Saturday, 21 July 2012

GlaxoSmithKline agrees $3 billion fraud payout 05 July 2012

IT'S a hefty pill to swallow. GlaxoSmithKline has agreed to pay $3 billion for introducing "misbranded" drugs and failing to report safety data, following a criminal investigation by the US Department of Justice. The settlement is the largest for healthcare fraud in US history.

"This historic action is a clear warning to any company that chooses to break the law," said James Cole, the US Deputy Attorney General, in a statement.

The charges related mainly to three drugs. The investigators found that between 1998 and 2003, GSK unlawfully promoted an antidepressant, trade name Paxil, for treating depression in people under 18, despite no approval for this from the US Food and Drug Administration.

Likewise, from 1999 to 2003, GSK promoted Wellbutrin, a drug approved at that time only for major depressive disorder, for a host of other conditions, including sexual dysfunction and addiction to drugs.

Finally, the investigation found that between 2001 and 2007, GSK failed to send the FDA safety data which revealed that the diabetes drug Avandia carried risks of congestive heart failure and heart attacks.

"I want to express our regret and reiterate that we have learnt from the mistakes that were made," said Andrew Witty, chief executive officer of GSK, in a statement. He added that the offences were symptomatic of conduct that is no longer tolerated. "The company reached this settlement with the government to avoid the delay, expense, inconvenience and uncertainty of protracted litigation," said Witty.

The company's annual report reveals that GSK posted an operating profit last year of more than quadruple the fine, at $12.4 billion, and turnover of $43 billion. The company is valued at $113 billion.

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It Isn't Their Money!

Thu Jul 05 09:37:08 BST 2012 by ullrich fischer

If the $3b were to come out of the pockets of the GSK execs responsible for the decisions leading to this crime, that might be a slight taste of justice, but to fine the company is to take the money out of the pockets of GSK shareholders most of whom had no say in those decisions. As it stands, this is not a proportional deterrent. Consider that Bernie Madoff is in jail for life despite having killed no one. The action described in the article may well have killed thousands due to inappropriate medication and thousands more due to the support this scandal gives to the "big pharma is a conspiracy" meme which is currently causing thousands of families around the world to refuse to vaccinate their children against deadly diseases

It Isn't Their Money!

Fri Jul 06 09:18:44 BST 2012 by sevenleafclover

So you're saying they embezzled the money to pay the 3b fine? hmmm, I don't know...

These corporate conspiracy theories are interesting, but nothing will change unless consumers take action:

Consumers must hold these shady corporations accountable through the organization of boycotts, and through the enaction of new legistation. Only then will corporations hold their execs personally responsible for their actions.

Socal media has given consumers a much greater power, it's high time consumers start using that power justly.

It Isn't Their Money!

Sat Jul 07 00:27:39 BST 2012 by Chris

'So you're saying they embezzled the money to pay the 3b fine?'

Nope, he didn't say that or even imply it at all, it might be better if you actually read, and understand, what someone has written before you comment on it.

The point being made was that the fine, being levied against the company, is to be paid out from the companies profits thereby badly affecting the shareholders dividends for a year or two, (remember the shareholders were not the ones who decided to mis-sell and mis-report these drugs)

Meanwhile the excutives who did decide to put peoples lives and health at risk to increase sales do not themselves pay the fines despite being those responsable.

Money grabbing management parasites like those here should pay compensation out of their own pockets to all those affected in this debarcle, receive heftly fines and/or prison terms and should of course be banned from working in a management position in any healthcare, medical or drug company again

It Isn't Their Money!

Tue Jul 10 04:12:55 BST 2012 by Jamie W.

I vehemently disagree with Chris and Ullrich that the shareholders are somehow innocent in all this. Of course the Glaxo exec's should face the music (or perhaps a firing squad), but anyone who holds shares should know exactly where their money is invested. They may not design the profit-making schemes but they're happy to rake in the dividends. Would it be acceptable for me to take shares in a crystal meth factory? Should I evade punishment if the cooks get busted?

It Isn't Their Money!

Tue Jul 10 03:58:52 BST 2012 by Jamie W.

"The company reached this settlement with the government to avoid the delay, expense, inconvenience and uncertainty of protracted litigation,"

The above quote says it all, really. If the swine thought they had a chance in court they would have sent in the lawyers. Their accountants would have determined that settling was the option least damaging to the shareholders' hip pockets.

There's no conspiracy here, there's no cabal of evil pharma-lords, just a system that prioritises profit-maximisation and limits personal responsibility. The Glaxo decision-makers were doing their job, and their job isn't developing and providing treatments for unwell people, it's providing ever-increasing dividends. The average large pharmaco spends around three times more money on marketing than they do on R&D, a fact which tells us exactly what their priorities are.

It seems to me that there's something profoundly wrong with a system where treatments for the unwell (or food for the hungry, or heating for the cold, or shelter for the homeless) are provided or withheld on the basis of profitability.

I agree with sevenleafclover (do they grow near Pripyat?) that action is desperately needed, but I suspect boycotts and legislatory changes are nothing more than inconveniences, like fleas on a rabid dog.

Perhaps it's time we stopped referring to human beings as consumers. Perhaps we can use the power of the web to do more than complain. Perhaps it's time we take back the world.

It Isn't Their Money!

Mon Jul 09 19:21:57 BST 2012 by James

I am now curious where the 3BN is going? How much did it cost to get the 3BN fine so how much is my government actually making? Additionally I thought we had a law that corporate execs could be charged with this as a crime, Knowingly choosing proifits over the safety of people.

It Isn't Their Money!

Tue Jul 10 04:25:41 BST 2012 by Jamie W.

"...and thousands more due to the support this scandal gives to the "big pharma is a conspiracy" meme which is currently causing thousands of families around the world to refuse to vaccinate their children against deadly diseases"

Ullrich, you've got to be kidding. I absolutely agree that scientifically-illiterate idiots refusing to vaccinate their kids is a huge problem, but you can't seriously be suggesting that we should let stuff like this slide in order to preserve the respectable face of the pharmaceutical industry. Perhaps I've misread your intentions?

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