September, 02 2009, 02:44pm EDT
$2.3 Billion Pfizer Settlement Is Not Enough to Deter Organized Crime in the Pharmaceutical Industry
Statement of Sidney Wolfe, M.D., Director, Public Citizen’s Health Research Group
WASHINGTON
Today's $2.3 billion settlement between Pfizer and the U.S. Justice Department for unlawful prescription drug promotion may sound large, but it's not enough to ensure drug companies will curb their bad behavior. In fact, it just shows there is competition in the pharmaceutical industry. Pfizer has broken a record just set by Eli Lilly & Company in January for what was then described by the Justice Department as the "largest individual corporate criminal fine" in U.S. history (more than $500 million in criminal penalties for off-label promotion of Zyprexa). Now, a scant seven months later, Pfizer has broken this record with a criminal fine of $1.2 billion, the largest criminal fine ever imposed in the U.S. for any matter. (The rest of the $2.3 billion represents civil penalties.)
The U.S. pharmaceutical industry, long one of the most profitable in the country, with profits last year of close to $50 billion, has engaged in an unprecedented amount of criminal activity in the past decade, all aimed at increasing sales, often by illegally promoting drugs for diseases for which evidence that benefits outweigh harm is lacking (also known as illegal off-label promotion). When doctors are induced, either by being bribed or misled by drug companies, to prescribe drugs for such purposes, there is a reasonable chance that the drugs will do more harm than good and patients may be seriously injured or killed by such promotion.
In addition to Pfizer and Eli Lilly (Pfizer also pleaded guilty to criminal charges for off-label promotion of Neurontin in 2004), other drug companies found to have engaged in criminal activity in the past 10 years include Abbott, Schering-Plough, Astra-Zeneca, Purdue and Bayer.
Unfortunately, the ever-escalating fines are unlikely to stop drug companies from continuing to bribe doctors because they represent just a fraction of drug company profits and no one has gone to jail.
There is no doubt that the pharmaceutical industry has made major contributions to the health of the public, but it must also be considered part of well-organized crime in this country. It is not surprising that the American public understands this; in a Harris Poll last fall, only 10 percent of respondents thought that the pharmaceutical industry was "generally honest and trustworthy - so that you normally believe a statement by a company in that industry."
Until corporate titans are forced to fork over a much larger proportion of their illegally gotten profits and are put behind bars, nothing will change.
Public Citizen is a nonprofit consumer advocacy organization that champions the public interest in the halls of power. We defend democracy, resist corporate power and work to ensure that government works for the people - not for big corporations. Founded in 1971, we now have 500,000 members and supporters throughout the country.
(202) 588-1000LATEST NEWS
Sanders Says 'Political Movement,' Not Murder, Is the Path to Medicare for All
"Killing people is not the way we're going to reform our healthcare system," he said. "The way we're going to reform our healthcare system is having people come together."
Dec 12, 2024
Addressing the assassination of UnitedHealthcare CEO Brian Thompson and conversations it has sparked about the country's for-profit system, longtime Medicare for All advocate Sen. Bernie Sanders on Wednesday condemned the murder and stressed that getting to universal coverage will require a movement challenging corporate money in politics.
"Look, when we talk about the healthcare crisis, in my view, and I think the view of a majority of Americans, the current system is broken, it is dysfunctional, it is cruel, and it is wildly inefficient—far too expensive," said Sanders (I-Vt.), whose position is backed up by various polls.
"The reason we have not joined virtually every other major country on Earth in guaranteeing healthcare to all people as a human right is the political power and financial power of the insurance industry and drug companies," he told Jacobin. "It will take a political revolution in this country to get Congress to say, 'You know what, we're here to represent ordinary people, to provide quality care to ordinary people as a human right,' and not to worry about the profits of insurance and drug companies."
Asked about Thompson's alleged killer—26-year-old Luigi Mangione, whose reported manifesto railed against the nation's expensive healthcare system and low life expectancy—Sanders said: "You don't kill people. It's abhorrent. I condemn it wholeheartedly. It was a terrible act. But what it did show online is that many, many people are furious at the health insurance companies who make huge profits denying them and their families the healthcare that they desperately need."
"What you're seeing, the outpouring of anger at the insurance companies, is a reflection of how people feel about the current healthcare system."
"What you're seeing, the outpouring of anger at the insurance companies, is a reflection of how people feel about the current healthcare system," he continued, noting the tens of thousands of Americans who die each year because they can't get to a doctor.
