Tornado Alley (PROG)

[F6]

Capital Wins, Labor Loses, But Andrew Smithers Says It Can't Go On


December 26, 2012
http://www.pbs.org/newshour/businessdesk/2012/12/capital-wins-labor-loses-but-a.html [with comments]


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Finance Stocks Dominate The Market In 2012 Despite Continuous Fines, Scandals And Fraud (CHART)

12/28/2012
http://www.huffingtonpost.com/2012/12/28/finance-stocks-2012-fines-scandals-fraud_n_2366090.html [with comments]


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Major banks close to big settlement on home loans


A sign offering bank owned homes for sale is seen in a subdivision in Maricopa, Arizona in this file photo from May 27, 2009.
Credit: Reuters/Joshua Lott/Files

Mon Dec 31, 2012 12:07pm EST

(Reuters) - U.S. regulators are close to securing another multibillion-dollar settlement with the largest banks to resolve allegations that they unlawfully cut corners when foreclosing on delinquent borrowers, a source familiar with the talks said.

The settlement with five big banks would be part of a larger deal that the Office of the Comptroller of the Currency hopes will include 14 banks and total about $10 billion, the source said.

Such a settlement would address an outstanding issue that was left unsettled after the $25 billion deal that the banks reached in February with the Justice Department, housing authorities, and state attorneys general.

In 2011, the OCC had separately required the big banks to "look back" and compensate borrowers wrongfully foreclosed upon in 2009 and 2010. It appears that the case-by-case analysis is proving too cumbersome, and the banks are instead opting for a lump-sum settlement.

The top five mortgage lenders -- Bank of America Corp, Wells Fargo & Co, JPMorgan Chase & Co, Citigroup Inc and Ally Financial Inc -- may reach a deal in the coming days, the source said.

The largest banks would pay the majority of the $10 billion target. That money would be paid out to a group of borrowers foreclosed upon during the period of time covered by the review, said the source, who was not authorized to speak publicly.

The OCC and the banks are still negotiating how to calculate individual payouts, the source said, adding that regulators will give the banks credit for compensation they have already given borrowers as part of ongoing foreclosure reviews.

The New York Times first reported the pending deal.

"The Office of the Comptroller of the Currency is committed to ensuring the Independent Foreclosure Review proceeds efficiently and to ensuring harmed borrowers are compensated as quickly as possible," the OCC said in a statement.

Ally, Wells Fargo, JPMorgan, Bank of America and Citigroup declined to comment.

(Reporting by Aruna Viswanatha, with additional reporting by Sakthi Prasad, Rick Rothacker and Douwe Miedema; Editing by Leslie Gevirtz)

Copyright 2012 Thomson Reuters

http://www.reuters.com/article/2012/12/31/us-mortgage-settlement-idUSBRE8BU09R20121231 [with comments]


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Big Depositors Seek a New Safety Net


Frank Sorrentino, chief of North Jersey Community Bank, where some deposits have extra protection.
Benjamin Norman for The New York Times

By NATHANIEL POPPER and JESSICA SILVER-GREENBERG
Published: December 30, 2012

On the first day of the New Year, $1.5 trillion of bank deposits will lose an unlimited government guarantee that was granted during the financial crisis to assure skittish customers that their cash was safe. For a handful of boutique firms that service banks, it’s a boon for business.

The accounts losing the insurance are used by businesses, municipalities and other entities like nonprofits that are willing to forgo any interest in order to have immediate access to their large pools of cash.

These accounts hold about 20 percent of all deposits in United States banks. Starting Jan. 1, only $250,000 in each noninterest bearing account will be backed by the Federal Deposit Insurance Corporation [ http://topics.nytimes.com/top/reference/timestopics/organizations/f/federal_deposit_insurance_corp/index.html ].

Now a scramble is under way to make sure these customers do not withdraw large sums out of banks, particularly community banks that have benefited from the guarantee. Because a depositor is barred from spreading out $1 million into four accounts within the same bank, many smaller banks are turning to a handful of specialized cash-management firms that can split up deposits into multiple $250,000 chunks and distribute them among a network of banks, each of which can insure $250,000.

One firm doing this parceling work, Reich & Tang, has had an influx of 25 new banks in the last few weeks sign up for the program, a 20 percent growth. Deposits managed by another firm, StoneCastle Cash Management, have surged to roughly $3 billion from just over $2 billion in September. “Interest has picked up dramatically,” said Joshua Siegel, managing principal of StoneCastle.

The end of the unlimited insurance, known as the Transaction Account Guarantee, is the latest twist in the government’s effort to scale back its support for the financial system, and the banking industry’s effort to mute the impact of the new lower limits.

Many analysts assume that even with the end of the government guarantee, the vast majority of the deposits will remain in the banks because the government will continue serving as some sort of backstop for most of the $1.5 trillion.

For small banks, there are programs like Reich & Tang’s, with the government fully insuring the scattered deposits. For the nation’s largest banks, there is a widely shared assumption that the government would be forced to provide a backstop to protect depositors in a crisis, as it did in 2008.

“Implicitly or explicitly, most of this money is going to still be guaranteed,” said Bruce Hinkle, an executive with Farin & Associates, a consulting firm that works with banks.

The unlimited guarantee was created in the depths of the crisis by the Federal Deposit Insurance Corporation, in order to stop a migration of customers from smaller banks to larger ones that were viewed as less likely to fail.

Most individual savers keep their money in interest-bearing accounts, where since the crisis the insurance coverage was raised to $250,000 from $100,000. Some families have gotten around the insurance limit by dividing money into separate $250,000 accounts under the names of different family members.

Firms like Reich & Tang will do this more systematically for wealthy clients. The end of the unlimited guarantee for corporate and municipal depositors is set to significantly increase business at these firms.

Mr. Siegel, managing principal of StoneCastle, which runs one of the largest programs, said he had seen a tenfold increase in interest from community banks in the last month. Begun in 2011, the service, called the Federally Insured Cash Account program, distributes large deposits throughout a network of roughly 500 banks.

StoneCastle and other firms make money by charging banks a small percentage of any deposits they distribute, generally less than 0.2 percent.

Frederick L. Cannon, a bank analyst at Keefe Bruyette & Woods, says that the expansion of the practice from wealthy individuals to corporate customers makes the F.D.I.C.’s limits toothless and exposes the government to more risk if banks fail in the future.

“You want these limits so there is some kind of market discipline on these banks,” said Mr. Cannon. “If I were on the F.D.I.C. board, I would be concerned about this.”

The F.D.I.C. has not taken any position on the cash management companies, but a spokesman said that it was important to ensure strict record-keeping to preserve a full accounting of where the deposits ended up.

Tom Nelson, the chief investment officer at Reich & Tang, said that by spreading money among banks, his firm and others like it increased the stability of the banking system and that the practice “reduces the risk of runs on banks.”

The F.D.I.C. guarantee was one of a number of factors that encouraged depositors to shift money into noninterest bearing accounts after the crisis. Since 2011, when the account guarantee program was extended as part of the Dodd-Frank financial regulation [ http://topics.nytimes.com/topics/reference/timestopics/subjects/c/credit_crisis/financial_regulatory_reform/index.html ] law, the amount of money in such accounts rose by 70 percent, or $678 billion, according to Alex Roever, a JPMorgan Chase analyst.

The vast majority of the holdings in these accounts are above the $250,000 limit and are held in the nation’s largest banks. That money is expected to stay put no matter what, in part because corporations and municipalities widely believe that the government will step in if those large banks encounter trouble, effectively considering them too big to fail.

In recent months, as the deadline loomed, community banks lobbied fiercely for the program to be extended, arguing that it helped level an uneven playing field that favored large banks. The smaller banks said that without the unlimited guarantee, the nation’s largest banks would win an even greater concentration of total customer deposits. Congressional leaders at first appeared ready to continue the guarantee, but this December decided against it, saying that it threatened to allow more bank bailouts.

Before the latest financial crisis wiped out hundreds of banks and left Wall Street teetering on the brink of collapse, many depositors were comfortable keeping large sums in accounts even if there was no government guarantee. But with the memory of bank failures still fresh, customers are more aware of the inherent risks involved.

Frank Sorrentino, the chairman and chief executive of North Jersey Community Bank in Englewood Cliffs, N.J., signed up with StoneCastle to have a product in place to offer any worried corporate clients.

The insurance “isn’t even dead yet and it’s just nice to know that we have an answer for any clients that are concerned,” Mr. Sorrentino said. The bank, where 7 percent of its $724 million in deposits are in T.A.G.-insured accounts, also has been approached by other firms pitching the cash management service. So far, Mr. Sorrentino has said that only a handful of clients have asked about how the insurance expiration might imperil their cash. With the cash management option in place, he said he was confident that money would stay with his bank. Bank analysts at FBR Capital Markets estimate that concerned depositors may move around $250 billion out of the noninterest bearing accounts in the coming months, most of it from smaller banks to money market funds, which received a government safety net during the crisis, or to larger banks.

But other banking analysts say that the doomsday predictions of community banks are overblown. Mr. Cannon of Keefe Bruyette said that institutional investors were unlikely to move large sums because the waves of cheap funds for banks have decreased the chances that community banks will encounter any trouble. What is more, Mr. Cannon said, the government ended up standing behind a large proportion of even the uninsured deposits at banks that failed.

Jeffrey Esser, the executive director of the Government Finance Officers Association, said that his organization had made municipal treasurers aware of the end of the unlimited guarantee, but few had expressed alarm.

Mr. Cannon said he expected that if money did move, it would go into ultrasafe Treasury securities [ http://topics.nytimes.com/top/reference/timestopics/organizations/t/treasury_department/treasury_securities/index.html ] and mortgage-backed bonds that pay at least some interest. Economists at Goldman Sachs said recently this flow of money could exert a further downward pressure on the yield offered by the benchmark 10-year Treasury note, which has dropped to 1.7 percent from around 5 percent before the crisis.

The biggest winners could be the cash management providers. Mr. Hinkle, the executive with bank consultancy Farin & Associates, said that the largest such program was run by the Promontory Financial Group, which will take a maximum of $50 million from each customer and spread it among a network of 2,500 banks. A spokesman for Promontory did not return calls for comment.

Steve Shear, who heads up cash management at First Western Trust in Colorado, said he decided to sign up for Reich & Tang’s program in recent months as it became clear that the guarantee program would not be expanded. While his customers did not have the deposits insured five years ago, the crisis has made them accustomed to the government backstop.

“Even though it’s only been in place for the last four years, people have grown very accustomed to having that security blanket,” said Mr. Shear. “Having that insurance is a nice safety net.”

© 2012 The New York Times Company

http://www.nytimes.com/2012/12/31/business/a-rush-to-split-up-big-bank-deposits-to-keep-them-safe.html [ http://www.nytimes.com/2012/12/31/business/a-rush-to-split-up-big-bank-deposits-to-keep-them-safe.html?pagewanted=all ]


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Questcor Finds Profits, at $28,000 a Vial


Minh Uong/The New York Times


Christina Culver with her son Tyler, 6, at home in Colorado Springs this month. In 2007, Tyler was hospitalized when the price of Acthar soared.
Kevin Moloney for The New York Times


Soon after taking over at Questcor, Don M. Bailey sharply raised the price of Acthar to reposition it as a specialty drug to treat infantile spasms.
J. Emilio Flores for The New York Times


New uses for Acthar represent multibillion-dollar opportunities for the drug and for Questcor, its sole maker.

By ANDREW POLLACK
Published: December 29, 2012

ANAHEIM, Calif.

THE doctor was dumbfounded: a drug that used to cost $50 was now selling for $28,000 for a 5-milliliter vial.

The physician, Dr. Ladislas Lazaro IV, remembered occasionally prescribing this anti-inflammatory, named H.P. Acthar Gel, for gout [ http://health.nytimes.com/health/guides/disease/acute-gouty-arthritis/overview.html ] back in the early 1990s. Then the drug seemed to fade from view. Dr. Lazaro had all but forgotten about it, until a sales representative from a company called Questcor Pharmaceuticals [ http://www.questcor.com/ ] appeared at his office and suggested that he try it for various rheumatologic conditions.

“I’ve never seen anything like this,” Dr. Lazaro, a rheumatologist in Lafayette, La., says of the price increase.

How the price of this drug rose so far, so fast is a story for these troubled times in American health care — a tale of aggressive marketing, questionable medicine and, not least, out-of-control costs. At the center of it is Questcor, which turned the once-obscure Acthar into a hugely profitable wonder drug and itself into one of Wall Street’s highest fliers.

At least until recently, that is. Now some doctors, insurance companies and investors are beginning to have doubts about whether the drug is really any better than much cheaper alternatives. Short-sellers have written scathing criticisms of the company, questioning its marketing tactics [ http://thestreetsweeper.org/undersurveillance/Questcor__The_Secret_behind_Its__Miracle__Drug ] and predicting that its shareholders [ http://www.citronresearch.com/wp-content/uploads/2012/07/citron-qcor.pdf ] are highly vulnerable.

That Acthar is even a potential blockbuster is a remarkable turn of events, considering that the drug was developed in the 1950s by a division of Armour & Company, the meatpacking company that once ruled the Union Stock Yards of Chicago. As in the 1950s, Acthar is still extracted from the pituitary glands of slaughtered pigs — essentially a byproduct of the meatpacking industry.

The most important use of Acthar has been to treat infantile spasms, also known as West syndrome, a rare, sometimes fatal epileptic disorder that generally strikes before the age of 1.

For several years, Questcor, which is based in Anaheim, lost money on Acthar because the drug’s market was so small. In 2007, it raised the price overnight, to more than $23,000 a vial, from $1,650, bringing the cost of a typical course of treatment for infantile spasms to above $100,000. It said it needed the high price to keep the drug on the market.

“We have this drug at a very high price right now because, really, our principal market is infantile spasms,” Don M. Bailey, Questcor’s chief executive [ http://www.questcor.com/about-questcor/board-directors/don-m-bailey ], told analysts in 2009. “And we only have about 800 patients a year. It’s a very, very small — tiny — market.”

Companies often charge stratospheric prices for drugs for rare diseases — known as orphan drugs — and Acthar’s price is not as high as some. Society generally tolerates those costs to encourage drug companies to develop crucial, possibly lifesaving drugs for these often neglected diseases.

But Questcor did almost no research or development to bring Acthar to market, merely buying the rights to the drug from its previous owner for $100,000 in 2001. And while the manufacturing of Acthar is complex, it accounts for only about 1 cent of every dollar that Questcor charges for the drug.

Moreover, the tiny “orphan” market soon became much bigger. Before long, Questcor began marketing the drug for multiple sclerosis [ http://health.nytimes.com/health/guides/disease/multiple-sclerosis/overview.html ], nephrotic syndrome [ http://health.nytimes.com/health/guides/disease/nephrotic-syndrome/overview.html ] and rheumatologic conditions, even though there is little evidence that Acthar is more effective for those other conditions than alternatives that are far cheaper. And the company did so without being required to prove that the drug actually works. That is because Acthar was approved for use in 1952, before the Food and Drug Administration required clinical trials to show a drug is effective for a particular disease. Acthar is essentially grandfathered in.

Today, only about 10 percent of the drug’s sales are for infantile spasms. The new uses, Mr. Bailey has told analysts, represent multibillion-dollar opportunities for Acthar and Questcor, its sole maker.

The results have been beyond even the company’s wildest dreams. Sales of Acthar, which accounts for essentially all of Questcor’s sales, totaled nearly $350 million in the first nine months this year, up 145 percent from the period a year earlier. In the same period, Questcor’s earnings per share nearly tripled, to $2.12. In the five years after the big Acthar price increase in August 2007, Questcor shares rose from around 60 cents to about $50, in one of the best performances of any stock in any industry.

