Glaxo Settles Cases With U.S. for $3 Billion

The settlement was the largest yet in a wave of cases brought against pharmaceutical companies for illegal marketing of drugs.

Comments: 41

  1. I am a physician. To a drug company, this is a drop in the bucket and I see no reason why they will change their ways. Prescription drug costs are at record levels, but hey, that's capitalism so they've won. The patient's have lost, but that's a small price to pay.

  2. Where does the money from such settlements go?

  3. I wonder how the Ayn Rand people respond when they see something like this. Do they dismiss it as overzealous prosecution? Honest mistake in thinking it was OK to bribe doctors? Just an unfortunate but necessary side effect of clearing the way for the John Galt's of the world?

  4. Since the company's stock price went UP with the announcement of the settlement, it's very clear the amount settled for is not nearly large enough.

    The only way corporations are going to curb illegal activity is if the fines are sufficiently painful that their stock drops sharply in value.

    An amount equal to twice the gross sales figure of the product in question should do.

    At that point, the stockholders will will get involved and it is hoped will force the company into doing fewer illegal things that trigger massive fines.

    What's the point of a 3 billion dollar settlement when the company made 10 billion dollars is sales of the product in question? At that rate, I'd be just as inclined to lie cheat and steal as Glaxo has been.

  5. Just the cost of doing business.

    Until the people who make the actual decisions in the drug and financial industries are criminally prosecuted and, if found guilty, sentenced to hard jail time, absolutely nothing will change.

  6. "Company whistleblowers and federal prosecutors said the company had paid doctors and manipulated medical research to promote the drug." It's about time! I knew someone a couple of years ago who did medical transcriptions of drug research results. She saw what information was not being included. The results presented were lies to allow the drugs to go to market. She refused to take prescriptions because of this.

    I completed my worthless college degree in 2008. One of my last classes was on propaganda and rhetoric. I wrote a "marketing" paper after doing a lot of research into ethanol. I glorified ethanol and made it as American as apple pie - perhaps it is but it takes a lot of energy to produce it and it's killing our farming land that could be used to generate food. I learned that anything can be skewed by omitting a few facts. In Glaxo's case, those omissions lead to deaths.

    I'm glad they were fined and hope this continues. Unfortunately, the pharmaceuticals hold one of the biggest lobbys in Washington, so this may be just a token to calm us temporarily.

  7. The only way to stop these shenanigans is to make the CEOs personnally accountable for the actions of the companies they lead. No one knows how many patients have been harmed by these corrupt and illegal pactices.

    With CEO pay, bonuses, perks, etc. at all time highs, we need to have the threat of personal felony convictions and prison time for the CEOs whose companies are found to continue these practices.

  8. Avandia is only the latest product misrepresented by the pharmaceutical industry. Their pushers -some more accurately described as shills rather than physicians- are complicit since they get paid regardless of the outcome. While there are 'miracle drugs' the vast majority of the medications earning money today are merely clones of one another. We won't even mention the obscene profit made by corporate snake oil sales.

  9. A friend that was having some fairly serious medical issues, particularly with a post-surgical infection, was prescribed a potent anti-biotic made by GSK. He was told he would probably need to have it filled at the hospital pharmacy since most corner drugs stores did not stock the drug.

    He was given 60 tablets which would be a 30 day supply. The total was $4200.00.

    His insurance company refused to cover as the drug was not on their formulary. It is considered an orphan drug that is not frequently prescribed but required the same R&D as a drug companies block busters. The patent on the drug prevents a generic equivalent.

    I guess we will all be helping pay this $3B settlement – one $70 pill at a time.

  10. Simply another example of Americans being fleeced by mega corporations supported by Republicans intent on eliminating most government regulation. This should be Exhibit A as to what will happen with increasing frequency if these politicians succeed in their crazed mantra of getting government off our backs and out of our lives. Instead, these same Republicans, and you the voters who elect them, are training their sights on the little guy by attempting cutbacks and elimination of health care services and coverage to those who can least afford to lose those benefits. Amazing to me how many of the very people who stand to lose the most regularly line up to vote for the politicians who would champion that loss.

