Skip to comments.GlaxoSmithKline to pay $3 billion for health fraud
Posted on 07/02/2012 3:54:47 PM PDT by Moose4
WASHINGTON -- GlaxoSmithKline LLC will pay $3 billion and plead guilty to promoting two popular drugs for unapproved uses and to failing to disclose important safety information on a third in the largest health care fraud settlement in U.S. history, the Justice Department said Monday.
Accompanying the criminal case was a civil settlement in which the government said the company's improper marketing included providing doctors with expensive resort vacations, European hunting trips, high-paid speaking tours and even tickets to a Madonna concert.
The $3 billion combined criminal-civil fine will be the largest penalty ever paid by a drug company, Deputy Attorney General James M. Cole said. The corporation also agreed to be monitored by government officials for five years to attempt to ensure the company's compliance, Cole said.
(Excerpt) Read more at newsobserver.com ...
BTW, if you're wondering why senior management isn't being prosecuted? GSK is actually incorporated in the United Kingdom. The man who was the CEO at the time most of this happened, Jean Paul Garnier, is French.
I feel for the friends I've got that are working there still, because this may cause another round of layoffs. But how else do you punish a massive multinational corporation with $42 billion in annual turnover for something like this?
That is a big tax. . .
You nailed that. That'll sure buy a few asprins for the poor.
Not that the industry is immune to fraud.
How are consumers compensated? (crickets)
$3 Billion is a massive hit?
$3 Billion is chump change. It’s considered a Line Item Expense by manufacturers figured in Before the start of a production run.
GSK’s Seroxat is sold in America as Paxil, exact same drug. The active ingredient is Paroxetine.
The person, dixiefid64, who made that vid suffered GSK’s 2 week discontinuation syndrome, for 22 MONTHS! He had to use a safety razor blade to shave the tablets down to taper off the drug.
Watch Britain’s Breckenridge squirm.
Watch Benbow play the wounded innocent.
No Suicide Risk?
Look it up.
Only the US, in Less than 5 years, and only the suicides and attempts that got reported, because reporting drug AERs is Not Mandatory, it’s Voluntary.
Paroxetine Reported By
Adverse Reaction Cases MD CN OT PH LW NR
Suicidal Ideations 1,837 1,281 1,176 189 50 401 160
Attempted Suicides 786 592 522 121 89 151 48
Completed Suicides 921 616 474 78 34 631 51
Deaths Not From Suicide 238 141 131 21 19 4 33
Homicidal Ideations 136 53 144 28 11 22 4
Homicides 78 23 66 3 0 17 11
Hypomania/Mania 297 189 210 29 15 9 17
Heart Disease 1,149 432 1,436 1,236 595 381 48
Movement Disorders 2,273 1,207 1,416 237 129 468 163
Birth Defects 2,154 446 2,895 1,378 631 407 57
Premature Births 121 74 103 158 71 14 11
Prenatal/Neonatal Deaths 153 65 105 17 17 14 9
It Should have been $30 Billion and Felony convictions which would shut GSK Out of Medicare/Medicaid for 5 years.
And our own FDA isn’t One Bit better or more honest about cleaning up Pharmaceutical Fraud than the UK’s MHRA is.
This is probably a bad thing to say but I cannot help but wonder who they pissed off. Corporate crimes are rarely prosecuted and it is not because they do not commit crimes. Just look at the banking industry.
The DOJ is not a corporation but look at all their lawlessness. They make GSK look like saints.
I take it that you are an ObamaCare cheerleader. You will fit right in the New World Order.
Maybe someone should check out all those white coats that stood by Obama when he was cheerleading Obamacare! See how many have increased their wealth and/or if they even were doctors!
Well, GSK, like the rest of Big Pharma, has been sucking up to the Obama regime in the hopes of making big money off Obamacare.
The Avandia stuff they note in that article, now that was known around GSK, but the stuff they’d released internally to employees seemed to imply that the Avandia issues were over and done with, they’d taken a huge writeoff on it a year or two ago, and moved on. They really screwed up on that one.