But in September, the shares plummeted after Aetna, the big insurer, said it would no longer pay for Acthar, except to treat infantile spasms, because of lack of evidence the drug worked for other diseases. The stock now trades at $26.93.

Peter Wickersham, senior vice president for cost of care at Prime Therapeutics [ http://www.primetherapeutics.com/index.html ], a pharmacy benefits manager that has found the drug is possibly being overused [ https://cdn2.content.compendiumblog.com/uploads/user/e7c690e8-6ff9-102a-ac6d-e4aebca50425/736243c9-46fe-420e-b8a6-6d0faaba1a66/File/cc923cad7abb16b286e690457749aa08/5287_acthargel_casestudy.pdf ], says the huge increase in Acthar’s price for patients “just invites the type of scrutiny that it’s received.”

Questcor, meanwhile, has disclosed that the United States attorney’s office in Philadelphia is investigating its marketing practices. The company hasn’t been accused of wrongdoing.

Mr. Bailey, Questcor’s C.E.O., defends his company’s practices. He says that when Questcor raised Acthar’s price, it did not initially intend to market the drug for other uses. It simply responded to demand. “Nobody predicted this,” he said. “Nobody.”

He also says that Questcor isn’t competing with low-price alternatives, but that it is marketing the drug as a treatment when those alternatives fail. Used that way — for instance, as a last chance to avert kidney failure [ http://health.nytimes.com/health/guides/disease/acute-kidney-failure/overview.html ] — insurers are still paying for the drug at least 85 percent of the time, he says.

Still, given that Questcor is now pursuing billion-dollar opportunities far beyond the treatment of infantile spasms, is the high, orphan-drug price still justified?

“We could lower the price and make less money,” Mr. Bailey says, “and then we would be sued by our shareholders.”

Whatever the case, one group of shareholders has done pretty well for itself. Over the last two years, as the company’s share price mainly soared, Questcor insiders have sold more than $100 million of stock.

THE story of Questcor’s wonder drug begins in Rochester, Minn. It was there, at the Mayo Clinic, that Dr. Philip S. Hench [ http://www.nobelprize.org/nobel_prizes/medicine/laureates/1950/hench.html ] spent more than 20 years searching for what he called Substance X.

Dr. Hench, a rheumatologist, hypothesized that the body could make a compound that stilled the immune system’s attacks on the joints of people with rheumatoid arthritis [ http://health.nytimes.com/health/guides/disease/rheumatoid-arthritis/overview.html ].

It turned out that another Mayo researcher, Dr. Edward C. Kendall [ http://www.nobelprize.org/nobel_prizes/medicine/laureates/1950/kendall.html ], had isolated six hormones made by the adrenals, the small glands atop the kidneys that are chiefly responsible for releasing stress hormones. When a few patients were injected with one of the hormones in 1948, their symptoms subsided.

But that hormone, now known as cortisone, was then hard to synthesize. So Dr. Hench thought of injecting another substance that would stimulate the body to produce its own cortisone and other steroid [ http://topics.nytimes.com/top/news/health/diseasesconditionsandhealthtopics/steroids/index.html ] hormones. That substance was adrenocorticotropic hormone [ http://health.nytimes.com/health/guides/test/acth/overview.html ], or ACTH, which is made by the pituitary gland.

Dr. Hench obtained some ACTH from the Armour meatpacking company, which was extracting it from pigs as part of an effort to develop markets for leftover animal parts. (Its big success was Dial soap, introduced in 1948.)

When ACTH was injected into the first arthritis [ http://health.nytimes.com/health/guides/disease/arthritis/overview.html ] patient in February 1949, the results were as good as with cortisone, spurring a huge spike in demand for animal glands. By 1950, thousands of patients, not only those with arthritis but also those with gout, lupus [ http://health.nytimes.com/health/guides/disease/systemic-lupus-erythematosus/overview.html ], ulcerative colitis [ http://health.nytimes.com/health/guides/disease/ulcerative-colitis/overview.html ] and many other diseases, had been treated with either cortisone or ACTH.

That year, Dr. Hench, Dr. Kendall and a third scientist were awarded the Nobel Prize [ http://www.nobelprize.org/nobel_prizes/medicine/laureates/1950/ ] in medicine.

In 1952, Armour won approval from the F.D.A. for H.P. Acthar Gel, or “highly purified” ACTH mixed with gelatin (another animal byproduct) to make it last longer in the body and require fewer injections. The label said the drug could be used to treat about 50 diseases.

But by the 1980s, drug companies had learned to synthesize steroids like prednisone, and those became the treatment of choice. In 1995, when the F.D.A. found numerous quality control problems at the factory manufacturing Acthar, the drug’s owner at the time, Rhône-Poulenc Rorer, decided to discontinue the product rather than invest in manufacturing improvements.

That decision provoked an outcry from some patient groups and pediatric neurologists, who said the drug was the best treatment for infantile spasms. So Rhône-Poulenc, which became Aventis after a merger, continued to make a limited supply that was rationed to treat only infantile spasms or severe flare-ups of multiple sclerosis. With Aventis losing several million dollars a year on the drug, on sales of only about a half-million dollars, the company looked for a way out.

It sold the drug in 2001 to Questcor for $100,000 as well as a 1 percent royalty on annual sales over $10 million. At the time, Questcor, formed by a merger of two small companies in 1999, was losing money and looking for drugs to market. With help from Aventis, Questcor set up its own, somewhat more modern manufacturing through a contractor on Prince Edward Island, Canada.

Questcor immediately raised the price of Acthar to $700 a vial, from $40, and the price rose gradually after that. By the end of 2006, Acthar sales were about $12 million a year, but the company was still losing money.

In May 2007, James L. Fares, left as chief executive and was replaced, initially on an interim basis, by Mr. Bailey, who had joined the board a year earlier. A mechanical engineer by training, Mr. Bailey had retired in 2000 from a 10-year run as chief executive of Comarco, a military contractor and telecommunications concern.

Three months later, Questcor announced the huge price jump, aimed at repositioning Acthar as a specialty drug. The move prompted protests from parents and pediatric neurologists.

“It made us so sick to the stomach — just the fact that something like that could happen overnight with a drug my child needed to live,” says Christina Culver of Colorado Springs. “It’s just like someone saying, ‘I’m going to charge you for oxygen now.’ ”

Ms. Culver’s son Tyler was in the hospital, being treated for infantile spasms, just as the price increase hit. Tyler was due to leave the hospital, and Ms. Culver and her husband, Randy, were to continue the injections at home. Then the Culvers’ insurer, Blue Cross Blue Shield, refused to pay the new high price. After a storm of publicity, the insurer backed down.

Questcor, however, hasn’t, and has continued to raise the price, now at more than $28,400 a vial. Insurers generally pay for Acthar because it is considered the best treatment for infantile spasms. They also tend to pay for other approved uses if cheaper drugs have been tried first. And Questcor has carefully executed the orphan-drug playbook. Patients who cannot pay are given the drug free. The company helps with insurance co-payments, to make sure that a patient’s inability to make a co-payment doesn’t stand in the way of the drug being used and the insurer paying $28,000 a vial.

In other words, Questcor shifts the cost onto insurance companies while staving off consumer protests. It has a staff of 30 people who do nothing but work on insurance reimbursements — about one staff member for each of the roughly 30 prescriptions [ http://health.nytimes.com/health/guides/specialtopic/getting-a-prescription-filled/overview.html ] it gets in a typical day for all uses.

Questcor executives argue that with the free drug program and the ample supply, patients have better access to Acthar now than when it was cheaper and often in short supply.

“We believe we’ve been good stewards of this product,” Mr. Bailey says.

Dr. Lawrence Brown, a neurologist [ http://www.chop.edu/doctors/brown-lawrence-w.html ] at the Children’s Hospital of Philadelphia [ http://www.chop.edu/ ] and the president of the Child Neurology Foundation [ http://www.childneurologyfoundation.org/ ], says of Questcor: “They have gone out of their way to help every kid who needs the medicine to get it quickly and efficiently.”

