Big Pharma Fine

'But why?' you ask. Bad drug? Contaminated drug?

The pharmaceutical group GlaxoSmithKline has been fined $3bn (£1.9bn) after admitting bribing doctors and encouraging the prescription of unsuitable antidepressants to children. Glaxo is also expected to admit failing to report safety problems with the diabetes drug Avandia in a district court in Boston on Thursday.

The company encouraged sales reps in the US to mis-sell three drugs to doctors and lavished hospitality and kickbacks on those who agreed to write extra prescriptions, including trips to resorts in Bermuda, Jamaica and California.

The company admitted corporate misconduct over the antidepressants Paxil and Wellbutrin and asthma drug Advair.

Psychiatrists and their partners were flown to five-star hotels, on all-expenses-paid trips where speakers, paid up to $2,500 to attend, gave presentations on the drugs.

[...]

GSK held eight lavish three-day events in 2000 and 2001 at hotels in Puerto Rico, Hawaii and Palm Springs, California, to promote the drug to doctors for unapproved use.

[...]

GSK also paid for articles on its drugs to appear in medical journals.

  Guardian

So what about the doctors and the medical journals? They're not innocent here.

GSK also published an article in a medical journal that mis-stated the drug's safety for children, despite the journal asking several times to change the wording.

[...]

Despite knowing that three trials had failed to prove its effectiveness on children, Glaxo published a report entitled "Positioning Paxil in the adolescent depression market – getting a headstart".

Sorry. That's not the way it works. The journal published the article. If they published it with false statements, it's on them.

Oh, yeah...the lavish promotional trips for doctors utilized paid doctors as speakers and was aptly named by the sales reps: Operation Hustle.

GSK chief executive Andrew Witty said: "Whilst these [matters] originate in a different era for the company, they cannot and will not be ignored. On behalf of GlaxoSmithKline I want to express our regret and reiterate that we have learnt from the mistakes that were made."

What they learned was that they still come out ahead, even after fines.

Despite the large fine, $3bn is far less than the profits made from the drugs. Avandia has made $10.4bn in sales, Paxil took $11.6bn, and Wellbutrin sales were $5.9bn during the years covered by the settlement.

...but hey, do what you want...you will anyway.