.

A spokeswoman for the United States attorney in Manhattan declined to comment.

Gary P. Naftalis, a lawyer for Mr. Gupta, did not respond to requests for comment. Mr. Naftalis has previously said that his client did nothing wrong.

Mr. Gupta, in his role at the helm of McKinsey, was a trusted adviser to business leaders including Jeffrey R. Immelt of General Electric and Henry R. Kravis of the private equity firm Kohlberg Kravis Roberts Company. An Indian from Kolkata and a graduate of the Harvard Business School, Mr. Gupta has also been a philanthropist, serving as a senior adviser to the Bill and Melinda Gates Foundation. Mr. Gupta also served as a special adviser to the United Nations.

His name emerged just a week before Mr. Rajaratnam’s trial in March, when the Securities and Exchange Commission filed an administrative proceeding against him. The agency accused Mr. Gupta of passing confidential information about Goldman and Procter to Mr. Rajaratnam, who then traded on the news.

The details were explosive. Authorities said Mr. Gupta gave Mr. Rajaratnam advanced word of Warren E. Buffett’s $5 billion investment in Goldman Sachs during the darkest days of the financial crisis in addition to other sensitive information affecting the company’s share price.

At the time, federal prosecutors named Mr. Gupta a co-conspirator of Mr. Rajaratnam, but never charged him. Still, his presence loomed large at Mr. Rajaratnam’s trial. Lloyd C. Blankfein, the chief executive of Goldman, testified about Mr. Gupta’s role on the board and the secrets he was privy to, including earnings details and the bank’s strategic deliberations.

The legal odyssey leading to charges against Mr. Gupta could serve as a case study in law school criminal procedure class. He fought the S.E.C.’s civil action, which would have been heard before an administrative judge. Mr. Gupta argued that the proceeding denied his constitutional right to a jury trial and treated him differently than the other Mr. Rajaratnam-related defendants, all of whom the agency sued in federal court.

Mr. Gupta prevailed, and the S.E.C. dropped its case in August, but maintained the right to bring an action in federal court. The agency is expected to file a new, parallel civil case against Mr. Gupta as well. It is unclear what has changed since the S.E.C. dropped its case in August.

An S.E.C. spokesman declined to comment.

The case could be a challenge for the government. Many of the defendants convicted of insider trading, including Mr. Rajaratnam, have been caught on wiretap swapping secret information.

At Mr. Rajaratnam’s trial, the government played a recorded conversation between Mr. Gupta and the hedge fund manager in July 2008. On that call, Mr. Gupta divulged that Goldman was considering a purchase of either Wachovia or American International Group. Evidence that Mr. Rajaratnam traded on this information was never presented, however.

Two of the most incriminating calls played pertain to alleged tips from Mr. Gupta. But those calls were conversations between Mr. Rajaratnam and his employees, which could make them inadmissible in a trial of Mr. Gupta.

In one call played for the jury, Mr Rajaratnam told a colleague, “I heard yesterday from somebody who’s on the board of Goldman Sachs that they are going to lose $2 per share.” In the other, the hedge fund manager said to his trader, ’”I got a call saying something good is going to happen to Goldman.”

The S.E.C.’s original case also outlined evidence that could potentially be used at trial. That includes Mr. Gupta’s phone records of on Sept. 23, 2008. That day, the Goldman board met via telephone to consider Mr. Buffett’s $5 billion investment in Goldman.

“Immediately after disconnecting from the board call, Gupta called Rajaratnam from the same line,’’ the S.E.C. filing says. A minute later, Galleon funds bought more than 175,000 shares of Goldman just before the market closed, the agency says, and later netted a $900,000 profit when the deal was announced.

Though he had an enviable résumé and earned millions of dollars a year at McKinsey, Mr. Gupta became fixated on the extraordinary wealth showered on hedge fund managers and private equity chiefs. Consultants are well paid, but the compensation pales in comparison to those Wall Street titans.

Around the time of his retirement in 2007, he and Mr. Rajaratnam helped start New Silk Route, a private equity firm focused on investments in India. Though Mr. Rajaratnam never had an active role in the firm, he and Mr. Gupta were good friends, having met through their philanthropic interests.

Mr. Gupta periodically visited Mr, Rajaratnam’s hedge fund, Galleon, on Madison Avenue and 57th Street in Manhattan. The two would order Indian or Chinese takeout and kibitz in Mr. Rajaratnam’s office. Mr. Gupta became an investor in Galleon’s hedge funds.

