GlaxoSmithKline: GUILTY in Largest Health Fraud Settlement in US History


By Dr. Mercola

One of the biggest news stories relating to health right now is the finalization of the biggest lawsuit yet by the American government against a pharmaceutical company.

On July 2, the British drug maker GlaxoSmithKline plead guilty to three counts of criminal misdemeanor and other civil liabilities relating to the prescription drugs Paxil, Wellbutrin and Avandia, and agreed to pay a total of $3 billion in fines–$1 billion to settle criminal charges, and $2 billion to cover civil liabilities.

The payment is the largest fraud settlement in U.S. history, and the largest fine ever paid by a drug company.

In 2009, Pfizer paid $2.3 billion to settle similar charges1, and as recently as May, Abbott Laboratories settled charges over wrongful marketing of the anti-seizure drug Depakote to the tune of $1.6 billion2. The company had illegally promoted the drug to health care providers for off-label use in seniors with dementia.

And, according to a July 6 report in the Huffington Post3, a federal investigation into wrongful marketing by Johnson & Johnson of its antipsychotic drug Risperdal is also wrapping up and may result in a fine of anywhere between $1.6 to 2 billion.

According to FiercePharma’s recent compilation of the Top 11 marketing settlements by the drug industry over the past 10 years4, drug makers have agreed to pay more than $11 billion in fines for their illegal marketing shenanigans over the past decade! But the worst may still lie ahead: more than 900 whistleblower lawsuits were filed in the last year alone and historically about 10 percent of whistleblower claims involve drugmakers…

While these fines sound like staggering amounts of money to most people, a fundamental problem has now become blatantly and painfully apparent, and that is that fines don’t work. They simply do not curtail criminal behavior when applied to faceless corporations. They’ve become little more than an expected annoyance that are calculated into the price of doing business.

Meanwhile, average people are paying for the criminal behavior of these “corporate personhoods” with their very lives.

Keep in mind that while “wrongful marketing” may not sound like a big deal, we’re not talking about a toy that you can’t play with in the manner advertised. We’re talking about extremely potent chemicals that alter brain and biological chemistry. When you consider how shoddy and fraught with conflicts of interest the approval process is to begin with—as poorly tested drugs are approved with increasing frequency and must later be withdrawn—it should be frighteningly obvious how dangerous it can be to market drugs for unapproved uses.

GlaxoSmithKline Guilty of Illegal Marketing and Withholding Hazard Info

When GSK began targeting children, Paxil became a top 10 selling drug with annual sales in excess of $1.8 billion in 2001 and 2002 alone. This is particularly grievous as, according to the Justice Department’s complaint5, several clinical studies on Paxil involving children and adolescents, performed in the mid- to late-90’s, had ALL FAILED to demonstrate efficacy on this age group! Every single one of them!

According to the US Justice Department6, GlaxoSmithKline:

  1. Unlawfully marketed the antidepressant Paxil to children and adolescents.
    The drug is FDA approved for the treatment of depression in adults only.The complaint details how GSK manipulated the findings of one of these studies to reach the false conclusion that Paxil was effective against depression in adolescents. A GSK employee also recommended revising a section of the study relating to side effects, removing the finding that serious side effects like worsening depression and hostility (suffered by 11 children in the study) were considered related to the treatment, and replacing it with a statement that headache (suffered by one participant) was the only side effect considered to be treatment-related.
  2. The complaint calls the study, published in July 2001 in The Journal of American Academy of Child and Adolescent Psychiatry, “false and misleading.” This fraudulent and misleading study was subsequently used by GSK to illegally promote Paxil for children and teens…

  3. Unlawfully marketed the antidepressant Wellbutrin for weight loss and sexual dysfunction.

    In a recent NPR radio interview7, Carmen Ortiz, U.S. Attorney for the District of Massachusetts, stated that “GSK hired a public relations firm to create a buzz about getting skinny and how you could have more sex simply by using this drug…using every imaginable form of high-priced entertainment, from Hawaiian vacations to paying doctors millions of dollars to go on speaking tours, to a European pheasant hunt, to tickets for Madonna concerts.”

  4. From 2001 through September 2007, failed to report safety data relating to clinical experience and other information as required by law to the FDA for the diabetes drug Avandia.