You’re right that they’re rarely prosecuted, but with drug companies they get Caught so often that our Fed Govt can’t ignore them, so instead they make a show of it, collect what appear to be massive fines, and let them plead out to misdemeanor marketing violations.
The misdemeanor angle, no matter HOW many people drug companies knowingly cripple and kill, is because any felony conviction that endangers the Medicare or Medicaid programs will shut the company out of those programs for 5 years.
And 5 years without Medicare or Medicaid is a death sentence to any drug company.
Who do you think engineered Obamacare? Who stood to benefit from it, even short term?
It wasn’t the Insurance Companies.
It wasn’t the Hospitals.
It wasn’t the Doctors.
Who do you think put BO Rex on the throne?
It might be advisable, before you hit the knee jerk button again, to click on another poster’s screen monitor and actually READ some of their commenting history.
Either they screwed up so big they HAD to get busted, or they didn't grease the right palm. One of the many reasons I am not the ‘Big Capital’ type of conservative is that I have seen way to much of this type of thing. It is also one of the reasons I am very careful in what I eat and drink.
Had friends who worked in pharma. This is very common, and honestly expected.
Does this sound like the kind of upstanding, Conservative, Gee Whiz Folks, What a Great, All American Company you’d want to buy stock in?
NARRATIVE A school supt was arrested in the fall of 2010 and charged with 17 counts of bribery, mail fraud and wire fraud. Authorities say that while serving as Toms River schools supt--the NJ school supt and a Maryland insurance broker--concocted a scheme to inflate school insurance charges and kick back part of the money to as bribes.
The two are accused of concealing more than $1 million in bribes from insurance brokers and other service providers.
The insurance company, Federal Hill Risk Management, served as the insurance broker for the school district since 1978. Court documents say the two men spent stolen money on home renovations, watches that cost tens of thousands of dollars, and other personal expenses. The supt also allegedly bought one girlfriend - who was also on the school district payroll - a car and other gifts, including money for the college tuition of one of her relatives, according to court papers.
A federal investigation of the insurance broker of Baltimore continues WRT bilking municipal and school insurance plans---he is under state indictment for allegedly bilking $2.6 million from Perth Amboy schools and more than $200,000 from the municipality, and was indicted by a federal grand jury.
The crooked broker's son-in-law and a business partner were charged with stealing $216,000 from Perth Amboy for a non-existent wellness program for city workers.
A NJ state grand jury issued an indictment in July charging the broker and two of Gartlands companies, with a host of charges including money laundering, conspiracy, forgery and theft by deception.
Authorities said they bilked $2.6 million from the Perth Amboy schools over a six-year period. All defendants named in multiple indictments pleaded not guilty.
A third insurance man, of Bernardsville, pleaded guilty to theft by deception and false representation for a government contract in the same scheme targeting the school district.
The co-conspirator are alleged to have lied to the NJ schools insurance carrier, Cigna----the insurance/educator cabal told Cigna Insurance Company that "the Toms River school board authorized" the insurance carrier to pay them fees on behalf of the school board from its medical claims bank account for health care related programs and services that never existed, authorities said.
That money, stolen from Nov 2003 to July 2009, went into kickback accounts controlled by the crooked insurance broker, the indictment alleges.
I bet these pills make people poop on the food carts on airplanes, too.
The sad part is when I read headlines like, “GlaxoSmithKline to pay $3 billion for health fraud” I no longer think badly about companies like GlaxoSmithKline. I now just figure our government is extorting them somehow into paying the “fines”. In my opinion, it is just an additional cost of doing business.
“GlaxoSmithKline LLC will pay $3 billion ...”
Who receives this payment? How much goes to lawyers?
I think a bunch of socialists engineered Obamacare, not the pharmaceutical companies. It really paid off for GlaxoSmithKline to get fined $3 billion, didn’t it? Yea, that’s some smart marketing there for you.
You and a number of others on this thread sure don’t sound like conservatives. You are the bunch of knee jerkers going off because some big pharmaceutical got fined and you think it’s justified.