This year, the foundation awarded its first corporate citizenship award to Questcor. Dr. Brown says Questcor’s donations — the amount has not been disclosed — to the foundation didn’t influence the award.

STILL, the price remains a sticking point.

At Children’s National Medical Center in Washington, “we’ve been instructed not to hospitalize a child with spasms unless the authorization has been procured to pay for it,” said Dr. Phillip L. Pearl, chief of child neurology [ http://www.childrensnational.org/research/faculty/bios/cnr/pearl_p.aspx ]. In practice, however, no child has been turned away.

Dr. Shaun Hussain of Mattel Children’s Hospital [ http://www.uclahealth.org/homepage_mattel.cfm ] in Los Angeles said that the studies showing Acthar to be better than far cheaper steroids used too low a dose of steroids.

At his hospital, he reported at a medical meeting this month, 18 of 30 babies were successfully treated with two weeks’ worth of a high-dose oral steroid. Only the 12 who did not respond were switched to Acthar, with five of them successfully treated.

Given that the steroids cost $200 for each baby, compared with about $125,000 for Acthar, the approach saved more than $2 million. “We have to look at the cost to the health care system,” Dr. Hussain said.

Mr. Bailey says the new price was set to make the company viable based solely on sales for infantile spasms. Executives assumed at the time that the high price would preclude other uses.

But to Questcor’s surprise, he says, some prescriptions continued to trickle in to treat the periodic flare-ups that plague people with multiple sclerosis.

So Questcor began hiring sales representatives to promote the drug for that use. Then it hired a sales force to promote the drug as a treatment for nephrotic syndrome, a kidney injury [ http://health.nytimes.com/health/guides/disease/injury-kidney-and-ureter/overview.html ] that can lead to kidney failure. In June, it began selling to rheumatologists.

For all these diseases, there are cheaper alternatives. Oral prednisone, which might be used for some rheumatological diseases, can cost $10 a month. Intravenous steroids, used to treat multiple sclerosis flares, cost several hundred dollars.

Because Acthar was approved for these conditions decades ago, Questcor has not had to do large clinical trials to show that the drug works. It has paid for some small studies, mainly by individual doctors, who then publish a paper that the sales force can present to doctors.

The study that justified calling on rheumatologists involved five patients with rare conditions, all of them treated by a single doctor. All the patients had much improvement on Acthar after failing to benefit from more standard therapies, the doctor, Todd Levine, said in a Questcor conference call.

Still, it appears that at least a couple of small studies that may have raised questions about the drug have been suspended.

“From my standpoint it just didn’t work,” said Dr. Sungchun Lee, a Phoenix nephrologist who stopped a small study testing Acthar as a treatment for nephrotic syndrome. “I think they were O.K. with me stopping because we weren’t getting the results,” he said.

Another study that was terminated sought to determine whether multiple sclerosis patients who did not have a good response to steroids should be treated with either another round of steroids or with Acthar. The study was halted midway through “to analyze data,” according to the summary of the trial [ http://clinicaltrials.gov/ct2/show/NCT00947895 ] on the federal clinical trial database.

A negative result could have jeopardized already growing sales for multiple sclerosis. The company says the trial fell hopelessly behind its goal in recruiting patients.

Given the scarce data, and the high price, most doctors do not use Acthar for multiple sclerosis, nephrotic syndrome or rheumatology.

“It’s absurd,” says Dr. Douglas R. Jeffery, a multiple sclerosis specialist in Advance, N.C. “There’s never a clinical setting where I can justify spending $23,000 to treat an M.S. relapse.”

But some doctors say Acthar can be effective in cases that are not well treated by steroids. They say that there is emerging evidence that Acthar does more than just stimulate the body to produce its own steroids.

“It really looks like the ACTH does bring something different to the table that standard steroids don’t,” said Dr. Ben W. Thrower [ http://www.shepherd.org/about/medical-staff/28 ], director of the multiple sclerosis institute at the Shepherd Center [ http://www.shepherd.org/ ], a hospital in Atlanta. Dr. Thrower, who is a paid speaker for Questcor, said his institute had tried Acthar for about 60 of its 3,000 patients, ones who did not respond to steroid treatment. Acthar made the symptoms subside in about half of them.

GIVEN Acthar’s price, Questcor does not need many prescriptions to make a good business. A course of treatment for nephrotic syndrome can run $250,000, while a shorter treatment for a multiple sclerosis relapse typically costs $40,000.

Questcor sales representatives who are lucky enough or skillful enough to have a big prescriber in their territory can reap bonuses of $50,000 a quarter, according to former employees of the company.

Executives are paid well, too. In 2009, Mr. Bailey hired his daughter Kirsten Fereday as director of business analytics and evaluation, a job that paid $275,000 in cash and stock last year.

Mr. Bailey and Steve Cartt, Questcor’s chief operating officer [ http://www.questcor.com/about-questcor/management-team/steve-cartt ], say the company’s marketing has been aboveboard and that the company is now starting to sponsor more studies. “This wasn’t possible until the drug was financially viable,” Mr. Bailey said.

Patients report mixed results. Sharon Keller of Austin, Tex., who has nephrotic syndrome, tried Acthar after two other drugs had not worked. But she stopped, she says, because side effects including mood swings and weight gain were “much worse than I’d ever experienced.”

“I almost had to fight with my doctor not to push it on me,” Ms. Keller, 59, says. She says her insurer was charged $130,000 for her drug, including a vial she did not use. “I have a Cadillac in my refrigerator,” she says of that leftover vial.

ONE big uncertainty hanging over Questcor is competition. As an old drug without patent protection, Acthar would seem to be a sitting duck for generic rivals. And other versions of ACTH have been sold in the past.

Yet Questcor is now arguing that its studies show that Acthar, despite the “highly purified” in its name, actually contains other substances from the pig pituitary glands that account for some of its effectiveness. The company does not intend to say what those other ingredients are, thus making it extremely hard for a generic company to copy Acthar.

“Coca-Cola is not going to tell you what Coke contains, either,” Mr. Bailey says.

Whether such an argument will work remains to be seen. Even if it does, competitors could still sell other forms of ACTH. Novartis, which sells a synthetic version called Synacthen in Europe, has applied for a United States trademark, a sign that the drug might be brought to this country.

A small Maryland company, Cerium Pharmaceuticals, recently won orphan-drug designation from the F.D.A. for Synacthen to be used to treat infantile spasms. But that does not necessarily mean that Cerium has the rights to the drug or intends to market it.

Cerium is run by Gregg Lapointe, a former Questcor board member. He declined to comment for this article.

Still, Synacthen, or other versions of ACTH, might have to go through lengthy trials before being approved, and would have to be approved for one disease at a time.

So there is at least a chance that Questcor might maintain its high-priced dominance for a long time. In the meantime, the company plans to systematically expand the marketing of the drug to treat other diseases, starting with those already on the label.

Given that Acthar has many potential uses, Mr. Bailey says, Questcor sees no reason to come up with other drugs. The company has been buying back its stock, helping to underpin the price, and recently said it would start paying a dividend.

“We’ll take it where it goes,” Mr. Bailey says of Acthar. “It’s taken us to places we never expected.”

© 2012 The New York Times Company

http://www.nytimes.com/2012/12/30/business/questcor-finds-profit-for-acthar-drug-at-28000-a-vial.html [ http://www.nytimes.com/2012/12/30/business/questcor-finds-profit-for-acthar-drug-at-28000-a-vial.html?pagewanted=all ]


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Court: Hutterites Must Pay Workers' Compensation

By MATT VOLZ
January 1, 2013

HELENA, Mont.

A sharply divided Montana Supreme Court has ruled that forcing a Hutterite religious colony to pay workers' compensation insurance for jobs outside the commune is not an unconstitutional intrusion into religion.

The 4-3 decision upholds a 2009 law requiring religious organizations to carry workers' compensation insurance, which the Legislature passed after businesses complained they could not outbid the religious workers.

The Big Sky Colony of Hutterites in northwestern Montana sued, saying the law targeted its religion and infringed on its beliefs. Its members have no personal property and make no wages as part of their communal life, which is central to their religious beliefs, and a member can't make a claim against the colony or take money for himself without risking excommunication.

The Hutterites are Protestants similar to the Amish and Mennonites who live a life centered on their religion. But unlike the others, Hutterites live in German-speaking communes scattered across northern U.S. states and Canada. They are primarily agricultural producers but have expanded into construction with success because they can offer lower job bids than many private businesses.

Justice Brian Morris, writing for the majority, said the workers' compensation requirement does not interfere with the Hutterites' religious practices but only regulates their commercial activities like any other business.

He cites numerous cases, from two Native Americans fired for ingesting peyote to Jimmy Swaggart's ministry attempting to avoid paying taxes on selling religious merchandise, as examples in which courts rejected religious organizations' arguments that participation in a government program violated their beliefs.

In a sharply worded dissent, retiring Justice James Nelson wrote the court's decision violates the U.S. and Montana constitutions by allowing the government to interfere with the beliefs of a religious institution only to appease businesses that believed they are at a competitive disadvantage against the Hutterite laborers.

"Apparently, henceforth, 'no law' prohibiting the free exercise of religion does not actually mean 'no law' in Montana. Rather, it means no law, except to the extent that the law greases the squeaky wheel of a powerful industry," Nelson wrote.

Justices Jim Rice and Patricia Cotter also dissented, with Rice saying the decision gives the appearance the law applies equally to all employers, but it is specifically targeted at the Hutterites — noting the legislative debate of the bill focused solely on that religious group.

"Had this been the status of religious freedom in 1620, the Pilgrims may well have sailed right by," Rice wrote.

The ruling doesn't address the religious tenets the Hutterites would be forced to violate to participate in the system, nor does it recognize how intertwined their religion and communal living is, Rice wrote.

Morris wrote that a colony member could refrain from filing a claim or share a claim award with the rest of the colony. Nothing prevents the colony from excommunicating a member who receives compensation and refuses to turn it over, so there is no interference with the religious practices, Morris wrote.

Rice responded that such a system would force the Hutterites to pay insurance for which they would never receive any benefit, "the very definition of illusory coverage that 'defies logic' and violates public policy."

Hundreds of Hutterite colonies are scattered across Canada, from Manitoba to British Columbia. In the U.S., there are colonies in Montana, South Dakota, North Dakota, Minnesota, Washington and Oregon.

There are about 50 colonies in Montana, with an average of about 100 people on each colony, according to a state report from 2010.

Copyright 2012 The Associated Press

http://abcnews.go.com/US/wireStory/court-hutterites-pay-workers-compensation-18108570 [no comments yet]


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Building Congregations Around Art Galleries and Cafes as Spirituality Wanes


The house band started a service one recent Sunday at the Life in Deep Ellum church in Dallas.
Allison V. Smith for The New York Times


Joel Triska, lead pastor.
Allison V. Smith for The New York Times


Rachel Triska, the church's executive director.
Allison V. Smith for The New York Times

By AMY O’LEARY
Published: December 29, 2012

DALLAS — The mural painted on the side of a building in the Deep Ellum warehouse district here is intentionally vague, simply showing a faceless man in a suit holding an umbrella over the words “Life in Deep Ellum.” Inside there are the trappings of a revitalization project, including an art gallery, a yoga studio and a business incubator, sharing the building with a coffee shop and a performance space.

But it is, in fact, a church.

Life in Deep Ellum [ http://www.lifeindeepellum.com/organization/ ] is part of a wave of experimentation around the country by evangelicals to reinvent “church” in an increasingly secular culture, and it comes as the megachurch boom of recent decades, with stadium seating for huge crowds, Jumbotrons and smoke machines, faces strong headwinds. A national decline in church attendance, the struggling economy and the challenges of marketing to millennials have all led to the need for new approaches.

“It’s unsettling for a movement that’s lasted 2,000 years to now find that, ‘Oh, some of the things we always assumed would connect with the community aren’t connecting with everyone in the community in the way they used to,’ ” said Warren Bird [ http://warrenbird.com/ ], the director of research for the Leadership Network, a firm that tracks church trends.

According to a recent report by the Pew Research Center [ http://www.pewforum.org/Unaffiliated/nones-on-the-rise.aspx ], the percentage of Americans who are not affiliated with any religion is on the rise, including a third of Americans under 30. Even so, nearly 80 percent of unaffiliated Americans say they believe in God, and close to half say they pray at least once a month.

The “spiritual but not religious” category is an important audience that evangelical leaders hope to reach in a culture that many believers call “post-Christian.”

So they arrange meetings in movie theaters, schools, warehouses and downtown entertainment districts. They house exercise studios and coffee shops to draw more traffic. Many have even cast aside the words “church” and “church service” in favor of terms like “spiritual communities” and “gatherings,” with services that do not stick to any script.

One Sunday before Easter, the pastor at the Relevant Church [ http://www.relevantchurch.com/ ] in Tampa, Fla., wearing a rabbit suit, whisked the unsuspecting congregation away on chartered buses to a nearby park to build enthusiasm for the coming service.

“For us, it’s all about being interactive,” said Paul Wirth, Relevant’s founder [ http://www.relevantchurch.com/content.php?pid=4&pgname=who-we-are ] and lead pastor.

Although the number of evangelical churches in the United States declined for many years, the trend reversed in 2006, with more new churches opening each year since, according to the Leadership Network’s most recent surveys. This wave of “church planting” has been highest among nondenominational pastors, free to experiment outside traditional hierarchies.

“I hear a lot of pastors say, ‘I’m not just trying to be creative and avant-garde, I think this is maybe the last chance for me,’ ” said Doug Pagitt [ http://dougpagitt.com/ ], the founder of Solomon’s Porch [ http://www.solomonsporch.com/ ] in Minneapolis.

Mr. Pagitt has written several books on church innovations, many of which were first developed in the “emergent” church movement [ http://www.nytimes.com/2007/10/28/magazine/28Evangelicals-t.html?pagewanted=all ] of the last decade or among “missional [ http://missionalchurchnetwork.com/what-is-missional/ ]” churches whose practices focus on life outside the church.

Many of their innovations are being adopted by an increasing number of pastors in the mainstream.

For new leaders coming out of seminary, “the cool thing is church planting,” Mr. Bird said. “The uncool thing is to go into the established church. Why that has taken over may speak to the entrepreneurialism and innovation that today’s generation represents.”

That generation includes Mark Batterson [ http://markbatterson.com/ ], the 43-year-old pastor of National Community Church in Washington.

“If the kingdom of God had departments, we’d want to work in research and development,” Mr. Batterson said.

With 3,000 members, National Community Church is technically a megachurch, according to religion scholars, for whom any congregation over 2,000 qualifies. But with a high turnover rate of nearly 40 percent a year, its continued growth is a noteworthy feat.

Sunday services are held in six locations, mostly movie theaters, where the smell of Saturday night’s popcorn hangs in the air as prerecorded sermons play on the big screen.

The church also runs a coffee shop called Ebenezers near Union Station, where its religious affiliation is hard to detect. Until it ran out of room, it used to hold services in the basement, drawing new members from the coffee drinkers who wandered downstairs to investigate the music.

For Mr. Batterson, the strategy has biblical roots.

“We felt like Jesus didn’t hang out at the synagogue, he hung out at wells,” he said. “Coffeehouses are postmodern wells. Let’s not wait for people to come to us, let’s go to them.”

The church has fielded hundreds of requests from other pastors for insights about its approach, and it has plans to franchise Ebenezers, first in Charlotte, N.C.

These kinds of locations — urban, multipurpose and with plenty of foot traffic — are favored sites, in part because they are less expensive to operate than a sprawling suburban campus. Coffee shops, too, help generate revenue, as do space rentals.

Today, younger pastors are less willing to try to finance multimillion-dollar churches with debt. After the recession, there was a surge in church foreclosures, reaching record highs in 2010 and 2011. Since 2008, more than 300 church properties have been sold after defaulting on their loans, according to the CoStar Group, a real estate information firm.

Building professionals who work with churches say they have seen these shifts firsthand.

“Every generation wants their own thing,” said Houston Clark, whose company designs spaces [ http://www.clark.is/ ] and audiovisual systems for churches nationwide. “Kids in their late 20s to midteens now, they really crave intimacy and authenticity. They want high-quality experiences, but don’t necessarily want them in huge voluminous buildings.”

Five years ago, Mr. Clark said, 90 percent of his business was installing expensive lighting and sound systems for megachurches that could hold up to 5,000. But today, 70 percent of his business is working on existing buildings, like warehouses, to renovate the interiors as multipurpose spaces for churches to operate.

It is a trend that even established megachurches, like Bent Tree Bible Fellowship [ http://www.benttree.org/ ] in Carrollton, Tex., are studying. After paying off $5 million in debt on its 135,000-square-foot facility last year, the church is again seeking to expand. But instead of building another huge campus, church officials are looking at smaller satellite spaces that can operate seven days a week, with services like child care, shared office spaces and a community theater.

“That’s a significant difference for us,” said Paul Miller, the pastor of ministries for Bent Tree. “We’re really building a community center, more than we are a worship center.”

That strategy, blending religion with everyday activities, disarms people put off by traditional notions of church, said Scott L. Thumma, a professor at the Hartford Institute for Religion Research.

“It’s pretty low risk to wander into a bar or movie theater or hotel,” Professor Thumma said. “It ends up delivering the message of relevance: we’re just like you, we’re struggling, we might have a beer together — and our faith is also relevant.”

© 2012 The New York Times Company

http://www.nytimes.com/2012/12/30/us/new-churches-focus-on-building-a-community-life.html [ http://www.nytimes.com/2012/12/30/us/new-churches-focus-on-building-a-community-life.html?pagewanted=all ]


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Belgium To Prosecute Scientology As Criminal Organization; Church Faces Charges Of Extortion, Fraud



By Andres Jauregui
Posted: 12/28/2012 1:48 pm EST | Updated: 12/28/2012 3:48 pm EST

Federal public prosecutors in Belgium will institute legal proceedings against the church of Scientology in that country and seek to recognize it as a criminal organization [ http://www.deredactie.be/cm/vrtnieuws.english/news/121228_Church_of_Scientology_belgium_criminal_organisation_federal_prosecutors ].

The church of Scientology -- which is not recognized as a faith in Belgium -- and several of its top-ranking members face charges including extortion, fraud, illegal practice of medicine and violation of privacy laws, according to Flanders News.

The complaint stems from an investigation of fraudulent labor contracts issued by the church of Scientology in an effort to recruit new volunteers and members. A judge ordered raids on Scientology offices [ http://www.standaard.be/artikel/detail.aspx?artikelid=DMF20121228_00416144 ] in 2008 that allegedly uncovered a "wealth of evidence" that the organization had spied on and extorted money from its members, according to De Standaard.

An estimated 500 people belong to the church of Scientology in Belgium. The organization's European headquarters are located in Brussels.

Belgium is not the only European country in which Scientology has faced criticism and legal action.

Scientology came under fire in France in 2009 when it was convicted of fraud for "[pressuring] members into paying large sums for questionable remedies," according to the Associated Press. That conviction was upheld in a French appeals court [ http://www.cbsnews.com/8301-202_162-57370448/french-court-upholds-scientology-fraud-conviction/ ] in February 2012.

Germany does not recognize Scientology as a faith [ http://www.time.com/time/world/article/0,8599,1695514,00.html ], and a 1997 state-level interior ministry report described the organization's agenda and activities as "marked by objectives that are fundamentally and permanently directed at abolishing the free democratic basic order," Time reported in 2007.

However, also according to Time, many Germans find the question of what qualifies as a religion a personal one and skeptics fear that banning the church outright could backfire, making the organization appear a victim of persecution.

As Tablet Magazine notes, signatories of an open letter to then-Chancellor Helmut Kohl attempted that shift in dialogue [ http://www.tabletmag.com/jewish-news-and-politics/105996/scientology-is-not-a-religion ] in 1996, "likening the German government’s treatment of Scientologists to Nazi barbarism."

"In the 1930s, it was the Jews. Today it is the Scientologists," the letter stated [ http://www.german-way.com/scientad.html ].

Copyright © 2012 TheHuffingtonPost.com, Inc.

http://www.huffingtonpost.com/2012/12/28/belgium-prosecutes-scientology-extortion-fraud_n_2375823.html [with comments]


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Aquino Trumps Catholic Church, Big Tobacco With Twin Laws


Benigno Aquino, president of the Philippines.
Julian Abram Wainwright/Bloomberg

By Norman P. Aquino & Joel Guinto - Dec 20, 2012 12:54 AM CT

Philippine President Benigno Aquino defeated the Catholic Church and the tobacco lobby by using his popularity to push through twin laws to provide free condoms to the poor and boost taxes on cigarette and liquor.

Lawmakers yesterday ratified a reproductive health bill that had been introduced and blocked repeatedly since 1998, and the legislation will be signed into law before the end of the year, Aquino said. The extra revenue from the so-called sin tax will help the country win an investment grade credit rating, Tax Commissioner Kim Henares said today.

Aquino, 52, endured the possibility of excommunication from the church and criticism from boxing champion Manny Pacquiao and former first lady Imelda Marcos to win support for the health bill. His approval rating is the highest for a president since actor Joseph Estrada in 1999, buoyed by efforts to fight corruption and tackle an entrenched culture of tax evasion.

“Aquino managed to resurrect and rally support for controversial measures in which his predecessors had failed,” said Ramon Casiple, executive director of the Manila-based Institute for Political and Electoral Reform. “His advocacy of these bills was personal and more than ministerial. He made good on his promises and proved that he’s reform-oriented.”

Aquino signed the sin tax bill today, touting its health- care benefits and criticizing opponents of the new law.

“Many thought it was impossible to pass the sin tax,” said Aquino, who is a smoker himself. “The enemy was strong, noisy, organized. Those who were against it had deep pockets.”

Sex Education

The reproductive health bill calls for mandatory sex education and requires the government to pay for contraceptives and family planning services for poor people. The United Nations has said it will help reduce poverty among the fifth of the nation’s 104 million people who live in slum conditions.

The contraceptives bill had been refiled and blocked in each three-year congressional term since it was introduced 14 years ago amid opposition from Catholics, the faith of at least 80 percent of Filipinos.

“Logic and reason won,” said Carlos Celdran, an activist who was jailed for a day after staging a protest at a 2010 meeting of bishops in the city’s cathedral. “It shows that the Philippines is moving into the 21st century and is progressing mentally. It has broken the shackles of the Catholic Church, which no longer wields the same power it had in the past.”

Protesting Priests

In August, more than 9,000 nuns, priests and churchgoers dressed in red held rallies in Manila in an attempt to derail the legislation. The protesters described themselves as pro-life and distributed pamphlets that also denounced divorce and same- sex marriage in addition to the bill.

“Whether or not an individual should live in this world should not be placed in the hands of his fellow men,” boxing champ Pacquiao said during a Congressional debate Dec. 12. “Only God has power over this.”

Imelda Marcos, a Congresswoman and the widow of the late dictator Ferdinand Marcos, said during the same debate that “any law against natural law, the fundamental law of God, is against God.”

One in five women of reproductive age in the Philippines has an unmet family planning need, the UN Population Fund says, leading to unintended pregnancies. The population is growing 1.7 percent a year, compared with 0.9 percent in the Asia-Pacific region, according to a 2011 UN Population Fund report.

The bill “is unfortunate and tragic,” Manila Archbishop Luis Antonio Tagle said after last week’s second reading. “We do not take it as a defeat of truth, for truth shall prevail, especially the truth about human life, marriage and the family.”

