Big pharma: a real war against drugs.

AuthorGrosso, Joseph
PositionPainting the Wasteland Green

The news on September 3 didn't even receive a front page headline in the New York Times. In fact it didn't even flash across the headlines of the Times Business Section. This is strange if only due to the fact that the news did have the novelty of involving the largest criminal fine of all time. That was what the pharmaceutical giant Pfizer, the world's largest drug maker, agreed to pay in a settlement with the Justice Department over unlawful prescription drug promotions. The fine itself came out to $1.2 billion. Plus Pfizer must pay another $1 billion to compensate Medicaid and Medicare which, along with a criminal forfeiture, totals $2.3 billion.

The criminal charge is related to a painkiller called Bextra, considered a Cox-2 inhibitor, which was pulled from the market back in 2005 due to mounting evidence that it increased the risk of heart attack, stroke, and death. According to the government, Bextra and several other drugs were promoted as treatment for medical conditions beyond the conditions for which the FDA had approved their use. It was the fourth such illegal marketing settlement for Pfizer in the last decade, and much like the other three it hardly put a dent in its fortunes--$2.3 billion amounts to less than three weeks of Pfizer sales--as its stock declined a mere 14 cents on the very day of the settlement, and the company announced plans to acquire rival drug maker Wyeth for $68 billion.

In the pharmaceutical industry, Pfizer may be the largest shark but it's hardly a solitary rogue when it comes to this sort of thing. In January of 2009 Eli Lilly coughed up $1.4 billion for its illegal marketing of Zyprexa, an anti-psychotic with the usual slew of side effects. Since 1992, more than a dozen drugs have been pulled from the market or had strict limits put on their use.

Back in 1976, Henry Gadsden, chief executive of Merck, lamented to Fortune magazine the tragedy that his company's market was limited only to those who were afflicted with illness when his dream had long been to sell to healthy people, therefore having a market that potentially included every person in the world. Well one can imagine the internal chuckle Mr. Gadsden would have enjoyed scanning the New York Times front page on September 2, 2009 (a day before the Pfizer settlement was announced) where it was gloriously revealed, this in a headline of course, "Taking Big Risk for Big Payoff, Industry Seeks Cancer Drugs." The article bluntly explained that, after...

To continue reading

Request your trial

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT