Pharmaceutical companies are often at odds with the Food & Drug Administration (FDA). It’s become common practice for big pharma to buck compliance with FDA guidelines and then fork over some cash to pay penalty fines.
Are pharmaceutical companies really trying to follow pharma guidelines, or is it easier for them to just do what they want and consider fines as the cost of doing business?
Here are some of history’s biggest fines in big pharma.
Pfizer: $1.3 billion criminal + $1 billion civil (2009)
In 2009, Pfizer pled guilty to a felony violation of FDA pharma guidelines with “intent to defraud or mislead.” Pfizer was charged with marketing four drugs, including anti-epileptic drug Lyrica, for off-label uses which hadn’t been approved by the FDA. Pfizer also agreed not to challenge allegations that it paid kickbacks to doctors to get them to prescribe Pfizer-brand drugs to patients.
Pfizer’s annual net income for the last 10 years has averaged $11.7 billion, so the company hasn’t taken too much of a financial hit. In 2009, the year it was fined, Pfizer reported profits of $8.6 billion.
GlaxoSmithKline Nets Largest Civil Fine (2010 & 2012)
GlaxoSmithKline (GSK) has been busy. In 2010 and 2012, GSK managed to rack up a combined total of $3.8 billion in criminal fines and civil settlements with the US Department of Justice (DOJ). The list of pharma guidelines that were violated is staggering:
- Off-label promotion
- Failure to disclose safety data
- Paying kickbacks to physicians
- Reporting false best prices
- Poor manufacturing practices
- Making false and misleading statements concerning drug safety
- Underpaying rebates owed under the Medicaid Drug Rebate Program
As the maker of well-known drugs like Wellbutrin, Paxil, and Valtrex, GSK’s rolling average net profit per month over the last 10 years was £5 billion ($7.1 billion). In the two years GSK was fined, the company made a combined total of £6.1 billion ($8.6 billion).
Johnson & Johnson: $485 billion criminal + $1.72 billion in civil (2013)
Like Pfizer, Johnson & Johnson’s total of $2.2 billion in fines failed to adhere to pharma guidelines and paid big for a combination of fraudulent marketing of off-label drug uses and kickbacks to health providers to incentivize them to prescribe Johnson & Johnson drugs.
Over the last 10 years, Johnson & Johnson’s average net income was $12.5 billion. The year the company was fined, Johnson & Johnson reported $13.8 billion in profits.
To read more about big pharma’s bad behavior, read our coverage of inflated prescription drug prices.
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