Sin Tax

While the church rallied opponents of the reproductive health bill, some of the nation’s wealthiest businessmen were assailing Aquino’s efforts to pass the sin tax, which will raise levies on wine and spirits and calls for twice-yearly tax increases on cigarettes.

San Miguel Corp. (SMC), which controls 90 percent of the nation’s beer market, Asia Brewery Inc. and the Philippine Tobacco Institute ran separate advertisements saying the law will hurt sales and put jobs at risk. Aquino’s uncle, Eduardo Cojuangco, is chairman of San Miguel, while Asia Brewery, Philip Morris Philippines Manufacturing Inc. and Fortune Tobacco Corp. are controlled by billionaire Lucio Tan.

Seven of the 10 leading causes of death in the Philippines, where 28 percent of people aged 15 and older smoke, are diseases related to tobacco consumption, according to data from the Department of Health.

‘Powerful’ Tool

“Higher tobacco taxes will save lives,” the World Health Organization said today by e-mail. “Tax increases that raise the price of tobacco products are the most powerful policy tool to reduce tobacco use and the single most effective intervention.”

The measure may reduce the number of smokers by 170,000 a year, or to 15.6 million by the end of Aquino’s term in 2016, the UN group said. The bill will index tobacco and liquor tax rates by 4 percent yearly to discourage their use, Finance Secretary Cesar Purisima said.

“It’s the best piece of legislation that this administration has passed,” said Modesto Llamas, president of the Philippine Medical Association, which represents 68,000 doctors. Doctors are more divided over the reproductive health bill, “such as on the issue of when does life begin,” he said.

Debt Rating

While the WHO said the sin tax is “primarily a health measure,” it also will provide an important boost to the country’s finances, said Henares, the tax chief.

“The credit rating agencies want to see that we are willing to do what needs to be done to put our fiscal house in order,” she said in an interview today, adding that the sin tax law languished in Congress for more than a decade. “It’s convincing them that we are willing to make hard decisions and can take hard action and implement it.”

Moody’s Investors Service, Fitch Ratings and Standard & Poor’s rate the Philippines a step below investment grade with a stable outlook. A higher rating may help bolster Aquino’s plan to attract $16 billion of investments in roads and airports to spur economic growth to as fast as 7 percent in 2013.

The president’s performance rating after two years in office remained steady at 78 percent last month, according to a poll of 1,200 adults by Pulse Asia Inc. on Nov. 23 to 29.

“Nowadays, no politician would want to be identified as Aquino’s enemy,” Casiple, the political analyst, said. “In next year’s national and local elections, a candidate’s endorsement by the president will be a decisive factor.”

To contact the reporters on this story: Norman P. Aquino in Manila at [e-mail]; Joel Guinto in Manila at [e-mail]
To contact the editor responsible for this story: Lars Klemming at [e-mail]

©2012 BLOOMBERG L.P.

http://www.bloomberg.com/news/2012-12-19/aquino-trumps-church-big-tobacco-with-twin-laws-southeast-asia.html [with comments]


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The Taboo of Menstruation


Sroop Sunar

By ROSE GEORGE
Published: December 28, 2012

Bettiah, India

KHUSHI knew it was cancer. Ankita thought she was injured. None of the girls knew why they were suddenly bleeding, why their stomachs were “paining,” as Indian English has it. They cried and were terrified and then they asked their mothers. And their mothers said, you are normal. You are menstruating. You are a woman now.

But that is not all. The girls, whose names I’ve changed here for the sake of their privacy, were also told: when you menstruate, don’t cook food because you will pollute it. Don’t touch idols because you will defile them. Don’t handle pickles because they will go rotten with your touch.

Pickles, I asked Ankita? Yes, madam, she told me, in her schoolyard in rural Uttar Pradesh. My mother says it is so. Her mother believed it, and her mother before her. It must be true.

I read of another girl who said that her nail polish had spoiled because she had applied it during her period. She saw nothing weird about this.

I met Ankita and her peers in November, while accompanying a sanitation and hygiene carnival, the Great Wash Yatra [ http://www.nirmalbharatyatra.org/ ], which has traveled a thousand miles across rural India. The aim of the Yatra, organized by a nonprofit called WASH United, is to spread the right messages about health and hygiene — do not defecate in the open, wash your hands with soap after the toilet and before eating — using singing, dancing, games and support from cricket players and Bollywood stars. The tactic works: all of its stalls have queues of men and boys waiting to play. All except one: a curtained tent, where only women are allowed.

This is the Menstrual Hygiene Management Lab, where girls and women can come to learn how to safely make and maintain cloth sanitary napkins (use clean cloth; dry it in the sun; iron it to remove moisture) as well as for something even more revolutionary: to talk frankly about periods.

The taboo of menstruation in India causes real harm. Women in some tribes are forced to live in a cowshed [ http://www.wateraid.org/documents/plugin_documents/menstrual_hygiene_in_south_asia_1.pdf ] throughout their periods. There are health issues, like infections caused by using dirty rags, and horror stories, like that of one girl who was too embarrassed to ask her mother for a clean cloth, and used one she found without knowing it had lizard eggs in it. According to one of the Yatra outreach workers, the subsequent infection meant her uterus had to be removed when she was 13. She would be forever tainted as a barren woman, so that whoever saw her first in the morning had to take a bath to wash her stain away.

But beyond superstition and discrimination, many Indian women face the straightforward lack of clean, safe lavatory facilities. Back in my high school in England, we may have been embarrassed by our periods, as most girls are, but we had clean bathroom stalls in which to change our sanitary pads in privacy, and trash bins in which to throw them.

Many students in India, where around 650 million people still lack toilets, can’t say the same. Most schools I visited had filthy latrines, used only because there was no alternative. Some had none at all. Students and teachers made do with fields and back alleys.

Concentrating on lessons when you are desperate for the bathroom is hard on anyone. It’s nearly impossible for a girl who is menstruating and has nowhere to change or dispose of her pad. Girls grow tired of dealing with it. Often their families encourage them to stay home from school and get married. In one survey, 23 percent of Indian school-age girls dropped out of school when they reached puberty.

“Girls suffer if they aren’t empowered to manage their menstrual cycle without pain and shame each month,” said Chris Williams, the executive director of the Water Supply and Sanitation Collaborative Council, which runs the Menstrual Hygiene Management Lab. “Their health, schooling and dignity are in the balance.” And the world suffers, too: educated women are healthier, have smaller families, often earn more and have a positive impact on development.

It can take years, even generations, to change a taboo. But anecdotally, outreach workers note that the only girls who don’t believe the superstitions about menstruation are those with educated mothers. So the best way to change the minds of future women is to keep girls in school today, and basic lavatory facilities are one of the easiest ways to do that.

Back in Ankita’s schoolyard, something revolutionary was happening. Although many male teachers in rural India are terrified that broaching the subject of menstruation will be considered inappropriate or worse, one of Ankita’s teachers was different. After attending a Yatra outreach session, he used 200 rupees (less than $4) of his own money to turn a disused latrine into a simple incinerator, which girls could use to burn their dirty cloths.

It isn’t perfect: girls still face the embarrassment of going to the incinerator with everyone knowing why. But this rudimentary construction, with its vent made from a discarded well-water pump, could have huge consequences. Not only could it bring educational salvation to Ankita and her classmates, but a better future for generations to come.

Rose George [ http://rosegeorge.com/site/ ] is the author of “The Big Necessity: The Unmentionable World of Human Waste and Why It Matters [ http://www.amazon.com/The-Big-Necessity-Unmentionable-Matters/dp/B003UYV1U6 ].”