As part of his foray into Wall Street, Mr. Gupta took a senior adviser post at K.K.R., the firm co-founded by his friend Mr. Kravis. During Mr. Rajaratnam’s trial, prosecutors played a tape of the hedge fund manager gossiping with a friend about Mr. Gupta’s ambitions.

“My analysis of the situation is he’s enamored with Kravis, and I think he wants to be in that circle,” Mr. Rajaratnam said. “That’s a billionaire circle, right?”

William K. Rashbaum contributed reporting.

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Digital Domain: Wireless Medical Monitoring Might Untether Patients

Suppose, however, that all of a convalescent patient’s electrode patches were consolidated into a single, nearly invisible and weightless version — as thin as a temporary, press-on tattoo. And suppose that a tiny radio transmitter eliminated the need for any wires tethering the patient to monitoring machines.

“Epidermal electronics” — a term coined by researchers who have produced prototype devices at the University of Illinois at Urbana-Champaign — may enable constant medical monitoring anywhere.

The devices are part of a growing field, called mHealth, that uses mobile technologies. Simpler forms include smartphone apps for patient education or disease management. More complex ones include wireless sensors to monitor vital signs.

“MHealth is managing conditions continuously, so that they don’t reach a crisis,” says Donald M. Casey, chief executive of the West Wireless Health Institute, a nonprofit research organization in San Diego.

Wireless sensor technology is advancing rapidly. Last year, for example, Corventis, a medical device company based in San Jose, Calif., received Food and Drug Administration approval to market its Nuvant Mobile Cardiac Telemetry System, used to detect arrhythmias. A 2-by-6-inch electronic gizmo on a patient’s chest sends an electrocardiogram to a nearby transmitter, which relays it to a central monitoring center.

“Sensors on everyone, including a 60-year-old watching a football game who doesn’t know he’s at risk for a heart attack, would greatly reduce the chances of a fatal attack,” says Dr. Leslie A. Saxon, a cardiologist at the University of Southern California.

One form of the monitoring will be tested on the football field itself. With a grant from the National Football League, Dr. Saxon will study one unnamed N.F.L. team this fall. Each player will wear a monitoring patch for a week.

Not all mobile monitoring technology can transmit data wirelessly. The patches that Dr. Saxon will use, for example, store their data within; the information will be uploaded when the devices are retrieved at the end of the study. In other cases, the technology has been approved only for hospital settings where a doctor is present. But, looking ahead, the promise of epidermal electronics has excited mHealth advocates.

Mr. Casey singled out the work of the University of Illinois researchers, led by John A. Rogers, an engineering professor and a 2009 MacArthur Fellow. Their work on epidermal electronics was published last month in the journal Science. While the monitor patch made by Corventis weighs 1.8 ounces, the ultrathin one created at Illinois weighs only three-thousandths of an ounce.

“If the technology delivers as promised,” Mr. Casey says, “then we believe that’s when we’ll move from sensors on people diagnosed with a disease to literally everybody.”

Professor Rogers is a co-founder of MC10, an electronics company in Cambridge, Mass., that is aiming to turn the epidermal monitor prototype into a commercial product in 2013. David A. Icke, MC10’s chief executive, said the company’s skinlike device consists of tiny components that are physically separated, like electronic “islands.” They are connected with squiggles he calls “serpentines,” which are designed to bend and absorb strain without breaking. The technology can theoretically be used both inside the body and on the skin.

Electronic monitoring of patients at home could significantly reduce medical costs. A study by the Department of Veterans Affairs and published in 2008 suggests possibilities for savings.

From 2003 to 2007, researchers tracked a large group of patients with serious conditions, including congestive heart failure and chronic obstructive pulmonary disease. Patients who enrolled in a “home telehealth” program were given biometric devices to monitor and record their vital signs. The department said that these patients showed a 25 percent drop in the number of bed days of care and a 19 percent drop in hospital admissions, compared with the time they were not in the program.

In the Veterans Affairs monitoring program, the average cost of $1,600 per patient a year was much lower than the $13,121 spent by the department to provide home-based primary care without the “tele” component. The department also compared the low cost of its telehealth services with the $77,745 per patient a year spent on nursing home care.

DESPITE the promise of big savings, relatively few patients are being monitored with existing technology. Chuck Parker, executive director of Continua Health Alliance, an mHealth industry group, estimates that only 50,000 to 70,000 patients in the United States are monitored today.

One obstacle to wider adoption, Mr. Parker says, is a lack of financial incentives for some major players in health care such as hospitals. Noting that cardiac patients can be monitored at home for a fraction of the cost of occupying a hospital bed, he said hospitals have “some fear about the financial implications” for their own operations.

