$9Bn – open a bottle of Bollinger please

Don’t worry it’s only $9Bn

Last week I noticed that Takeda, and Lilly had just been fined $9bn.

A US jury has fined Takeda and Eli Lilly $9 billion (£5.4 billion) for causing a man’s bladder cancer with their diabetes drug Actos (pioglitazone). The verdict came down hard on the companies after the case unearthed evidence that Japanese company Takeda had deleted emails, at least one of which raised concerns over Actos’ safety. ‘This serves as a wake-up call to those pharmaceutical companies that cut corners and hide or distort the facts rather than openly testing and educating about their drugs,’ Mark Lanier, who represented the plaintiffs, tells Chemistry World.

Takeda was unable to produce files for 46 clinical and sales employees, 38 of which were deleted after it ordered documents be preserved in 2002 ahead of legal action over Actos. ‘The breadth of Takeda leadership whose files have been lost, deleted or destroyed is, in and of itself, disturbing,’ wrote Judge Rebecca Doherty in a January ruling.  http://www.rsc.org/chemistryworld/2014/04/missing-emails-safety-risk-actos-takeda-eli-lilly-fine

I think that most industries would be somewhat shocked at a fine this big, and this truly was a whopper. However, it follows a pattern of massive fines. GSK was fined $3Bn in 2011 for suppressing clinical trial data on increased suicide risk in children, among many other activities, such as paying kickbacks to doctors. Pfizer was ordered to pay $2.3Bn in 2009 for a series of illegal activities, from mis-branding drugs, to bribery and corruption. AstraZeneca had to shell out $523 million in 2010 for illegally marketing Seroquel for use in children. Roche is accused of hiding data on Tamiflu, GSK is embroiled in corruption cases in China and elsewhere. Merck was hit with a $670 million fine over Medicare fraud in 2007. Eli Lilly shelled out $1.4Bn for illegal marketing in 2009…….etc.

These are vast fines, and the activities exposed are very disturbing indeed. Suppressing data on drugs causing cancer, or suicide, is very serious indeed. You would think these fines would be punitive, but clearly they are not. Or they wouldn’t keep happening. Perhaps the companies just see this as the price of doing business?

Say you have a drug that is making $5Bn a year in profit, and half of that profit comes from illegal marketing, or hiding data. It is not difficult to work out that after only five years, you have made an extra $12.5Bn in profit. I assume it takes at least five years for any case to come to court – probably far, far, longer. (Takeda, it seems, started suppressing data as far back as 1993)

I suppose the equation here is very simple, if dreadful. If you get fined a paltry £1Bn for hiding data, then you have made an extra $11.5Bn in profit from acting illegally. Even if you get fined $9Bn, you are still in the money. (Sales of pioglitzazone were very nearly £5Bn in 2010, so this is not an abstract discussion).

In short, if you do not possess a moral compass, and you are only interested in maximizing profit, it makes perfect sense to market your drugs illegally, pay bribes to doctors, suppress data on increased cancer risk – and all the rest of the corrupt and illegal activities that have been exposed in the courts. Why would you not? Any fine you have to pay is going to be smaller than the increased profit.

In my opinion the only real ‘why you would not‘ is if you, the CEO of Takeda, or Merck, or Pfizer can actually be sent to jail if it turns out that the company was acting illegally on thier watch. At present, the greater the profit, the greater the CEO bonus. Fines will usually arrive long after you have left the company, with a massive pay off, and a pat on the back for your great work in boosting shareholder value.

I think it would concentrate the mind if the CEO or Takeda, or Merck, or Pfizer knew that they would go to prison for a long time, if the company they run, or ran, is found guilty suppressing data. At present we are, effectively, rewarding corrupt behavior by pharmaceutical companies. Which is why there have been so many huge fines; and why I predict that there will be many more.

