PharmaGossip: Nader names names concerning pharmaceutical industry fraud | Independent Political Report

[Guest guest]

http://pharmagossip.blogspot.com/2011/01/nader-names-names-concerning.html

Sunday, January 02, 2011

Nader names names concerning pharmaceutical industry fraud | Independent

Political Report

Ralph Nader has run for President of the United States as a Green Party

candidate, and more recently as an independent. The message below was sent out

as an e-mail announcement to Nader lists, and also appears on his nonpartisan

website, www.nader.org.

Pharmaceutical Industry Fraud

By Ralph Nader / Monday, December 27. 2010

The corporate defrauding of taxpayers (eg. Medicaid and Medicare) and

prescription drugs with skyrocketing prices was the subject of a report by

Public Citizen’s Dr. Sidney Wolfe and his associates (see Citizen.Org).

Dr. Wolfe’s team compiled a total of 165 federal and state settlements since

1991 totaling $19.8 billion in penalties. A key finding is that the drug

industry’s penalties under the Federal False Claims Act exceed even those

assessed against the overcharging defense industry for fraud.

Before we become overly impressed with the cumulative amount of the penalties,

specialists in corporate crime law enforcement believe that adding more federal

cops on the corporate crime beat, backed by a determined law and order Justice

Department with White House backing, would have greatly increased the number of

cases and imposition of penalties on these drug industry giants.

Nonetheless, Dr. Wolfe’s study shows that the pace of penalties has picked up

over the past five years. This is due to “a combination of increased violations

by companies and increased law enforcement on the part of federal and state

governments,” says the report.

Many of these cases were initiated by company whistleblowers, who under the

False Claims Act can receive a share of the settlements. Since the corporate

bosses of these drug firms are almost never prosecuted, what these executives

fear the most are company employees who go public with the evidence of corporate

misdeeds.

These violations do more than financial damage to consumers and government

health insurance programs. One of the worst violations involves companies

promoting unproven, often dangerous uses for their medicines. Last year, Pfizer

paid $1.2 billion for illegal off-label promotion -the largest criminal fine in

U.S.history. Other major corporate violators were GlaxoKline, Eli Lilly,

Schering-Plough, Bristol-Myers Squibb, AstraZeneca, TAP Pharmaceutical, Merck,

Serono, Purdue, Allergan, Novartis, Cephalon, & , Forest

Laboratories, Sanofi-aventis, Bayer, Mylan, Teva and King Pharmaceuticals.

The violations by these and other drug companies point to the wide range of

impacts, including taking many lives of patients, which stems from these

recurrent activities. These criminal or civil illegalities cover (1)

overcharging government health programs, (2) unlawful promotion, (3) monopoly

practices, (4) kickbacks, (5) concealing study findings, (6) poor manufacturing

practices, (7) environmental violations, (8) financial violations and (9)

illegal distribution.

Outside the purview of the Public Citizen study are the ravages of counterfeit

drugs and poorly inspected ingredients in drugs, now mostly coming from China

and India, due to the outsourcing by U.S. and European drug companies in their

thirst for even greater profits.

Drug company sales are huge, growing from $40 billion in 1990 to $234 billion in

2008, and far exceeding inflation with their annual price gouging. To make

matters worse, in 2003, the Congressional Republicans, with decisive support

from some Democrats, passed the drug benefit bill which explicitly prohibited

Uncle Sam, the payer, from bargaining for volume discounts with drug companies.

With over 400 full-time drug company lobbyists putting pressure on Congress, and

tens of millions of dollars flowing into the legislators’ campaign coffers,

budgets for federal investigators, prosecutors and inspectors are kept to a

minimum. Unfortunately, crime in the suites pays over and over again, despite

occasional penalties.

A bright spot is the increasing enforcement action at the state level.

By last year, 32 states had enacted false claims acts, including fourteen states

that qualified as strong laws by federal standards.

Still, the Wolfe report concludes that the “current system of enforcement is not

working.” He gives the examples of the $7.44 billion in financial penalties

assessed over the past twenty years on GlaxoKline and Pfizer, as compared

to their combined total of $16.5 billion in global net profits in one year

alone.

What would deter these illegal practices and risks to public safety? Dr. Wolfe

says “the lack of criminal prosecution that would result in jailing of company

executives.” is key. Moreover, the report notes that “a felony conviction could

result in their companies becoming ineligible for reimbursement from federal and

state health programs, a critical

source of pharmaceutical company revenues.”

A flicker of hope that a little change is on the way came from the Food and Drug

Administration’s Deputy Chief Counsel for Litigation, Blumberg. He

indicated that the government is considering going after drug company executives

for violations such as off-label promotions. He stated: “.unless the government

shows more resolve to criminally charge individuals-at all levels in the

corporate hierarchy–.we can not expect to make progress in deterring off-label

promotion.”

The problem is that the final operating decision is in the hands of the Justice

Department-historically short-staffed and short-willed to entreaties for

prosecution by the FDA and other regulatory agencies.

Furthermore, for over 30 years, the Justice Department has stone-walled requests

that it start a corporate crime database as it has done with street crimes.

Congress likes it this way, as it continues to cash corporate campaign checks.

Just last week, however, outgoing Judiciary Committee Chairman, Democrat

Conyers introduced a bill (H.R. 6545) to create such a corporate crime data base

in the Justice Department. Well, as the saying goes, everything starts with a

gesture!

via independentpoliticalreport.com

Posted via email from Jack's posterous

Sent via BlackBerry by AT & T