    As previously reported, Avandia has been found to be profoundly dangerous—a fact hid by GSK for over 10 years, as they knew it would adversely affect sales8. This was revealed in a Senate Finance Committee report, released by Max Baucus and Charles E. Grassley in February 2010. The report also asked why the FDA allowed a clinical trial of Avandia to continue even after the agency estimated the drug had caused an estimated 83,000 heart attacks between 1999 and 20079.

    Avandia hit the market in 1999 and quickly became a blockbuster drug. By 2006 its annual revenue was $3.2 billion. A year later, a damning study published in the New England Journal of Medicine (NEJM) linked it to a 43 percent increased risk of heart attack and a 64 percent higher risk of cardiovascular death than patients treated with other methods10.

    This is a steep price, to say the least, for a disease that does not require drugs to begin with, and Avandia has become a poster child for the lethal paradigm of faux science.

Why Isn’t Someone Going to Jail??

According to the July 2 press release issued by GSK11, the criminal and civil liabilities resolved by this final agreement also include inappropriate marketing of six other drugs, and “possible inappropriate use of the nominal price exception under the Medicaid Rebate Program.”

One aspect that truly worries me is that while the criminal cases we’ve seen in the past several years are related to drugs, many of these companies, including GSK, also produce VACCINES.

And guess what?

They’re typically not liable for damages from, or harm done by, contaminated or otherwise dangerous vaccines! We’ve recently seen evidence of “mistakes” in vaccine manufacturing as well, but vaccine makers are rarely if ever punished for these willful errors and omissions, which should provide you some further food for thought.

Celebrity Doctors Paid to Illegally Promote Dangerous Drugs

A few days after the US Justice Department reached its agreement with GSK, it was revealed that TV and radio personality Dr. Drew Pinsky (aka “Dr. Drew,” of sex-advice-giving fame) allegedly accepted $275,000 to carry out the illegal promotion of GSK’s antidepressant Wellbutrin. Dr. Pinsky is said to have highlighted the drug’s libido-enhancing side effects on a number of occasions in 199912, 13.

While Dr. Drew is the one in the news right now, he’s not the only TV and radio doctor who’s accepted money from drug companies to push their products to an unsuspecting public. For example, Dr. Marie Savard14, who has appeared on dozens of TV shows such as Good Morning America, ABC News, and Oprah, is paid by Merck to pitch their HPV vaccine.

According to a July 3 report in the Wall Street Journal15:

“In June 1999, popular radio personality Dr. Drew Pinsky used the airwaves to extol the virtues of GlaxoSmithKline’s antidepressant Wellbutrin, telling listeners he prescribes it and other medications to depressed patients because it “may enhance or at least not suppress sexual arousal” as much as other antidepressants do.

But one thing listeners didn’t know was that, two months before the program aired, Dr. Pinsky—who gained fame as “Dr. Drew” during years co-hosting a popular radio sex-advice show “Loveline”—received the second of two payments from Glaxo totaling $275,000 for “services for Wellbutrin.”

… Doctors are allowed to prescribe drugs as they see fit, but it is illegal for companies to promote drugs for uses not approved by the FDA, a practice known as “off-label” marketing. Wellbutrin’s prescribing label doesn’t state that the drug is less inhibiting of sexual libido than other antidepressants. In an email Tuesday, Glaxo declined to answer questions about its financial relationship with Dr. Pinsky or other physicians. The company said: “The complaint to which you refer concerns events in 1999, 13 years ago. It does not reflect what would be allowed in GSK today.”

I for one do not buy into any of this drivel about how things have changed… If anything, the evidence tells us that illegal and unethical behavior of corporations like GSK has WORSENED and solidified into standard modus operandi over the past decade. Case in point: According to a 2010 report by the Public Citizen’s Health Research Group, titled “Rapidly Increasing Criminal and Civil Monetary Penalties Against the Pharmaceutical Industry: 1991 to 2010”16:

“Of the 165 settlements comprising $19.8 billion in penalties during this 20-year interval, 73 percent of the settlements (121) and 75 percent of the penalties ($14.8 billion) have occurred in just the past five years (2006-2010). Four companies (GlaxoSmithKline, Pfizer, Eli Lilly, and Schering-Plough) accounted for more than half (53 percent or $10.5 billion) of all financial penalties imposed over the past two decades. These leading violators were among the world’s largest pharmaceutical companies.”