Why are you attacking the poster?
He came with links and much info....You on the other hand called him names.
Lemme guess, you’re invested in this company?
The biggest problem with ObamaTax (now that it's rewritten as such by John Roberts - there was no "care" in ObamaCareMandate, either) is not that it would become a problem "once the crooks get their filthy hands on it" but that, besides the crooks who already have their hands in every Big Government "program/entitlement/service/stimulus" etc., the biggest crook/thief/embezzler/beneficiary would be the Big Government and entitled bureaucracy itself.
The crooks already know very well that the Big Government is the place where one should look for money because that's really where the Big Money is:
From Tampa, six other cities targeted in Medicare fraud busts - TBO (Tampa Bay Online), by Kelli Kennedy and Pete Yost, 2012 May 02
It was the latest in a string of major arrests in the past two years as authorities have targeted fraud that's believed to cost the government between $60 billion and $90 billion each year. Stopping Medicare's budget from hemorrhaging that money will be key to paying for President Barack Obama's health care overhaul. ..... < snip > ..... Today, hundreds of federal agents fanned out around the country, raiding businesses, seizing documents and charging 107 suspects in Miami, Los Angeles, Houston, Detroit, Chicago, Tampa, Fla., and Baton Rouge, La. The government suspended payment to 52 providers as part of the investigations. ..... < snip > ..... Among those arrested Wednesday were the owners of two community mental health centers in Baton Rouge, charged with billing $225 million in their scams. Hoor Naz Jafri and Roslyn Dogan allegedly recruited vulnerable patients, including elderly people, drug addicts and the mentally ill. Patient charts were doctored to show services that were billed to Medicare but often never given, according to an indictment. Authorities suspended their companies in May 2011, but the pair continued billing Medicare after purchasing another fraudulent company, according to the indictment. When feds shut down that company, the pair tried to sell their "beneficiaries" to other providers in an attempt to keep making money. ..... < snip >
Federal authorities charged 107 doctors, nurses and social workers in Tampa and six other cities with Medicare fraud today in a nationwide crackdown on unrelated scams that allegedly billed the taxpayer-funded program of $452 million the highest dollar amount in a single Medicare bust in U.S. history.
It was the latest in a string of major arrests in the past two years as authorities have targeted fraud that's believed to cost the government between $60 billion and $90 billion each year. Stopping Medicare's budget from hemorrhaging that money will be key to paying for President Barack Obama's health care overhaul. ..... < snip >
..... Today, hundreds of federal agents fanned out around the country, raiding businesses, seizing documents and charging 107 suspects in Miami, Los Angeles, Houston, Detroit, Chicago, Tampa, Fla., and Baton Rouge, La. The government suspended payment to 52 providers as part of the investigations. ..... < snip >
..... Among those arrested Wednesday were the owners of two community mental health centers in Baton Rouge, charged with billing $225 million in their scams. Hoor Naz Jafri and Roslyn Dogan allegedly recruited vulnerable patients, including elderly people, drug addicts and the mentally ill. Patient charts were doctored to show services that were billed to Medicare but often never given, according to an indictment.
Authorities suspended their companies in May 2011, but the pair continued billing Medicare after purchasing another fraudulent company, according to the indictment. When feds shut down that company, the pair tried to sell their "beneficiaries" to other providers in an attempt to keep making money. ..... < snip >
That's just one of many such Medicare and Medicaid frauds.
Of course, with so much more money and more Byzantine laws, mandates, rules and regulations under ObamaCareHealthInsuranceTaxMandate it would be even easier for crooks to "legally" make even more money (when nobody even knows if it's TAX or a MANDATE, the Feds and the defense lawyers would be able to treat it any way it suits them, to claim and/or decide the "guilt" or the "innocence" of the involved).
fine disgusting mess - politicians, government policy wonks, lawyers and bureaucrats' paradise!