© 2012 The New York Times Company

http://www.nytimes.com/2012/12/29/opinion/the-taboo-of-menstruation.html


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Childhood, Uncensored


Lauren Myracle, with her children. Asked why she writes books about teenagers, she said, "Because I haven't yet grown up."
Benjamin Rasmussen for The New York Times


Lauren Myracle, outside her home in Fort Collins, Colo.
Benjamin Rasmussen for The New York Times


Amulet Books

By CATHERINE SAINT LOUIS
Published: December 28, 2012

LAUREN MYRACLE has been called Satan, a pedophile, and a corrupter of youth, yet her series of books about a trio of Atlanta teenagers, written entirely in text messages, has sold a total of 1.5 million copies. She has been hailed as this generation’s Judy Blume for her candor, but outraged parents have lobbied to ban her books, which tackle topics like erections, that awkward first bra purchase, and clueless flirting that leads one sophomore to have a hot-tub encounter with a teacher. (Spoiler: her BFFs rescue her in the nick of time.)

With 17 tween and teen novels under her belt, Ms. Myracle, 43, a newly divorced mother of three, ruffles feathers because she unflinchingly addresses the pitfalls of adolescence. Many people would prefer that she not write about teenagers dancing topless at a boozy frat party, or smoking marijuana to impress a friend with benefits. While she understands their impulse to protect children, she feels it is more dangerous to keep knowledge from them.

“Give your kid some credit for being smart — just because they read about something doesn’t mean they will do it,” she said. “Fiction is a safe place to explore.”

Last year, Ms. Myracle’s so-called Internet girls series — consisting of the titles ”ttyl,” “ttfn,” and “l8r, g8r” (ask a young person to decipher the texting language) — topped the list of challenged and banned books nationwide, according to the American Library Association’s Office for Intellectual Freedom. (Angela Maycock, its assistant director, estimated that only 20 to 25 percent of challenges to books on school or public library shelves are reported.) Earning such a ranking requires a groundswell of people going to their libraries and declaring, “This is trash,” Ms. Maycock explained.

When her books were first banned in 2007, Ms. Myracle apologized to Susan Van Metre, her editor at Abrams Books. “She was shook up,” Ms. Van Metre recalled. But the author has become accustomed to controversy, Ms. Van Metre said. “She’s grown to be proud of it for what it represents in terms of being honest with kids, and bearing the brunt of parental fear.”

These days, Ms. Myracle does seem more comfortable playing the role of lightning rod. When she provides a visitor directions to her Craftsman bungalow in Fort Collins, Colo., she said, “Look for the one that brings the neighborhood down!”

If she is Satan, then this devil has been cast against type. She is a sweet-toothed baker, a hugger with hints of a Southern twang, and a lively chatterbox whose house has sock-puppet portraits on the walls.

Ms. Myracle, dressed in jeans and a T-shirt that reveals an around-the-bicep vine tattoo, has made her home the go-to gathering place for her children — Al, 14, Jamie, 11, and Mirabelle, 7 — and their friends after school. (A ready supply of Dr Pepper and brownies certainly helps.)

“I’ve always wanted to be the house that all the kids come to,” she said. “So far it’s working.”

Why?

“Because then I know,” she replied.

On the parenting continuum, Ms. Myracle hits a midpoint between laid back and nosy. She wants to know what her kids are up to (in a they’d-better-not-be-sniffing-glue way). But she also wants to be the first to know their latest crush, if they’ve set up a Glassboard (a private social network), and how they are coping after she and their father divorced in June after 17 years.

It’s been a hard but fruitful year for Ms. Myracle. Her own soul-searching has deepened her empathy for the young people she writes about. “Figuring out who I am again — it’s a parallel to adolescence,” she said.

Of late, she has ventured into darker terrain in her books for teenagers. In 2011, “Shine” — about a horrific hate crime with a gay victim and impoverished teenagers, some into meth — was nominated for a National Book Award [ http://topics.nytimes.com/top/reference/timestopics/subjects/n/national_book_awards/index.html ], then not. It emerged that “Shine” was wrongly nominated because the judges had confused it with another single-word title. She was asked to drop out, a crushing blow.

She has just handed in a 377-page draft of a novel that promises to cement her reputation for straight talk among teenage fans — and her critics, given that the book is about a newly graduated 18-year-old losing her virginity.

Her aim, she said, is to write about sex without a “soft fade” — as in cutting from “he leaned in for a kiss” to “they lay in bed, naked, smiling.” She wants to fill in the blanks, because kids are curious about the mechanics, and deciding when first to have sex has inherent drama.

“Sometimes I worry I’m writing ‘Fifty Shades of Grey’ for teenagers, but I’m not,” Ms. Myracle, dressed in fuchsia jeans with rose-colored booties, said over lunch. “It is sexually explicit. It’s sexy.”

Over the years, so many upset parents have e-mailed Ms. Myracle that she set up a special folder for them.

After reading “The Fashion Disaster That Changed My Life,” one mother of a 12-year-old girl wrote to say she disliked how giggling seventh graders dared one another to scream “honey-roasted penis!” at a sleepover party as a prank on the host mother, who thought they were saying “peanuts.”

“Why can’t kids be kids and not throw this kind of stuff at them?” wrote the mother, who also fretted about the offhanded mention of a “ménage à trois.”

Ms. Myracle, who says she often answers vitriolic letters because she’s a “good Southern girl,” wrote back, “Kids *do* talk about sex in the 7th grade. Sometimes, seeing this reflected in a book (that overall has a very moral message) can give them a safe place to process it.”

Ms. Myracle, perhaps not surprisingly, doesn’t blush when discussing potentially cringe-worthy topics with her children. She and Jamie had a good laugh about the fact that when they first watched “Gangnam Style,” they thought the rapper Psy was saying “Condom Store.”

“Lauren’s life is very much threaded through her children’s lives,” said Ms. Myracle’s sister, the novelist Susan Rebecca White, adding, “It’s very different than the parents in a Charlie Brown novel where the adults are outside of the world the kids live in.”

Thursday nights, Ms. Myracle and her sons have a standing date with Chelsea the Terrible, their name for the personal trainer who makes them lunge and lift. Trash talking ensues. Al complains the workout isn’t hard enough. Ms. Myracle, who once held a plank pose for 10 minutes to beat another gym member, doesn’t let them win.

And unlike plenty of boys on the edge of facial hair, her sons tell her their dirt, unfiltered. One afternoon after Ms. Myracle picked up Jamie at school, he recounted how a seventh grader was smoking pot on school grounds and offering it around. He was upset and shocked. Ms. Myracle didn’t pass judgment or ask him if he had been involved. “You know you can choose your friends, and you can always say, ‘No,’ “ she said.

He nodded, comforted. She explained later that she often role-plays difficult situations with her children so they know what to say in the moment.

For instance, if someone is being bullied, she’s told them, “You have to be the one to say ‘This is not cool.’ “ Or if someone makes a joke about rape, she tells them it’s fine to say, “I don’t think that’s funny.” Or if an adult ever says, “Don’t tell your mother,” Ms. Myracle advises, “You come straight and tell me, because no adult should ever say that.”

Ms. Myracle has used some of her own teenage blunders as fodder for the books — she says that she was the girl who ended up in a hot tub with a teacher before “I realized I was in trouble.”

Her mother, Ruth White, said that when Lauren was younger — part of a blended family with six children in Atlanta — she kept journals, read whatever she wanted, and had a habit of buttonholing adults. “She would say, ‘Tell me what it was like when you were in the third grade,’ “ Mrs. White recalled. Ms. Myracle gets her name from her father, Don Myracle, who still lives in her birthplace, Brevard, N.C., but he pronounces it MY-racle, while Lauren pronounces it “miracle.”

At her private Christian high school, she was a friend to loners, more interested in hanging out with motorcycle riders than cheerleaders, got top grades and had a posse of girlfriends nicknamed “the Beer Bros.”

Early in her career, she said, someone asked her at a book reading why she writes about teenagers. She replied, “Because I haven’t yet grown up.”

© 2012 The New York Times Company

http://www.nytimes.com/2012/12/30/fashion/lauren-myracle-calling-it-as-she-sees-it.html [ http://www.nytimes.com/2012/12/30/fashion/lauren-myracle-calling-it-as-she-sees-it.html?pagewanted=all ] [with comments]


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