As I’ve reported before, pharmaceutical companies accounted for nearly 20 percent of the top 100 Corporate Criminals in the 1990’s, and there’s NO evidence to indicate that these shenanigans are in fact on the decline…

Bill Gates Connection to Glaxo Drug Fraud Scandal

Even the Gates Foundation has been linked to this massive scandal through the swinging doors of employment. According to a July 3 report by Tom Paulson on KPLU 88.517:

“Most news reports quoted GSK’s CEO Andrew Witty blaming the misconduct on others and “a different era for the company,” adding that such behavior will not be tolerated…

One of the most high-profile GSK executives alleged to have engaged in misbehavior is Tachi Yamada, former head of global health for the Bill & Melinda Gates Foundation who was before that head of research and development for GSK.

Yamada, while he was head of global health for Gates Fdn, was accused in a U.S. Senate hearing of bullying a scientist to not publish negative findings about a GSK diabetes drug. This was fairly big news at the time and such behavior is part of the federal complaint against the drug firm… But so far as I can tell, nobody has made any mention of Yamada’s role in this case. Yet he was pretty high profile — at the center of the controversy surrounding the drug company’s attempt to cover-up adverse side effects of its diabetes drug Avandia.

… Yamada… recently left the Gates Foundation to work for a Japanese drug company… But there’s no getting away that Yamada played a leading role in the largest health fraud case in American history and that, given his much greater influence as head of a philanthropic program that many say sets the agenda for global health, it might be worth mentioning.”

Indeed, the Gates Foundation is deeply entrenched in an unholy alliance with both Big Pharma and Monsanto. For example, 2011 Wikileaks documents detailed the alliance between the U.S. State Department and the Gates Foundation Alliance for a Green Revolution in Africa (AGRA) to promote the private interests of Monsanto in an effort to turn Africa into a GMO-friendly continent. High level officials leading AGRA are in fact former Monsanto executives, and the Gates Foundation also owns Monsanto stock. Other ties that bind the Gates Foundation to Big Pharma and Monsanto include the following close associations:

  • Vice president of Monsanto Robert Horsch joined the Gates Foundation in 2006
  • Merck CEO Raymond Gilmartin was placed on the Gates Foundation Board of Directors in 2001
  • Gates invested $205 million in nine of the large pharmaceutical companies in 2002

Why are Children Sacrificed as Guinea Pigs?

GSK and the rest of the Big Pharma cronies want you to believe that “things have changed;” that they’ve “learned from their mistakes,” and that everything is fine now since the real wrongdoers like Tachi Yamada have moved on to other venues. Now, they promise, your health and well-being is at the forefront of everyone’s mind working in the pharmaceutical industry. Think again. A recent story on TechDirt.com18 really underscores the perverse nature of drug company greed:

“… Purdue Pharma, the makers of the highly addictive painkiller OxyContin, is now running clinical tests to get the FDA to approve its use for kids as young as 6-years old19.


Because the Federal Food, Drug, and Cosmetic Act section 505A20 includes a little “gift”: if drugmakers conduct clinical studies for their drugs with kids, they can get six more months of patent protection. So even if they don’t even sell OxyContin to six year olds, just securing the extended patent, thanks to the massive monopoly rents given to drugs still on patent, Purdue is likely to profit massively. Lots of people are reasonably troubled by this:

“They are doing (the pediatric trial) for patent exclusivity, there’s no doubt about it in my mind — not out of largesse,” said Dr. Elliot Krane, director of pain management at Lucile Packard Children’s Hospital at Stanford University in Palo Alto, Calif…”

This is about as crazy as it gets, folks. How many young children could possibly be in need of a potent narcotic pain reliever like OxyContin? Not to mention the fact that this particular drug has been identified as one of the absolute most problematic in terms of drug abuse and death. To say that the incentive for this kind of drug trial is questionable would be an understatement. It’s downright abhorrent, and it speaks volumes about the ethics, or rather lack thereof, that drives the pharmaceutical industry as a whole.

