Drug Makers Pay Government Billions For Fraud

Some of the largest pharmaceutical companies, the household names who make many of the drugs we take, have agreed to billion dollar settlements with the U.S. Department of Justice to avoid civil and criminal litigation. The charges include fraudulent marketing practices – a big part of which has been promoting drugs for uses not approved by the U.S. Food and Drug Administration (FDA).

The charges have also included financial payouts to doctors and pharmacists to prescribe or sell their drugs, manufacturing practices that can contaminate the medicines, and using unreliable scientific data to win FDA approval.

Here are highlights of some recent large settlements:

GlaxoSmithKline – $3 billion – July 2012

GlaxoSmithKline paid a whopping $3 billion to settle civil and criminal charges for its shaky drug promotion practices and for failing to properly report safety data. The company agreed to plead guilty to mis-branding Paxil and promoting it to treat depression in children under 18, even though the FDA never approved Paxil for that age group.

GlaxoSmithKline also pled guilty to failure to disclose safety information for Avandia, its diabetes drug.

Pfizer – $2.3 billion – Sept 2009

In 2009, Pfizer pled guilty to mis-branding Bextra, a painkiller, with “the intent to defraud or mislead” and promoting the drug to treat acute pain with dosages that the FDA had already said were too dangerous. Due to safety concerns, in 2005, Pfizer eventually took Bextra off the market. The DOJ had alleged that Pfizer also conducted illegal promotion of Geodon, an antipsychotic, Zyvox, an antibiotic, and Lyrica, a drug to treat epilepsy.

Johnson & Johnson – $2.2 billion – Nov 2013

Johnson & Johnson paid $2.2 billion to settle civil and criminal charges over its drug promotion practices for Risperdal, Invega and Natrecor. It’s alleged that the company repeatedly promoted these drugs for uses not approved by the FDA and it paid kickbacks to doctors and Omnicare, the long-term care pharmacy provider, to prescribe and use its drugs, and targeted nursing homes patients.

Abbott Laboratories – $1.5 billion – May 2012

Abbott pled guilty to having trained special salespeople to target nursing homes in the illegal promotion of Depakote, an antipsychotic drug. The company admitted that it promoted the drug to nursing homes for use in controlling violent behavior in elderly dementia patients. The drug was never approved for that purpose and the company Abbott did not have its own evidence that the drug was safe or effective for those uses.

This data was reported by Propublica based on reports from the U.S. Department of Justice.