Page 2 April 6, 2017 Drug Maker Doesn’t Have to Explain Price Hikes to Shareholders See Price Hikes, page 4 Finance Four Tips to Help Protect Your Identity this Tax Season (BPT) - Tax season is a busy time for everyone. From accountants and small business owners to families and individuals, especially as more people choose to file their taxes themselves. Unfortunately, it’s also a busy time of year for cybercriminals who use the flurry of activity to swindle sensitive personal information from unsuspecting victims. In fact, the Norton Cyber Security Insights Reports revealed that online crime has become so prolific, 36 percent of U.S. consumers believe it’s only a matter of time before a criminal steals their identity. Take for example, Melissa, a marketing manager from Chandler, Arizona, who last year received an alert from her online tax filing service that her account password had been changed. But she dismissed the notification as a mistake. “Two days later I got an alert from LifeLock about a credit card that I hadn’t opened.” Thinking this was strange, Melissa followed up with her tax filing service and found that a criminal had accessed her account, stolen enough personal information to open a credit account in her name and redirected her tax return to another account. Fortunately, Melissa was able to resolve her case but she is just one of a staggering number of individuals who’ve fallen victim to criminals lurking the web. According to research from Symantec, cybercriminals launched more than 1 million web attacks against internet users every day in 2015. While this statistic may seem shocking, there are things you can do to help protect yourself and your identity from cybercriminals. Start by applying these four simple tips to keep your personal information away from cybercriminals this tax season: 1. File Your Taxes as Early as Possible The sooner you file your taxes, the harder it will be for criminals to file taxes on your behalf for a refund, which a thief can do with only your date of birth and Social Security Number. (And don’t think this information is difficult to find, it could already be for sale on the Dark Web if you were impacted by a data breach.) If you want some extra protection this tax season, consider contacting the IRS to see if you’re eligible for an Identity Protection PIN. It’s a six-digit code that is assigned to you by the IRS to help prevent misuse of your SSN on fraudulent federal income tax returns. 2. Filing Your Taxes Online If you’re filing your taxes online, use a secure Wi-Fi connection or a Virtual Private Network (VPN). One of the best ways you can help protect yourself when e-filing is to use a secure internet connection and not a public Wi-Fi network. If you are not sure about the security of your internet connection, use a VPN - an easy-to-use technology that ensures a secure connection. 3. The IRS Only Communicates through the USPS They will never request personal and/or financial information through email, text messages or social media sites. If you receive a letter in the mail and you’re not sure if it’s legitimate, use the IRS lookup tool to find your letter: www.irs.gov/individuals/ irs-notice-or-letter-for-individual-filers 4. If You Receive a Phone Call from the IRS Ask for their name, badge number and call back number. Report the call to the U.S. Treasury Inspector General for Tax Administration (TIGTA) at 1-800-366-4484 and provide this information to confirm the authenticity of the caller’s request. If the caller isn’t willing to provide this information, hang up and report the incident to the IRS. If you believe you’ve been the victim of an IRS scam, you may also report this to the TIGTA at their website: www.treasury.gov/ tigta/contact_report_scam.shtml. Don’t delay in doing so. After all, it’s your identity and it is up to you to protect it every single day. • By Rob McCarthy Call this a case of the right hand not knowing what the left hand is doing. A federal government lawyer told one of the country’s largest pharmaceutical companies last month it can remain silent about why it raised prices on life-saving therapies. The irony here is that the people asking for that information are concerned shareholders of the biotech company Amgen whose CEO was called recently to the White House for a meeting with the President. Amgen is based in Thousand Oaks, yet it is a darling with fund managers and South Bay investors because of the company’s sustained growth and annual profits that will return $11 or $12 per share to investors this year. The company earned $6 billion in profit last year, and made $16.6 billion in sales on its 10 topselling therapies. A faith-based shareholder group that includes the Catholic healthcare system Dignity Health filed a proposal last fall asking Amgen’s management to explain to the stockholders why it raised prices on some drugs dating back to 2010. Specifically, the Mercy Investment Services group asked for details about the company’s rates of price increases and the reasoning behind them. The request included any assessment of risks to Amgen from price hikes on its 10 best-selling drugs. An attorney for the group argued to the SEC that the healthcare debate in Washington and public opinion over patient-drug costs put Amgen and its investors on shakier ground in 2017. Stockholders could be affected if the federal government caps reimbursement for prescription drugs covered through Medicare and Medicaid, attorney and former law school professor Paul Neuhauser wrote to the SEC in January. That letter was a follow-up to another one sent last fall to Amgen CEO Robert Bradway and his management team. The Mercy Investment members were worried about public