  11. All we need to understand how far through the looking glass we truly are is to realize how Glaxo's stock price ROSE on news of a $3 billion settlement, perhaps, in part, because it had set aside $3.4 billion.

    It's Big Pharma's version of the "Pinto Defense."

    Pax vobiscum...

  12. What makes these CEO's any different than pushers on the street? They've got lobbyists and lots more money. Otherwise, they both pretty much don't care what happens to their clients.

  13. Well, put Glaxo in jail. It's a person, right?

  14. Not again? Please let's get rid of government and all licensing, patents and other restrictions and let the public beware (or be damned).

    Woops. I was reading the script of the Republican Party as developed by the Tea partieres.

  15. Herbs and roots work better anyway. Hey, life expectancy in the days before medicine was at least 25 years.

  16. If GSK gave money to doctors, the settlement should include naming the doctors. The names could then be forwarded to the state ethics boards.

  17. I'm starting to understand this 99% versus the 1% thing real well.

  18. British agreed to pay $3 billion to .... them US Government. What about the people who were victimized by excessive costs? Maybe some of them might get a tax deduction... if they itemize.

  19. Andrew Witty's public announcement as CEO of Glaxo,the second biggest pharmacutical conglomerate after Pfizer,is reflective of his proffessional integerity as well as ground realities of gigantic business field with annual turn-over crossing over one Trillion dollars as depicted in the recent book," Sex,lies + pharmaceuticals" by Barbra Mintze and Ray Moyninan.Unlike the C.E.O of Firestone who killed century old brand, by pushing the market problems under the rug,Witty has shown clarity of vision to agree to pay a staggering amount of $3 billions to settle the case and thereby giving a boost to his company's shares.On the otherside its commendable achievement of board of Ethics.However I endorse the views of probing the cases of the doctors who took the bribes to promote GSK's drug.

  20. Meanwhile, we are REGULARLY experiencing nation-wide shortages of INEXPENSIVE, ROUTINE drugs like fentanyl, propofol, and succinylcholine (I'm an anesthesiologist)--drugs whose profit margins are very small, which, ultimately, is the reason why we are short on them. It's of no major concern to BIG PHARMA if those drugs cannot be produced in sufficient quantity, as it won't affect their profitability.

    I'm aware of NO SHORTAGE of drugs still covered by patent. Hmmm, one can do the math on that one.

    We are aspiring to become a third world country . . . Corporate America is leading us in that direction.

  21. Total restitution of all profits made from the drug must be enforced! Every time they are not deprived of all profits (and preferably additional fines of x2 or more of profits) then they will continue to follow the same path. Pharmaceutical companies don't care about patients, they care about money. Hit them where they can feel it and remember!

  22. What's so complicated? It's only money and the fine is just one of the costs of doing business - just a bit of overhead. How about legislation(if it doesn't already exist)enabling significant jail sentences for the upper level officers. Only that will get their attention. And let the jail sentences be both proportional to the damage and hardship caused and additional time to deter future such activities. Not complicated at all - in a truly civilized society that restricts the narrow self interests of greedy corporate leaders to do harm this is what is necessary. It's the nature of the beast. What's so complicated?

  23. Greed and stupidity rule the day. Naturally, no federal oversight is ever needed, since companies will clearly be ethical, responsible and always put people before profit. Direct to consumer advertising anyone? That went especially well with Vioxx. Also, always a good idea to have the drug companies pay for the FDA drug review process. What conflict of interest?

  24. American corporate business as being practiced at this time is corrupt and will remian that way until we get money out of polticis. There are very few companies that are self policing since large scale failure of their products would be hard to suppress. An example is Boeing, how many planes can you crash in one year before your product is quesitoned. The problem with too many businesses is they are not nor is the quality of their product tranparent.

