[e-drug] Glaxo to pay $3 bn for largest health care fraud in US

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E-DRUG: Glaxo to pay $3 bn for largest health care fraud in US
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http://www.washingtonpost.com/national/health-science/glaxosmithkline-to-pay-3b-in-largest-healthcare-fraud-settlement-in-us-history/2012/07/02/gJQArBKIJW_story.html
[Please fix URL if broken; article copied below as fair use]

Glaxo to pay $3 bn for largest health fraud in US
By Associated Press, Tuesday, July 3, 5:38 AM
TRENTON, N.J.

British drug maker GlaxoSmithKline will pay $3 billion in fines. The largest health care fraud settlement in U.S. history for criminal and civil violations involving 10 drugs that are taken by millions of people.

The Justice Department said Monday that GlaxoSmithKline PLC will plead guilty to promoting popular antidepressants Paxil and Wellbutrin for unapproved uses. The company also will plead guilty to failing to report to the government for seven years some safety problems with diabetes drug Avandia, which was restricted in the U.S. and banned in Europe after it was found in 2007 to sharply increase the risks of heart attacks and congestive heart failure.

In addition to the fine, Glaxo agreed to resolve civil liability for promoting Paxil, Wellbutrin, asthma drug Advair and two lesser-known drugs for unapproved uses. The company also resolved accusations that it overcharged the government-funded Medicaid program for some drugs, and that it paid kickbacks to doctors to prescribe several drugs including Flovent for asthma and Valtrex for genital herpes.

Sir Andrew Witty, Glaxo’s CEO, expressed regret Monday and said the company has learned from the mistakes that were made.

This is the latest in a string of settlements related to drug companies putting profits ahead of patients. In recent years, the government has cracked down on drug makers’ tactics, which include marketing medicines for unapproved uses. While doctors are allowed to prescribe medicines for any use, drug makers cannot promote them in any way that is not approved by the U.S. Food and Drug Administration.
“Let me be clear, we will not tolerate health care fraud,” Deputy Attorney General James M. Cole said Monday during a news conference at the Justice Department in Washington.

Glaxo is scheduled to plead guilty to the criminal charges and have the settlement approved at a hearing Thursday in U.S. District Court in Boston. In addition to the $3 billion penalty - which includes a $1 billion criminal fine and forfeiture and $2 billion to resolve civil claims - Glaxo agreed to be monitored by the government for five years to ensure that it complies with marketing and other rules.

The case against Glaxo was originally brought in January 2003 by two whistleblowers, former Glaxo sales representatives Greg Thorpe and Blair Hamrick. In January 2011, the federal government joined in the case.

Prosecutors said Glaxo illegally promoted Paxil for treating depression in children from 1998 to 2003, even though it wasn’t approved for anyone under age 18. The company also promoted Wellbutrin from 1999 through 2003 for weight loss, sexual dysfunction, substance addictions and attention deficit hyperactivity disorder, although it was only approved for treatment of major depression.

Starting in 2001, Thorpe reported to his district manager, then to Glaxo’s human resources department and finally to Glaxo’s chief of global compliance about a number of improper marketing practices. The compliance chief began an internal investigation, which confirmed Thorpe’s allegations through various ways including marketing materials and interviews with Hamrick and other sales representatives, according to lawyers for the two men.

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Dear colleagues

While as a pharmacologist I am impressed by many of these drugs, I firmly believe everyone should first identify the underlying cause of their problem and try to resolve using non-pharmacological methods. Almost all of these large companies have been charged for promoting their drugs in an unethical manner. It is impossible to trust anything they report at this point, as they have repeatedly shown they are more interested in profits rather than alleviating human suffering!

Chandra Sekar
[Please provide affiliation when posting - moderator]
sekar@findlay.edu

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Money fines are ok. But the real thing is: no GSK executives are going to prison?

Regards

Juan Bru
[Please provide affiliation when posting - moderator]
juan_bru@yahoo.es

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[Bonface want evidence before we ask for action against executives. I think it is the lack of prosecutions and the legal difficulties in doing so that gives rise to such calls - this is not the first case. As long as executives see no risk to themselves they have no incentive to ensure 'good practice', however that might be defined. Someone must/should accept responsibility in the chain of command. DB]

Dear colleagues,

What would be interesting in this matter is to establish the facts, particularly on how GSK addressed this matter. It would be informative to know exactly what role GSK executives played in this matter. It is quite frankly too easy and simplistic to assume pharma executives would outrightly condone behaviour by staff that puts at risk the status and credibility of a company such as this.

As we have seen in other industries (for example, the banking sector), traders, sales people at the coal face may practice in a manner that may not represent executive decisions. In many cases, the governance structures may not be that effectively applied as one approaches the coal face. In some cases, institutions' own (internal/external) audit processes tend to be the ones that find faulty practices and either report to the authorities or put into place corrective measures, or do both as required under the laws, regulations and governance arrangements.

It would interesting to establish what took place within the GSK administrative and governance structure and particularly what actions the institution took in this matter, and how cooperative it was with government in prosecuting this matter. While I recognise that none of us in the pharmaceutical sector ever accept to have the public / patients misled, misinformed, or abused in any way related to medicine selling and use, I think we need to ensure that our calls for stringent action against institutions and their staff are moderated by reference to the laws, legal procedure and indeed, the sense of fairness, and by particularly looking at the evidence.

Therefore, I think we as a community would be risking a lot if in such matters we started being judge and jury. Clearly any wrong doing that is established would be subject to the applicable laws. As a community, we may indeed advocate for setting up new laws, etc. to address shortcomings, bad practice, and the like. All of such advocacy would be underpinned by our sense of fairness, the rule of law, etc.

Regards,
Bonnie

Bonface Fundafunda PhD., MBA., B.Pharm
Manager and Technical Adviser,
Drug Supply Budget Line
Ministry of Health,
P.O. Box 30205,
Ndeke House,
Lusaka,
Zambia
Tel: +260 211 25 41 83
Fax: +260 211 25 33 44
Mobile: + 260 979 25 29 00
Email: bcfunda@hotmail.com

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Dear All

This a good contribution by Dr. FundaFunda to the discussion and outlines valuable evidence to be obtained, if possible. Given the evidence from other cases in how executives cover (or remove) their tracks, however, more effective would be to establish that the heads of any division are responsible for any patterned behavior by dint of their office. If they claimed they did not know their sales reps were, in numbers, saying or doing X (which they have claimed under oath in other cases) it would be irrelevant or untrue by dint of their responsibilities and an alleged indication of their incompetence as managers. In short, VPs of marketing or related persons would be prosecuted because organized lying or deception or misleading actions were taken under their command. (Good, specific examples are found in Harry Waxman's short summary report of the various concerted actions taken by Merck to counter early evidence that Vioxx was a deadly drug. See http://oversight-archive.waxman.house.gov/documents/20050505114932-41272.pdf [please fix URL if broken]

Don Light

Donald W. Light
Cell: 609-216-0071

Professor, UDMNJ-SOM
Visiting Researcher, Center for Migration & Development, Princeton University
Network Fellow, Safra Center for Ethics, Harvard University
Senior Fellow, Center for Bioethics, University of Pennsylvania

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Dear colleagues

I am worried that this is happening in a developed country where we believe things are done right than that which happens in developing countries.

Dr. (Mrs.) B.A. Aina
Dept. of Clinical Pharmacy and Biopharmacy
Faculty of Pharmacy
University of Lagos
CMUL Campus, Idi Araba,
Lagos, NIGERA
Tel +234 8023091623