Did a misdirected e-mail between two law firms doing work for Eli Lilly and Co. lead to a front-page scoop last week in the New York Times?
That's what a flurry of blogs covering the pharmaceutical and news industries have been reporting. But it might not be as open and shut as that.
On Tuesday, Conde Nast's Portfolio.com reported that one of Lilly's outside law firms, Philadelphia-based Pepper Hamilton, had mistakenly e-mailed confidential information on settlement talks between Lilly and government prosecutors. The talks concerned a long-running government probe into the marketing of Zyprexa, Lilly's top-selling drug.
The lawyer at Pepper Hamilton apparently meant to e-mail the note to another lawyer representing Lilly, Bradford Berenson at Sidley Austin, reported Portfolio.com, citing an unnamed pharmaceutical consultant.
Instead, the Pepper Hamilton lawyer mistakenly e-mailed the "very comprehensive document" to a New York Times reporter with a similar name, Alex Berenson, who covers the pharmaceutical industry, said the Portfolio.com story.
"So when the Times' Berenson began calling around for comment, and seemed to possess remarkably detailed inside information about the negotiations, Lilly executives were certain that the source of the leak was the government," the Portfolio.com story said.
On Jan. 30, Alex Berenson wrote a story, citing anonymous sources, that Lilly might pay more than $1 billion to settle a criminal and civil investigation into the marketing of Zyprexa. The story appeared on the front page of the Times and The Indianapolis Star the next day, and was reported around the country.
Portfolio.com's story about the mistaken e-mail, with the headline "Lilly's $1 Billion E-Mailstrom," was picked up or repeated in such media outlets as the Wall Street Journal Law Blog, Drug and Device Law, Pharmalot and Above the Law.
"So how did Mr. Berenson get the scoop? It turns out that it wasn't through any tried-and-true gumshoe reporting techniques taught at J-school. He simply had the fortune of having the same last name as one of Eli Lilly's attorneys," said a blog posting Tuesday at Star Associates, an investor relations firm based in New York, citing the Portfolio.com story.
Lilly declined to comment about the story. Officials at Pepper Hamilton did not return a phone call on Wednesday.
However, the New York Times reporter said Wednesday in an interview that although he did receive a misdirected e-mail, it was only two lines long , not a "comprehensive" description of settlement talks.
"It didn't have any details in it," Alex Berenson said.
Berenson said he had known independently about the settlement talks from previous, off-the-record conversations with sources close to the negotiations. The e-mail, Benerson said, merely confirmed Lilly had been negotiating with officials at the U.S. Attorney's office in Philadelphia. That confirmation allowed him to go with the story, he said.
On Wednesday, several blogs that had run or linked to the original Portfolio.com story began back-pedaling. Pharmalot, a popular industry blog owned by the Star-Ledger of Newark, N.J., said on its Web site: "It appears that Portfolio got it wrong."
But Portfolio.com stood by its story. A spokeswoman, Perri Dorset, said Wednesday: "The e-mail document clearly confirmed the settlement talks that Alex received," she said.
Call Star reporter John Russell at (317) 444-6283.