"Killing people is not the way we're going to reform our healthcare system," Sanders added. "The way we're going to reform our healthcare system is having people come together and understanding that it is the right of every American to be able to walk into a doctor's office when they need to and not have to take out their wallet."
"The way we're going to bring about the kind of fundamental changes we need in healthcare is, in fact, by a political movement which understands the government has got to represent all of us, not just the 1%," the senator told Jacobin.
The 83-year-old Vermonter, who was just reelected to what he says is likely his last six-year term, is an Independent but caucuses with Democrats and sought their presidential nomination in 2016 and 2020. He has urged the Democratic Party to recognize why some working-class voters have abandoned it since Republicans won the White House and both chambers of Congress last month. A refusal to take on insurance and drug companies and overhaul the healthcare system, he argues, is one reason.
Sanders—one of the few members of Congress who regularly talks about Medicare for All—isn't alone in suggesting that unsympathetic responses to Thompson's murder can be explained by a privatized healthcare system that fails so many people.
In addition to highlighting Sanders' interview on social media, Congressman Ro Khanna (D-Calif.) pointed out to Business Insider on Wednesday that "you've got thousands of people that are sharing their stories of frustration" in the wake of Thompson's death.
Khanna—a co-sponsor of the Medicare for All Act, led in the House of Representatives by Congressional Progressive Caucus Chair Pramila Jayapal (D-Wash.)—made the case that you can recognize those stories without accepting the assassination.
"You condemn the murder of an insurance executive who was a father of two kids," he said. "At the same time, you say there's obviously an outpouring behavior of people whose claims are being denied, and we need to reform the system."
Two other Medicare for All advocates, Reps. Maxwell Frost (D-Fla.) and Alexandria Ocasio-Cortez (D-N.Y.), also made clear to Business Insider that they oppose Thompson's murder but understand some of the responses to it.
"Of course, we don't want to see the chaos that vigilantism presents," said Ocasio-Cortez. "We also don't want to see the extreme suffering that millions of Americans confront when your life changes overnight from a horrific diagnosis, and people are led to just some of the worst, not just health events, but the worst financial events of their and their family's lives."
Sen. Elizabeth Warren (D-Mass.)—a co-sponsor of Sanders' Medicare for All Act—similarly toldHuffPost in a Tuesday interview, "The visceral response from people across this country who feel cheated, ripped off, and threatened by the vile practices of their insurance companies should be a warning to everyone in the healthcare system."
"Violence is never the answer, but people can be pushed only so far," she continued. "This is a warning that if you push people hard enough, they lose faith in the ability of their government to make change, lose faith in the ability of the people who are providing the healthcare to make change, and start to take matters into their own hands in ways that will ultimately be a threat to everyone."
After facing some criticism for those comments, Warren added Wednesday: "Violence is never the answer. Period... I should have been much clearer that there is never a justification for murder."
Keep ReadingShow Less
Reports Target Israeli Army for 'Unprecedented Massacre' of Gaza Journalists
"In Gaza, the scale of the tragedy is incomprehensible," wrote Thibaut Bruttin, director general of Reporters Without Borders.
Dec 12, 2024
Reports released this week from two organizations that advocate for journalists underscore just how deadly Gaza has become for media workers.
Reporters Without Borders' (RSF) 2024 roundup, which was published Thursday, found that at least 54 journalists were killed on the job or in connection with their work this year, and 18 of them were killed by Israeli armed forces (16 in Palestine, and two in Lebanon).
The organization has also filed four complaints with the International Criminal Court "for war crimes committed by the Israeli army against journalists," according to the roundup, which includes stats from January 1 through December 1.
"In Gaza, the scale of the tragedy is incomprehensible," wrote Thibaut Bruttin, director general of RSF, in the introduction to the report. Since October 2023, 145 journalists have been killed in Gaza, "including at least 35 who were very likely targeted or killed while working."
Bruttin added that "many of these reporters were clearly identifiable as journalists and protected by this status, yet they were shot or killed in Israeli strikes that blatantly disregarded international law. This was compounded by a deliberate media blackout and a block on foreign journalists entering the strip."
When counting the number of journalists killed by the Israeli army since October 2023 in both Gaza and Lebanon, the tally comes to 155—"an unprecedented massacre," according to the roundup.
Multiple journalists were also killed in Pakistan, Bangladesh, Mexico, Sudan, Myanmar, Colombia, and Ukraine, according to the report, and hundreds more were detained and are now behind bars in countries including Israel, China, and Russia.