Currently, the situation is one of extreme moral hazard. A pharmaceutical company makes far more money acting illegally, than acting legally. If the activity is exposed, no-one goes to prison and no-one is personally bankrupted. All that is required is  to set aside enough money to pay the fine, if it ever arrives. ‘Don’t worry, dear shareholders, it’s only $9Bn.’ Phew, and I thought profits would be damaged.’

29 thoughts on “$9Bn – open a bottle of Bollinger please

  1. Alastair McLoughlin

    The tactics employed by drug comanies: “Who’s Paying Your Doctor?” Panorama, BBC1 8:30pm Monday 14th April.

  2. Leaf Eating Carnivore

    This moral hazard is so depressingly obvious, and so predictably repetitive.

    Anybody who thinks that white collar crime has only monetary repercussions has his or her head up in a very dark place. This sort of selfish and malignant uncaring maims, kills and destroys many, many lives every day. Specifically, yours and mine. It’s a societal cancer.

    “The buck stops here”? Which “here”? The CEO? Us? How about all of us?

    If we refuse to demand and implement hard legislation that genuinely and consistently holds (real) people personally responsible, and puts the malefactors in real boxes for hard time, then I can only conclude that we are giving permission to the psychopaths who scythe our lives. Thus do we collude with the thieves.

    At a very minimum, go vote. And ask the hard questions of the candidates.

    Responsibility should be a non-negotiable.

  3. chmeee

    Interestingly, under the Sarbanes Oxley bill, the CEO and CFO must personally sign and attest to the aaccuarcy of their final accounts each year. If they are subsequently found to be false / misleading, they ccan be sent to prison for a long time. Those of us who have anything to do with computer systems in any way connected with financial data in U.S companies regularly curse said bill.

    However, one wonders if itmight also be applied to drug companies who falsify studies, given the effect this willhave on their accounts? Scope for anenterprising lawyer, of which there are more than a few in the U.S,, methinks…..


  4. Jean Humphreys

    Never mind prison – instead of a fine, the heads of companies should be compelled to take their own medicine, whether or not they have any need of medication.
    “They say it is safe – show us.”

    1. celia

      There must be a route somewhere that could send those responsible to prison. Murder, manslaughter, fraud etc. etc. Fines certainly are not the answer. What is the sentence for causing death by dangerous driving ? Surely this is knowingly causing death or disability for personal gain.

  5. dearieme

    Companies are only legal abstractions – it’s people who make decisions and take actions. Jail for CEOs might be part of the answer.

  6. Stefan

    The other sad part is that the 9bn most likely will be reduced substantially in the inevitable appeal. Punitive damages way above actual damages will be the argument. So the profit calculation looks even better. Never mind those pesky legal fees…

  7. elainespinningaround

    So much for evidenced based medicine!! Is anything safe when such huge profits are involved. The NHS is being bankrupted by such huge pharma bills and how many of them make people better, probably make them worse so they have to take more.

  8. mikecawdery

    Possibly more important is the fact the MHRA and EMA never charge Big Pharma companies for malpractice, false documentation, false claims or any other criminal offence

  9. GG

    All of this has huge implications for the medical profession as well as patients. Trust is fundamental to the relationship between doctor and patient. Without it patients do not believe what they are told about diagnoses or treatment. Without it doctors cannot help patients because patients do not trust them. Without it doctors and patients end up not being to work together because they are too suspicious of each other’s motives.

    Currently patients are losing out big time. If it is not the government wanting to steal all their data and treat them like repositories of data rather than human beings (care data), it is big pharma bribing doctors to prescribe medicines that are not needed, that do not do what is claimed or are risky for the patient.

    Doctors should not be pushed around and bribed by big pharma but neither should they succumb to big pharma (I suspect a lot easier said than done). Where doctors have succumbed to big pharma and prescribed medication as a result then the whole question of the oath they took to ‘do no harm’ arises. How can a doctor ‘do no harm’ if he/she prescribes medication that harms the patient and these effects are known? A drug that causes cancer being used to prevent it seems ludicrous but apparently this is what patients are given. Why? Patients need to be given the facts about drugs they are offered and keeping data secret in order to sell more and more drugs is totally unacceptable. Patients need to demand more information and stop just taking any old drug they are prescribed. They need to ask more questions and especially about WHY their doctor is prescribing these specific drugs.