Prescription Painkillers: New “Gateway Drug”

For the longest time marijuana, smoking and alcohol were the first drugs of choice by those who later may move into more hard-core drugs; hence the term “gateway drug.” But things have changed a lot in recent years. Prescription drugs—especially prescription pain killers like OxyContin—are now leading the pack as the most common “gateway” to illegal drug use, and the consequences are far deadlier.

According to a July 6 press release21:

“… Since 2000, the drugs sending people to their graves or to rehab have been shifting away from illicit drugs and toward prescription drugs. The 2011 report on the subject from the Centers for Disease Control and Prevention made it clear: prescription narcotic pain reliever overdose deaths now exceed the number of deaths from heroin and cocaine combined.

For decades now, it has been usual that many young people looking for a drug to experiment with for the first time would choose marijuana… The Narconon Arrowhead drug rehabilitation program has recently uncovered a new pattern since prescription opiates have increasingly become the first drug used by many young people. This pattern is backed up by government surveyed results. According to Michael Botticelli, Director of the Massachusetts Bureau of Substance Abuse, prescription drugs now equal marijuana as entry-level drugs.

… “Our own clients and people calling in daily for information about our program or help have told us story after story about addictions starting with the use of prescription drugs,” stated Derry Hallmark, Director of Admissions at Narconon Arrowhead, a premier drug rehab facility in Southeastern Oklahoma. “Sadly, prescription medications have become the newest of the gateway drugs. Sadder still are the losses of life and other severe consequences that go hand in hand with drug abuse, which is especially the case with prescription drug abuse.”

Hallmark adds that those addicted to prescriptions will often end up needing treatment or will even start taking illicit drugs. One of the most common examples of this is the connection between those addicted to painkillers that then start taking heroin…”

Fines Alone Cannot Change Drug Co. Criminality

It has become abundantly clear that fines do NOT work. In order to see any changes whatsoever in the rampant criminal behavior enveloping the drug industry, the Justice Department must slap criminal charges on the individuals responsible for, and complicit with, these criminal acts. Quite simply, those engaging in fraud need to know they can be held personally liable and face time in federal prison for their crimes.

A number of recent articles in the press have highlighted this now obvious fact, and brought up related issues that really need to be addressed. For example, Judith Warner, writing for Time Magazine states:

“… we are confronted, yet again, with the fact that these fines, however punitive-seeming on their face, are chump change in comparison to the company’s bottom line and highly unlikely to bring real change to its — or, indeed, the industry’s — future practices… Glaxo wasn’t exactly ruined by the fines: In the years covered by the settlement, the company had earned $10.4 billion in sales of Avandia, $11.6 billion from Paxil, and $5.9 billion from Wellbutrin

A number of commentators… argued that seeking monetary damages isn’t going to change most problematic practices of the pharmaceutical industry. Instead, they say, we should seek criminal charges against specific executives, the risk of jail time being the only way to actually change behavior. Though such a solution certainly offers the prospect of some real gut-level satisfaction, I’m not convinced that it will actually show results. (Given the enormous resources, legal and otherwise, of the drug companies, I think it’s fair to assume that they’d be quickly able to figure out methods of Teflon-shielding their executives.)

Such a strategy also doesn’t address the fundamental problems that have enabled, if not created, Big Pharma’s repeat bad behavior: a balance of power between the industry and our government that is seriously askew, and a particular lack of smart regulation… over the way information about specific drugs is controlled, verified, and disseminated.” [Emphasis mine]

She brings up an excellent point, which is that the entire system is broken and a number of changes need to be implemented to put an end to this no-holds-barred profit-driven era of faux-science-derived medicine. The health care system is driven and controlled by Big Pharma, which churns out a mind-boggling amount of faked and flawed science to justify its recommendations, while simultaneously purchasing the “right” to monopolize the health industry via strategically placed industry lackeys in various positions of political and federal power.

Still, I believe holding individuals accountable for the criminal activities performed under the auspice of corporate personhood is a must, and would serve as a good starting point to weed out the most heinous psychopaths.

Robert Reich, Chancellor’s Professor of Public Policy at the University of California and former Secretary of Labor in the Clinton administration also addressed this issue in a recent Huffington Post article, and brought up two more vital points of..

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