Chantal Worzala, director of health information technology at the American Hospital Association, took issue with that suggestion. “The vast majority of cardiac patients are over 65 and are covered by Medicare, which pays a fixed amount, regardless of the length of the hospital stay,” she said.

It’s good that everyone seems to agree: health care reimbursements shouldn’t reward maximal use of expensive hospital beds. And, updating Benjamin Franklin’s maxim, we might soon say that thanks to epidermal electronics, three-thousandths of an ounce of prevention is worth a pound of cure.

Randall Stross is an author based in Silicon Valley and a professor of business at San Jose State University. E-mail:

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Panel Advises F.D.A. to Narrow Its Approval for Avastin

In a series of 6-0 votes, an advisory committee to the Food and Drug Administration endorsed the agency’s proposal to revoke the approval of the drug for use against advanced breast cancer.

The committee members voted that the drug was neither safe nor effective. It also unanimously rejected a proposed compromise offered by the drug’s manufacturer, Genentech, that the approval remain in place while the company conducts another clinical trial to try to confirm that the drug works.

The votes came at the end of an emotional two-day hearing at which about a dozen women, many of whom said the drug was saving their lives, and some cancer support group advocates, pleaded with the F.D.A. and the advisory committee to keep the drug available.

“A panel of six, none of which specialize in metastatic breast cancer, decided that we are statistically insignificant,” Crystal Hanna, one of the patients who testified, said in an e-mail after the vote. “How do I explain that to my 4-year-old and 7-year-old?”

But the members of the advisory committee said the results from clinical trials suggested Avastin was not helping women, though it was exposing them to potentially serious side effects like high blood pressure, gastrointestinal perforations and hemorrhaging.

“The agency has to look at protecting a larger number of patients,” said one committee member, Dr. Ralph Freedman, a gynecologic oncologist at the M. D. Anderson Cancer Center in Houston. “Sometimes they have to make a decision that doesn’t favor individual patients, but it’s on the basis of the whole.”

Avastin received so-called accelerated approval for metastatic breast cancer in 2008 under a program that allows drugs for serious diseases to reach the market quickly, subject to further study.

The F.D.A. said in December that these later studies had not confirmed the initial findings that Avastin was effective, so the agency proposed to revoke the approval. The hearing this week, which took place on the F.D.A. campus in Silver Spring, Md., was to hear Genentech’s appeal.

The final decision will be made by the commissioner of the F.D.A., Dr. Margaret A. Hamburg. She is not obligated to follow the advice of the committee.

Genentech, a subsidiary of Roche, and some patient groups are trying to bring Congressional pressure to bear on the F.D.A. At a time of controversy over the federal health care legislation, the Obama administration might not want to provoke renewed accusations of rationing care, which had been leveled during earlier stages of the agency’s deliberations over revocation.

Edward Lang Jr., a spokesman for Genentech, said the company would propose some middle grounds to the F.D.A., like restricting use of the drug to aggressive cancers or changing the drug’s label.

Genentech might also challenge an unfavorable decision in court.

Even if the breast cancer approval is withdrawn, Avastin will remain on the market as a treatment for several other types of cancer, so doctors could use it off label to treat breast cancer. But insurers might be less likely to pay, which would put Avastin, which costs about $88,000 a year, out of reach for most patients.

Even that is not certain. Medicare is supposed to pay for off-label uses of cancer drugs listed in references called compendia. One such compendium, published by the National Comprehensive Cancer Network, reaffirmed support for Avastin last year.

Still an explicit rejection of the drug by the F.D.A. might prompt the compendia to re-evaluate the drug or prompt insurers to ignore the compendia.

“My own guess is that third-party payers, including Medicare and Medicaid, would look at the F.D.A. decision and say this is a special circumstance,” said Dr. Harold J. Burstein of the Dana-Farber Cancer Institute in Boston. Dr. Burstein, who is on the cancer network’s breast cancer guidelines committee, said he did not know if the committee would re-examine Avastin at its annual meeting next month.

Avastin is the world’s best-selling cancer drug, with sales last year of roughly $7 billion. Analysts have estimated that loss of the breast cancer indication could cost Roche as much as $1 billion a year.

Sales of Avastin have already started dropping as doctors use it less. Mr. Lang, the Genentech spokesman, said that only 20 percent to 25 percent of eligible breast cancer patients in the United States were now receiving the drug, down from 60 percent a year ago. There are about 29,000 new cases a year of the type of breast cancer for which Avastin is approved, he said.