Meanwhile, in a statement released Thursday, the International Federation of Journalists (IFJ) announced that at least 139 Palestinian journalists and media workers have been killed since the war in Gaza began in 2023, and in a statement released Wednesday, IFJ announced that 104 journalists had perished worldwide this year (which includes deaths from January 1 through December 10). IFJ's number for all of 2024 appears to be higher than RSF because RSF is only counting deaths that occurred "on the job or in connection with their work."
IFJ lists out each of the slain journalists in its 139 count, which includes the journalist Hamza Al-Dahdouh, the son of Al Jazeera's Gaza bureau chief, Wael Al-Dahdouh, who was killed with journalist Mustafa Thuraya when Israeli forces targeted their car while they were in northern Rafah in January 2024.
Keep ReadingShow Less
Booze Hound! Lina Khan, Not Done Yet, Targets Nation's Largest Alcohol Seller
"The FTC is doing what our government should be doing: using every tool possible to make life better for everyday Americans," said one advocate.
Dec 12, 2024
The U.S. Federal Trade Commission on Thursday sued Southern Glazer's Wine and Spirits, alleging that the nation's largest alcohol distributor, "violated the Robinson-Patman Act, harming small, independent businesses by depriving them of access to discounts and rebates, and impeding their ability to compete against large national and regional chains."
The FTC said its complaint details how the Florida-based company "is engaged in anticompetitive and unlawful price discrimination" by "selling wine and spirits to small, independent 'mom-and-pop' businesses at prices that are drastically higher" than what it charges large chain retailers, "with dramatic price differences that provide insurmountable advantages that far exceed any real cost efficiencies for the same bottles of wine and spirits."
The suit comes as FTC Chair Lina Khan's battle against "corporate greed" is nearing its end, with U.S. President-elect Donald Trump announcing Tuesday that he plans to elevate Andrew Ferguson to lead the agency.
Emily Peterson-Cassin, director of corporate power at Demand Progress Education Fund, said Thursday that "instead of heeding bad-faith calls to disarm before the end of the year, the FTC is taking bold, needed action to fight back against monopoly power that's raising prices."
"By suing Southern Glazer under the Robinson-Patman Act, a law that has gone unenforced for decades, the FTC is doing what our government should be doing: using every tool possible to make life better for everyday Americans," she added.
According to the FTC:
Under the Robinson-Patman Act, it is generally illegal for sellers to engage in price discrimination that harms competition by charging higher prices to disfavored retailers that purchase similar goods. The FTC's case filed today seeks to ensure that businesses of all sizes compete on a level playing field with equivalent access to discounts and rebates, which means increased consumer choice and the ability to pass on lower prices to consumers shopping across independent retailers.
"When local businesses get squeezed because of unfair pricing practices that favor large chains, Americans see fewer choices and pay higher prices—and communities suffer," Khan said in a statement. "The law says that businesses of all sizes should be able to compete on a level playing field. Enforcers have ignored this mandate from Congress for decades, but the FTC's action today will help protect fair competition, lower prices, and restore the rule of law."
The FTC noted that, with roughly $26 billion in revenue from wine and spirits sales to retail customers last year, Southern is the 10th-largest privately held company in the United States. The agency said its lawsuit "seeks to obtain an injunction prohibiting further unlawful price discrimination by Southern against these small, independent businesses."
"When Southern's unlawful conduct is remedied, large corporate chains will face increased competition, which will safeguard continued choice which can create markets that lower prices for American consumers," FTC added.
Southern Glazer's published a statement calling the FTC lawsuit "misguided and legally flawed" and claiming it has not violated the Robinson-Patman Act.
"Operating in the highly competitive alcohol distribution business, we offer different levels of discounts based on the cost we incur to sell different quantities to customers and make all discount levels available to all eligible retailers, including chain stores and small businesses alike," the company said.
Peterson-Cassin noted that the new suit "follows a massive court victory for the FTC on Tuesday in which a federal judge blocked a $25 billion grocery mega-merger after the agency sued," a reference to the proposed Kroger-Albertsons deal.
"The FTC has plenty of fight left and so should all regulatory agencies," she added, alluding to the return of Trump, whose first administration saw
relentless attacks on federal regulations. "We applaud the FTC and Chair Lina Khan for not letting off the gas in the race to protect American consumers and we strongly encourage all federal regulators to do the same while there's still time left."
Keep ReadingShow Less
Most Popular