From Glaxo in $3 Billion Settlement - WSJ (sub), by Jeanne Whalen, Devlin Barrett and Peter Loftus, 2012 July 02
Under the deal, which requires court approval, Glaxo will plead guilty to criminal charges involving three drugs the antidepressants Paxil and Wellbutrin and the diabetes drug Avandia. The settlement includes $1 billion in criminal fines and $2 billion to resolve civil liabilities owed to the federal government and the states, the Justice Department said. Glaxo had announced the settlement's size in November. The guilty plea covers a range of behavior by the U.K.-based company, including illegally promoting the antidepressants in the U.S. for uses that weren't approved by the Food and Drug Administration, a practice known as off-label marketing, and withholding important safety data about Avandia from the U.S. regulator. The settlement was Glaxo's fourth with the U.S. government in the past several years but is by far its costliest and most far-reaching. Over a period of more than a decade, the government's latest investigation found, the company plied doctors with perks such as free spa treatments, Colorado ski trips, pheasant-hunting jaunts to Europe and Madonna concert tickets, Justice Department officials said. Meanwhile, it encouraged those doctors to write prescriptions for the two antidepressants that went beyond their sanctioned uses. U.S. law bars companies from marketing a drug for uses not approved by the Food and Drug Administration, though doctors may prescribe approved drugs as they see fit. ..... < snip >
Drug maker GlaxoSmithKline PLC agreed to plead guilty to criminal charges of illegally marketing drugs and withholding safety data from U.S. regulators, and to pay $3 billion to the government in what the Justice Department called the largest health-care fraud settlement in U.S. history.
Under the deal, which requires court approval, Glaxo will plead guilty to criminal charges involving three drugs the antidepressants Paxil and Wellbutrin and the diabetes drug Avandia. The settlement includes $1 billion in criminal fines and $2 billion to resolve civil liabilities owed to the federal government and the states, the Justice Department said. Glaxo had announced the settlement's size in November.
The guilty plea covers a range of behavior by the U.K.-based company, including illegally promoting the antidepressants in the U.S. for uses that weren't approved by the Food and Drug Administration, a practice known as off-label marketing, and withholding important safety data about Avandia from the U.S. regulator.
The settlement was Glaxo's fourth with the U.S. government in the past several years but is by far its costliest and most far-reaching. Over a period of more than a decade, the government's latest investigation found, the company plied doctors with perks such as free spa treatments, Colorado ski trips, pheasant-hunting jaunts to Europe and Madonna concert tickets, Justice Department officials said.
Meanwhile, it encouraged those doctors to write prescriptions for the two antidepressants that went beyond their sanctioned uses. U.S. law bars companies from marketing a drug for uses not approved by the Food and Drug Administration, though doctors may prescribe approved drugs as they see fit. ..... < snip >
Pheasant-hunting jaunts and tickets to Madonna concerts? That SHOULD BE criminal.
Oh, about the settlement's fines, money... The money goes to DoJ and SAOs... Sorry, Charlie... and Joan Q. Public. No real harm was done to the consumers, just "illegal marketing" of product "not approved by FDA."
Notice it doesn’t say that the meds were ineffective in their off labelnuses, just that the uses were not government approved.
Need to think about that one.
Glaxo settled without admitting to any wrongdoing to both criminal and civil charges as well as "compensatory" amount to government for their "investigations".
The beneficiaries, outside of DoJ and SAOs, will be 3 (or possibly more) whistleblowers (and their lawyers) who provided the basis for the charges and settlement by filing the lawsuit in 2003 in Boston, under the whistleblower statutes on a qui tam provision on the government behalf under the Federal False Claims Act.
They are former senior management employees of Glaxo, Thomas Gerahty and Mathew Burke; lawyers say that plaintiffs are usually entitled to between 15% and 30% of government's civil suit "recovery" amount.
Let's not forget that doctor have prescribed off-label use of many drugs that were deemed either more effective or cheaper substitute with the same efficacy as the FDA-approved drug for certain diseases.
The most recent highly publicized "controversy" was the use of cancer drug Avastin instead of much more expensive and difficult to obtain Lucentis, for the treatment of wet AMD (age-related macular degeneration) which is the leading cause of blindness, usually in the elderly. Some ophthalmologists even considered Avastin more effective than Lucentis for certain forms of AMD.