  25. As employees, would any of you care about losing piles of company cash if it did not in any way affect you personally? I know I would not care too much if my employer lost money as a result of my unethical actions if there were no personal or professional consequences to me. These fines only hurt shareholders. Unless the people making the unethical and outright criminal decisions are held accountable through jail time and a loss of their career, they will not stop. Why not take an unethical risk that increases sales if taking that risk can result in a nice bonus or promotion, but the downside is negligible.

  26. "Company whistle-blowers and federal prosecutors said the company had paid doctors and manipulated medical research to promote the drug."

    GSK is a British company. Do they also pay off physicians and manipulate medical data in the UK, Sweden, Norway, the Netherlands, Germany, Australia, Canada, New Zealand and so on and so on?

    Why is it always Medicare and Medicaid that are ripped off? Does Big Pharma also rip off the Swedish national healthcare system? Why are not U.S. private health insurers part of this lawsuit? Are they not also being defrauded?

    Here in Texas a couple of years ago there was a legal case against a Nigerian pharmacist. He was convicted of defrauding Medicare and Medicaid by using stolen and false membership numbers. In his defense, he said that he had only been in the U.S. for a few short years and that he "tried to live the American dream."

    Sadly, that is truly the American dream - to defraud the federal government of every dime possible.

  27. Question: Why are the doctors accepting money to prescribe a drug that they question is safe? Drug companies sell-- but aren't the truly unethical ones the docotrs who happily accept the cash in exchange for patient safety and Medicare money?

  28. When my oldest sister was placed on hospice because they thought she was going to die of the flu last spring, they took her off all her medications (which had cost almost $300/month) and now she seems to be more healthy than ever. They haven't restarted the drugs. She is going to be 90 years old this month. She appears to be more healthy than even the help in the nursing home where she resides.

  29. Dear "Enforcement" Agencies: (ok, everybody out here is rolling on the floor at "enforcement")

    We, us, the People; do not care a rat's patoot about the money - WE WANT HEADS TO ROLL- we want the executives who perpetrated this horrific crime- RUINED - in chains; in jail, every penny they stole stripped from them.

    That would be called "Justice". Stealing a couple billion from the company stockholders just doesn't cut it, justice-wise.

  30. Eli Lilly Zyprexa Olanzapine issues linger.
    PTSD treatment for Veterans found ineffective.

    The use of powerful antipsychotic drugs has increased in children as young as three years old. Weight gain, increases in triglyceride levels and associated risks for diabetes and cardiovascular disease. The average weight gain (adults) over the 12 week study period was the highest for Zyprexa—17 pounds. You’d be hard pressed to gain that kind of weight sport-eating your way through the holidays.One in 145 adults died in clinical trials of those taking the antipsychotic drug Zyprexa.
    This was Lilly's # 1 product over $ 4 billion per year sales,moreover Lilly also make billions on drugs that treat the diabetes often that has been caused by the zyprexa!
    --- Daniel Haszard Zyprexa victim activist and patient.
    FMI zyprexa-victims(dot)com

  31. The corruption and criminality of major corporations is so pervasive, so widespread, that an ordinary citizen can only shake her/his head in disbelief. Thousands of people are in prison for drug habits, not much different than the habits created by pharmaceutical companies and the medical establishment by prescribing addictive drugs. And not one member of a corporation is in prison for illegal manipulation of drugs that have lethal effects on huge populations. What is going on here? Talk about inequality. Notice in this story that the company in question had three billion dollars on hand to pay the fine. Seems it hardly affected their business. Fines like these have become operating expenses for huge corporations. And many question the motives of the Occupy Now protesters? We all need to join them.

  32. For Glaxo, $3B is just part of the cost of doing business.

    Drug companies are one factor driving health care costs up in this country. Other countries, which have universal health care, negotiate drug prices. We pay premium prices that subsidize medication for the rest of the world and are effectively subsidies for these international corporations. And they don't need subsidies from us-- their profits are obscene.