outrage over pharmaceutical prices and by comments made by President Trump during his campaign. Trump said that drug makers were “getting away with murder” and vowed the federal government would negotiate lower prices on his watch. The group is largely comprised of religious groups, including the Dignity Health system that operates clinics in Inglewood and Torrance. Their attorney reminded the SEC staff that in the past they had sided with shareholders wanting drug makers to explain to them how prices were set on FDA-approved medicines. Amgen, in its own letter to the SEC, said that it already provides drug information on its website. However, the faith-based group says the drug maker is being secretive and that the information it wants is more detailed than what the company has divulged publicly. Drug pricing represents a moral issue for the religious community, Neuhauser said, noting that CEOs of major drug companies have appeared before Congress and been roundly criticized over increases to drug costs, including a 400 percent hike for EpiPen, used by children with severe food allergies. Turing Pharmaceuticals caught flak from Congress and the public after it hiked the price by 5,000 percent on an anti-parasite therapy called pyrimethamine. President Trump in January met at the White House with pharmaceutical executives, including Amgen CEO Robert Bradway. One topic of discussion reportedly was the need to make drugs cheaper for U.S. patients. The President promised U.S. corporate tax cuts from his administration and gave the CEOs a tour of the White House, but he didn’t ask for any specific commitments from the pharmaceutical executives on capping their pricing. The interfaith shareholder group is keenly aware that the President, Congress, insurers and patients are closely watching how Amgen and the industry, known as Big Pharma, respond to the palpable dissatisfaction with high drug costs. Amgen’s business plan “can be upset if there’s enough public pressure,” Neuhauser said. The company’s revenues grew by eight percent annually over a five-year period, according to Amgen figures. Amgen attorney Andrea Robinson successfully argued that drug pricing falls into ordinary business operations, which needn’t be discussed with shareholders under SEC rules. In a letter dated January 10 to the SEC’s Division of Corporation Finance, Robinson reminded the commission staff that the exemption exists so that stockholders of a publicly owned company don’t micromanage how it conducts business. That includes how it sets prices and prepares for any backlash, she wrote. “The supporting statement further requests that the Company provide ‘detailed justification for price increases.’ These mandates demonstrate that the Proposal is seeking to probe deeply into matters of a complex nature upon which stockholders, as a group, are not in a position to make an informed judgment,” Robinson wrote. SEC staff issued its legal opinion in the Amgen matter on February 10 in favor of the drug maker. Though the opinion is nonbinding, the Mercy Investments group will not pursue the issue with Amgen at this year’s shareholder meeting, the group’s attorney said. Identically worded proposals were submitted to at least eight U.S. drug makers, and SEC staff gave a thumbs down to each shareholder plan for more transparency about drug pricing. Mercy Investment members were involved in some, but not all, of the calls for more transparency from the pharmaceutical industry, Nehauser confirmed. It’s possible his client will pursue this issue next year with Amgen management, he said. Other drug makers being pushed by stockholders for more transparency about their pricing decisions include some of the largest pharmaceutical companies in the country. SEC staff in February blocked proposals filed with Biogen, Bristol-Myers, Eli Lilly, Gilead Sciences, Merck & Co., Pfizer and Vertex Pharmaceuticals, according to SEC records. The campaign by faith-based investors, many of them members of an interfaith push for corporate responsibility, doesn’t appear to be finished. The SEC staff’s decision not to recommend any enforcement action against drug makers for ignoring these shareholder requests only covers this year, so they could be back. “The first shareholder proposal on drug pricing that I’m aware of was successful in the 1990s,” Neuhauser said. “There have been successful ones since. I think the problem this year was more the way it worded than the basic notion.” Shareholders in three 2015 cases overcame a drug maker’s resistance to producing its pricing data, according to Neuhauser. In each case, the companies argued like Amgen that investors were trying to micromanage the business operations, yet SEC staff rejected the argument Neuhauser presented in January in writing. The former law school professor pointed to other SEC’s staff opinions regarding drug companies and price-setting. “This is not too intricate a matter for shareholders to understand. Note that it is the rate of increase that is being requested, not the actual prices charged. Indeed, the proposal ‘micromanages’ significantly less than the proposals that were deemed not to micromanage in Celgene Corp. (March 9, 2015), Vertex Pharmaceuticals Inc. (February 25, 2015) and Gilead Sciences, Inc. (February 23, 2015),” he wrote. Calls to Amgen representatives for comment about the pricing of its leading drug therapies went unreturned as of late last week. The company’s website did not mention the SEC lawyer’s favorable ruling. Amgen had product sales of $21.9 billion The Jewelry Source 337 Main St. El Segundo. 310-322-7110 www.jewelrysourceUSA.com ©2007 Makes your bunny snuggle
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