Caver, define your concept of Conservative, please.
1: crony capitalism:
When did crony capitalism, knowing, intentional, ongoing conduct constituting direct violations of activities already prohibited by law, and socialist redistribution become Conservative Values?
Heres what it costs drug companies to Buy FDA approval for their products.
PDUFA user fee archive
Heres what Congress has just done
PDUFA fee increase
The FDA user fee reauthorization bill has passed Congress and now only needs to be signed by President Obama. It kicks off a five-year stretch in which the FDA will have more money and new authorities in hopes that it will approve drugs faster (which is good for the industry) and theoretically cut costs for consumers and taxpayers through faster approval of generics.
The law will provide more than $6 billion in user fees over the five years
Before the recent PDUFA user fee increase, FDA was already receiving over a Fifth of its operating budget from drug and device manufacturers. Do you find any potential conflict of interest there? Whose interests do you believe FDA is more concerned with protecting? The consumer or the manufacturer? Up from $600 Million to $1.2 Billion a year?
2: GSK Illegal Conduct
Engaging in monetary transactions in property derived from specified unlawful activity.
US 18C95 Sec 1957
Most of those tens of Billions flowing into GSKs coffers are Not a Voluntary Financial Transaction on your part or anyone elses part. Those tens of Billions are predominantly coming out of Medicare and Medicaid through the Center for Medicare Services. You are being forced, by Government, to Pay GSK those tens of Billions.
FDA is a trainwreck of industry corrupted politicking. The author, Paul Thacker, has street cred. He was Sen. Charles Grassleys chief investigator when Grassley on the Senate Finance Committee was investigating drug industry corruption of Medical Research at the University level. Crooked Academics were taking Big Money from drug makers and not reporting it while simultaneously ginning up crap research which was used as a marketing device to sell and oversell drug company products.
Paxil Study 329
Study 329 is very old news, and barely the tip of the iceberg.
When did crony capitalism, criminal misconduct, and socialist redistribution become Conservative Values?
There are far more Federal Criminal statutes which are applicable to GSK just for their Seroxat, Paxil and the 1 I’ve quoted, if You violate it, will get You jail time in a heartbeat. Is it a Conservative Value to look the other way when You are being charged through CMS to sell Suicide and Murder at GSK’s behest?
People will steal 10’s of BILLIONS from Obamacare !
Like I said, a felony conviction is the last thing any drug co. wants and DOJ let’s them get away with all kinds of criminal abuse.
Merck paid a $950 Million Fed Fine and plead guilty to a Misdemeanor Misbranding charge.
AFTER, they’d ALREADY PAID the surviving family members of 3,468 people they Killed with Vioxx while they were breaking the law by marketing the stuff illegally.
They admitted they broke the law, and that they were responsible for killing 3,468 people, and DOJ let them buy their way out of it.
Or How about Pfizer?
They got popped for $2.3 Billion and they had their shell co, Pharmacia Upjohn take the fall for it because that fall was a felony, no more Medicare bucks for 5 years if Pfizer ate the felony themselves.
“Bextra settlement of off-label marketing investigation
In September 2009, the United States Department of Justice announced that Pfizer had agreed to pay $2.3 billion to settle civil and criminal allegations that it had illegally marketed four drugs: Bextra, Geodon, Zyvox, and Lyrica “with the intent to defraud or mislead” by promoting the drugs for non-approved uses; this marks Pfizer’s fourth such settlement in a decade. Pharmacia & Upjohn Company, Inc., a Pfizer subsidiary, agreed to plead guilty to mis-branded promotion of Bextra, a FELONY violation of the Food, Drug and Cosmetic Act. “
To salute these companies as examples of Free Market Capitalism is as ridiculous as writing a bank robber a ticket for an expired meter out front while he was robbing the bank.
It's going to get soooooo much worse.
Here’s analysis of GSK’s press release re: the $3 Billion charge.
It includes a link to the actual GSK release, below