    Americans use more prescription drugs than people in any other nation on earth. America is one of only two countries that allow direct to consumer prescription drug advertising. (The other is New Zealand.) This began in the 1980's, at first only in print because the FDA required full disclosure of possible side effects and contraindications. Late in the 1980's, regulations were loosened so that ads could refer consumers to other sources for complete information, which opened the door to TV advertising. Since then we've been bombarded with drug ad campaigns, which coordinate TV, print, phone numbers and websites.

    The FDA has less than 500 people who screen these campaigns after the fact. Ads are on the air before they've been vetted for unethical persuasive practices, which are endemic: satisfied customer enjoys life in visuals behind fast, flat delivery of only most common possible horrifying side effects, contraindications, and cautions.

    Roughly 1/3 of the cost of prescription drugs is marketing, far more than it was prior to the 1980's. Big media profits mightily from drug companies. Two big lobbies will fight tooth and nail to continue these ads. It's doubtful that the ads have improved our health care and likely that they has harmed it. Drug companies oppose valid studies to establish most effective treatments so they can continue to market "new and improved" which may well be "new and dangerous."

    Our health care "system" rips us off with high cost meds that may well put us at serious risk. Avandia is just one more example.

  33. For just this contingency Glaxo probably set aside $3-5/B before Avandia (Rosiglitazone), a thiazolidinedione agent, even went to market.

    Every thinking physician weighs benefit/risk before prescribing a specific medication for a patient who has a specific medical problem.

    Only a naïf would be fool enough not to recognize that some physicians and some pharmaceutical companies seek to maximize FINANCIAL benefit/risk ratios as well.

    Rezulin (Troglitazone), manufactured by Parke-Davis in the late 1990s, was withdrawn from the market due to an increased incidence of drug-induced hepatitis.

    Actos (Pioglitazone), manufactured by Takeda, has subsequently been found to be associated with bladder tumors and has been withdrawn in some countries.

    I suppose we may just have to wait and see if Takeda, responding to the Avandia debacle by providing excellent black box warnings with Actos, has provided for the same financial contingencies.

    If so, what does that say about the contemporary pharmaceutical enterprise?

    I am reminded of President Dwight D. Eisenhower’s expression ‘military-industrial complex’ from his Farewell Address to the Nation on January 17, 1961: “We must guard against the acquisition of unwarranted influence, whether sought or unsought, by the military-industrial complex. The potential for the disastrous rise of misplaced power exists and will persist.”

    Wise, prescient and predictive words from a wise man who, if running for office today, would be booed out of his Republican Party and barely welcome in the Democratic Party.

    What does this have to do with Avandia?

    Everything!

    Doesn’t it?

    Mark Gary Blumenthal, MD, MPH
    Knoxville, TN

  34. So they did illegal things that endangered lots and lots of people's lives and well being, and they did things to rip off lots and lots of money...

    And they're fined $3 billion dollars? For a company that is worth over 100 Billion dolars and earns $5 Billion dollars a year, they got slapped on the wrist.

    To teach them a lesson, they should have paid a fine that is 10x that! A penalty like that would make them--and other pharmaceutical companies--think twice about doing stuff like that again. The fine should be a significant portion of their net worth and a multiple of their annual earnings.

  35. The fine is little more than a reasonable and business-friendly fee the government charges, that licenses Glaxo to rip us off.

