Token Fine for GlaxoSmithKline Won't Stop BigPharma's Bad Behavior: Watchdog

Pharmaceutical mammoth GlaxoSmithKline (GSK) has been ordered to pay $3 billion fine in what is described as the largest case of healthcare fraud in U.S. history. But critics say it is just as a slap on the wrist as the amount "pales in comparison" to the profits pharmaceutical companies earn and does nothing to preclude such further behavior from big pharma.

GSK, which had $44 billion in sales and a net profit of nearly $9 billion in 2011, faces the fine for marketing its antidepressants Paxil and Wellbutrin for non-FDA-approved purposes, including marketing them to children, and for withholding from the FDA safety information for its diabetes drug Avandia.

Deputy U.S. Attorney General James Cole said, "At every level, we are determined to stop practices that jeopardize patients' health; harm taxpayers; and violate the public trust -- and this historic action is a clear warning to any company that chooses to break the law," he said.

But Dr. Sidney Wolfe, Director of Public Citizen's Health Research Group, states that this is in no way a "clear warning."

"The fines imposed on pharmaceutical companies for dangerous and illegal conduct pale in comparison to the profits generated from such activity. The industry is therefore tacitly encouraged to continue its illegal activity," Wolfe said in a statement.

"Until more meaningful penalties and the prospect of jail time for company heads who are responsible for such activity become commonplace, companies will continue defrauding the government and putting patients' lives in danger," added Wolfe.

Economist Dean Baker notes that GSK's lying about its drugs' safety and uses was incentivized by the monopolies drug companies are allowed to have. "This is the incentive that we give to drug companies when the government grants patent monopolies that allow them to sell drugs for hundreds or even thousands of times the cost of production."


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