    Too much money can influence how people behave and drug company CEOs and everyone else on the Board, shareholders and others are putting money way before patients. In today’s world it is a risky business being a patient. Surely hitting these drug companies where it hurts is much more likely to get a result. Remove their licence for a drug if unethical promotion, bribery and other bad practices are involved in their profiteering. Make them personally responsible for causing harm to patients where risks were known but covered up either to the medical professionals being encouraged to prescribe the drugs and/or to the patients who are given them with the full facts and risks being given. On top of this the CEOs must be responsible for the practices of their companies and if convicted of such practices then he/she must not be allowed to work in the pharmaceutical industry again.

    Patients are probably at more risk now from the medical profession because of big pharma than they have been before. It doesn’t need to be like this. We need to build up trust again between patients and their doctors if we want to make progress.

    1. mikecawdery

      I agree entirely – trust is essential. I suspect that the “bedside manner” is probably as effective as a placebo which has been shown to have a potential beneficial effect up to 40%. One study showed a beneficial effect even when patients knew it to be a placebo.

      I would also draw attention to the fact that many modern drugs merely ameliorate, alleviate or reduce signs and symptoms; they do not cure but rely on a captive consumer patient taking drugs for life. Many examples

      1. vjadams2014

        This is so true. A retired consultant anaesthetist recently said to me that he found it shocking that people continued to be prescribed medication that statistically had so little positive impact, and even more shocking that such a high proportion of hospital admissions of the elderly result from their medication. It seems that many doctors are aware of this, yet few have the courage to do as Malcolm does and challenge the system

    2. celia

      GG, I agree with all you say. My only reservation is regarding “On top of this the CEOs must be responsible for the practices of their companies and if convicted then he/she must not be allowed to work in the pharmaceutical industry again”. I don’t think this is tough enough. They could still get a golden handshake and move on to become CEO of a bank or another type of company.

      They need to have a criminal conviction and to be unable to hold a top position in any company, and absolutely get no golden handshake.

  10. V

    Irresponsibility is unfortunately rife at all levels of our societies, especially where one would expect most responsibility: health and food, finances, defense, environment – you name it, it’s there. And yes, it starts with the little guy, with you and me.
    WE need to change, THEN change the status quo, but I’m far from sure that we can.

  11. GG

    As well as the influences of GSK and others we must also realise that the government is doing the same in a slightly different way – Quality Outcome Framework (QOF) points are defining and driving the care offered by GPs and the conditions they pay most attention to. GPs are obliged to do what the government wants them to do if they want to get their funding points. This is wrong on so many levels. I want a doctor who is not preoccupied wondering how I can be fitted into the tick box system whilst I am trying to explain why I am there. Doctors should be able to make their independent clinical judgement with no pressure from the government to put patients into a variety of pre-determined pigeon holes.

    1. S Jones

      I couldn’t agree more. Diagnosing people with depression is very lucrative for doctors thanks to the QOF points they get. I think this has led many people with physical complaints to be told they have depression, rather than have their ailments actually diagnosed properly by doctors who want to practice medicine.

      The thing that puzzles me about this is what the government gets out of setting such a high value on doctors diagnosing depression in the first place. Is it because a depressed person is assumed to be capable of working, but someone with a physical complaint might not be, and also they might need more expensive treatment?

      1. gilbert78

        Yet another explanation is possibly that the Government would rather treat people with pills than have them in hospital for heart surgery etc … no doubt they have been convinced by Big Pharma that the drugs work and it is much cheaper for the NHS. That argument is possible only because the full research data is tightly withheld.
        There is a gathering tide of realisation of how the whole pharma’ system works which is gathering momentum in the Media, the press now see it as a story that will ‘run’ , the FT magazine had an article in December highlighting the experience of a whistle blower; and there was the Panorama program on TV last night covering just how much medics make by being associated with drug companies.
        We all need to pressurise our constituency MP’s and get them to bombard the Health minister with all this factual information that is coming to light PLUS the side affects that you may personally have experienced.
        They will eventually listen and act.