The committee’s votes on Wednesday were not surprising given that five of the six members voted the same way last July, when the committee initially recommended the approval be revoked.

The trial that led to approval indicated that Avastin, when combined with the chemotherapy drug paclitaxel, delayed the median time before tumors got worse by 5.5 months compared with paclitaxel alone.

But in two subsequent studies, Avastin delayed tumor progression by only 1 to 3 months. And none of the studies, including the original one, showed Avastin prolonged women’s lives or improved the quality of their lives.

“We’ve tried to slice this pie in a lot of different ways to try to find some kind of benefit for this drug,” said one committee member, Dr. Mikkael Sekeres of the Cleveland Clinic. “All we’re left with are crumbs.”

Genentech argued that subsequent trials might not have shown as large a benefit because Avastin had been combined with different chemotherapy drugs. It said the approval should remain in place while it conducted another study in which Avastin would be combined with paclitaxel, as in the original study.

“The law provides this flexibility and this middle course best meets the purposes of accelerated approval to facilitate needed treatment options,” Michael S. Labson, a lawyer representing Genentech, told the committee.

But the trial would take several years. Committee members suggested that the F.D.A. had to act to maintain the integrity of the accelerated approval program.

“We have a standard,” said Dr. Wyndham Wilson of the National Cancer Institute, a committee member, “and we shouldn’t be changing that standard unless we have a very good reason.”

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Johnson & Johnson to Stop Making Heart Stents

Johnson and Johnson announced on Wednesday that it would stop manufacturing drug-coated heart stents by the end of the year, abandoning an intensely competitive $4 billion market after a series of setbacks for the company and rising concerns about the use of stents in some patients.

The company is expecting to take a $500 million to $600 million restructuring charge this quarter and to trim 900 to 1,000 jobs this year.

The announcement by J. J. and its subsidiary Cordis, long expected by some analysts because of a dwindling market share, opens up more sales possibilities for three competitors.

The use of heart stents is being challenged as unnecessary for some patients. Stents are tiny devices inserted through blood vessels to keep arteries open in the heart. But research in recent years has suggested that stents are overused by doctors and that drugs may be a cheaper, safer and more effective way for many patients to avoid heart attacks or strokes.

The emerging concerns, the recession and pricing pressures have caused a fall-off in stent sales. The worldwide market for coronary stents dropped to $4.2 billion last year, from $5.3 billion in 2006, according to the investment house Leerink Swann.

Cordis’s sales of drug-coated heart stents fell to $627 million globally last year, from $2.6 billion in 2006. By the end of the year, Cordis will stop manufacturing its Cypher stent — the first drug-coated stent to be approved by the Food and Drug Administration in 2003 — and stop researching a new one called the Nevo stent, the company said in a statement Wednesday.

Seth Fischer, worldwide chairman of Cordis, said the decision was prompted by “changing dynamics” and price pressures in an increasingly competitive market.

“There’s no question that our market share has declined in the last several years as competitors have joined the market,” he said in a telephone interview. “We felt that we could turn our attention toward other potential areas that would enhance cardiovascular health for patients.”

Mr. Fischer also said J. J.’s losses in patent cases, including an appellate court decision last week, had a significant effect. “Unlicensed competition” has eroded its pricing, sales and market share, he said.

Cordis will cut 900 to 1,000 positions by closing its Cypher stent manufacturing facility in San Germán, Puerto Rico, and its Nevo stent plant in Cashel, Ireland, and trimming research, sales and marketing, a company spokeswoman, Sandra Pound, said in a telephone interview.

J. J., based in New Brunswick, N.J., has suffered a series of consumer product recalls largely because of manufacturing problems. The decision to get out of the stent market also appeared to hurt the company in the eyes of investors. The stock price dipped by 1.4 percent to $66.16 on Wednesday.

J. J.’s departure should help the market leaders, Boston Scientific and Medtronic, which are each introducing new drug-eluting stents in mid-2012, according to an investor note from Barclays Capital.

Boston Scientific stock rose 2.8 percent to $6.93, while Medtronic declined by nearly 1.25 percent, to $37.92. Abbott Laboratories, which also sells heart stents in the United States, held even in the stock market.

J. J. held about 15 percent of the worldwide market share in drug-eluting stents. Barclays said that share was expected to drop to 10 percent this year and 7 percent in 2012.

Leerink Swann, in an investor note, said J. J.’s withdrawal was long expected and would both help other stent-makers and help J. J. focus on more profitable areas.

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