  36. simple solutuions:
    (A) no drug advertising except in professional and clinical literature.
    (B) no drug salespeople allowed to speak to any physician in her/his office or within 10 miles of same.
    (C) no tax deduction for advertising, promotions and efforts to
    promote drugs
    (D) no cash or in kind payments from any drug company or afiliate to any medical practitioner, medical center, hospital, medical school.
    (E) all funds for continuing education should go to an independent organization that will produce independent articles, videos, etc. that can only be accessed from a medical school.
    (F) all medical practitioners receiving any payments in cash or kind automatically shall have their license to practice suspended until the conclusion of any investigation an hearing. any medical practitioner found guilty shall be required to work in non-profit organizations that provide care to the working poor, Medicaid enrollees and Medicare beneficiaries. Payment for such services shall be made at the rate of 150% of the local poverty level.
    (G) any settlement of an allegation of wrong doing by any drug company or affiliate shall require the CEO, internal legal counsel and all employees making over $250,000 to resign without any benefits, retirement or stock (or options).
    (H) any drug improperly marketed shall be withdrawn from the market for 180 days. In the alternative it shall be dispensed at no expense or cost to the patient, the patient's family or any insurer.
    (I) stock dividends shall be paid to the federal government's FDA.
    (J) a class action listing any person or entity which paid for the drug in the prior three years shall be entitled to full reimbursement plus 10%.

    Treat them as Rockefeller wanted to treat his favorites (i.e. poor, blacks, Hispanics) with his Draconian racist drug laws. They did not work becuase the individuals had little to lose and much to gain. Drug companies and their minions do have something to lose.

  37. I hope the past, current and future victims & their families get all the money.

    Interesting how corporations can buy their way out of criminal prosecution of its executives? With 7,225,800 adults under correctional supervision (probation, parole, jail, or prison) in 2009 — about 3.1% of adults in the U.S. resident population, maybe we should afford them the standard as we do corporations - Image what we could do to reduce the deficit starting at $1,000 to "get out of Jail".

  38. Remember the anguished cries of the Oligarchy wailing about "plea bargaining" by the uneducated, unwashed people of this great country.
    Put them in jail where they belong-this Wonderfu Land of Ours isn't going to be safe to live in anymore!
    To read this article within the awareness of my foregoing statement puts me in anguish for what is to come.
    How could those that were supposed to not allow this, you know, the law, the constitution, and all of that stuff let this become a routine outcome for the worst of crimes by the most educated, most clean of us?

  39. It is my opinion that GSK DO NOT CARE ABOUT ANYTHING OTHER THAN THEIR BANK BALANCE. Nothing they can do will surprise me anymore. How long will GSK get away with making settlements? I want to see them in Court - A criminal prosecution. They SHOULD NOT be allowed to settle out of court. They disgust me to the core of my soul. I lost two years of my life withdrawing from PAXIL - a drug that they claim is non addictive and can be stopped safely in the majority of people within 2 weeks! Ask the millions of people online who are trying to come off these drugs if that is in fact the case and you will get a resounding NO! I myself was told it was my original symptoms coming back and should go back on them! Thank the Lord I had the strength to continue through the withdrawal hell. After 2 years of being sick,dizzy,tinitus,shocks through my brain, general flu like symptoms and feeling at an all time low I finally beat the drug. I only wish I had been told the truth about how long it would take to ever got off this drug before I started taking it. In so many ways I have lost years to GSK and their wonder drugs. I am delighted they have had to pay billions to settle this case (I wish it was 100Billion) but I want to see people lose their jobs and made accountable for in my opinion their diabolical actions. I hope that by highlighting their behaviour in this particular instance the people with the power start questioning GSK and digging a bit deeper in to the archives. I will never forgive that company for what they have put me personally through. The nightmare of Paxil withdrawal! Shame on you GSK.

  40. Should have been barred from ever doing business again. These rober barons feed of peoples misery. Heaalth care for huge profiteers is immoral. The health insurance companies only care about making huge profits off peoples sickness. Absolutely disgusting.

  41. $3 Billion is peanuts when Glaxo Smith earnings amount to some $40 billion a year. Some of the drugs that this pharmaceutical company pushed illegally will not show the effects for over some decades. When the US DOJ signs off on this settlement, who becomes the responsible party for the people who will suffer in the future. In this kind of economic terror that besiege this nation, it is utterly irresponsible for the US Government to let Glaxo Smith , a British company off the hook.