Big pharma: prosecutions for discounting, bribery and ‘education’

28 Dec

Today, Euronews reports from Croatia that pharmaceutical company Farmal, and 364 individuals, have been charged with bribery and abuse of office. Farmal allegedly ran a network of doctors, giving them gifts in return for prescribing the company’s products

Only two days ago Andrew Jack reported that US fines from whistleblower and government prosecutions against the pharmaceutical industry reached $20bn in the period 1991-2010. In less than three years since then, companies have been given further penalties totalling more than $13bn.

pharma pays chart

Jack cited four examples:

  • Last year, Eli Lilly paid $29m to the US Securities and Exchange Commission after evidence showing it offered discounts to fund bribes to win business in Brazil and Kazakhstan.
  • Pfizer was fined $60m for activities including “incentive trips” to Greece for Bulgarian doctors who agreed to meet prescription targets for its drugs.
  • Johnson & Johnson  channelled more than $100,000 through a subsidiary company to a sympathetic nurse in order to boost prescriptions of Natrecor, a heart medicine; she spoke favourably about the drug in talks, trained colleagues in its use and put her name on an article in a medical journal to boost sales. J&J paid a $2.2bn fine in November for practices stretching back over a decade – the latest in an escalating series of penalties against the pharmaceutical industry for the way it markets its products.

He points out that the marketing process begins before new drugs are approved by regulators. There has been growing concern in recent years that articles in influential medical journals describing experimental products, assessed by reviewers and editors, are excessively favourable to new drugs. On occasion there has been selective design and presentation of the evidence and publication of ‘flattering’ safety data.

Building relationships with prescribers

  • Sales representatives make presentations to doctors; a study last summer showed that, on average, US doctors who received payments from companies were twice as likely as their peers to prescribe their products.
  • Money is spent on bringing doctors to conferences for “continuing medical education”, often in luxury international hotels. GSK last year settled a record $3bn fine in the US for paying prescribers to attend conferences in luxury resorts in Hawaii.
  • “Key opinion leaders” among physicians are paid as consultants to give speeches and presentations to their peers. They often sit on professional bodies that draft treatment guidelines. They may also be paid to advise on and recruit patients into lightly regulated “post-marketing” trials for drugs that are already approved.
  • Companies have also offered doctors discounts or donations of their medicines to wean them off rival products.

Examples of improved practice

US and European regulators are pushing for greater publication of clinical trial data, opening the possibility of third-party analysis of drug safety and efficacy.

Doctors and healthcare systems are being advised to pay for continuing medical education, reducing the influence of industry funding.

Some universities and hospitals already ban visits by sales representatives or consulting payments to doctors.

AstraZeneca no longer pays for physicians to attend international medical conferences. GSK last week announced similar moves, as well as plans to sever any bonuses to its marketing staff linked to individual sales targets. It wants them to be judged by the quality of medical advice they provide doctors rather than the crude volume of prescriptions.

“Health technology assessment”, the use of third-party review of the evidence of the value of treatments to guide doctors’ prescribing habits is being undertaken by the National Institute for Health and Care Excellence (NICE) in the UK; the transparency commission in France and Amnog in Germany already conduct such assessments of new medicines.

Legal advice: “Over 12 months after the UK Bribery Act was introduced, and with increasing enforcement in the pharmaceutical and medical business sectors, pharmaceutical companies should ensure that their compliance programmes are in place and updated to reflect developments over the last 12 months”.

Whistleblowers in the Orphan Medical/Jazz Pharmaceuticals settlement and cases that were part of the settlements by Amgen, Glaxo and Pfizer:



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