      2. Helen

        I think diagnosing patients with depression has always been a useful way for lazier doctors to fob off patients with difficult to diagnose or difficult to manage physical conditions. However, I didn’t realise that a diagnosis of depression was also lucrative in terms of QOF. Also, I think you’re bang on the money (ha ha) with your point about work capability.

  12. Jeff Cable

    Sadly, medicine appears to be overly concerned with expedience. Tests, numbers and drugs are the order of the day. There was a time when clinicians used to listen to the patient’s history, examine them based upon the history and then arrive at a working diagnosis. Now… blanket polypharma for non-existent threats is a more likely MO for clinicians. Whether it is driven by QOF payments, bribery, greed or too much work, it is hard to say. What is certain is that GPs have become embroiled in the question which patients are now asking themselves… “what good am I doing by seeing the doctor”.

    With our supervisory bodies (such as NICE) in the pockets of the pharmaceutical industry, we patients are unlikely to get anything resembling a fair crack of the whip. It was the New England Journal of Medicine in the April 26th 2007 issue which had reported that of 3167 medics who were surveyed, that 94% were reported to have some type of relationship with the pharmaceutical industry.


    Clearly, this is where things are going wrong. The industry exists to sell pharmaceuticals and make a profit. It does not exists to find a cure for anything. In fact, it can be seen that it is in the interests of the pharmaceutical industry to make expensive medications that keep patients ticking along… requiring them for life. Once we have died, there will be many more patients to both make and keep unwell and the whole sordid cycle repeats itself.

    While clinicians are held in thrall to medicine products that supposedly fix people, while remaining uncritical of the nefarious deeds of pharmaceutical companies who hide vital data, inflate claims for their medicines, publish false medical journals and generally behave with criminal abandon, the situation will not improve. I no longer trust medics to deliver appropriate care and I suggest that we will live longer, much healthier lives if we ignore the medical profession and the scare stories about critical life-threatening conditions, which are put out with regular monotony by rapacious drug companies and researchers who are not especially careful to conduct their researches scientifically or with sufficient rigour.

    It is a very sad state of affairs when we can no longer trust those whom we charge with assisting us to regain our health, because the impetus to do so is subsumed by greed. Malcolm, without many more clinicians such as yourself, who are prepared to deal honestly with patients and who are unprepared to compromised their own integrity, the power remains with NICE, Big Pharma and an unbelievably supine medical profession.

    1. mikecawdery

      Many thanks for that reference. It clearly adds weight to the contentions of such authors as Drs Marcia Angell, Goldacre et al.
      The following reference may be of interest:
      Duijnhoven RG, Straus SMJM, Raine JM, de Boer A, Hoes AW, et al. (2013) Number of Patients Studied Prior to Approval of New Medicines: A Database
      Analysis. PLoS Med 10(3): e1001407. doi:10.1371/journal.pmed.1001407

      As many, if not most modern drugs merely ameliorate, alleviate or reduce signs and symptoms, they have to be taken for life (they do not CURE in the sense that antibiotics cure) so that this paper is very relevant. Its conclusion was
      Conclusions: For medicines intended for chronic use, the number of patients studied before marketing is insufficient to
      evaluate safety and long-term efficacy. Both safety and efficacy require continued study after approval. New epidemiologic
      tools and legislative actions necessitate a review of the requirements for the number of patients studied prior to approval,
      particularly for chronic use, and adequate use of post-marketing studies.

      1. Dr. Malcolm Kendrick Post author

        I shall definitely read this. I find it ridiculous that you can launch a drug to be taken by millions of people, for life, without ensuring long-term safety studies are done. A study on smoking that lasted five years would not show any increase in the risk of lung cancer.

        1. mikecawdery

          Thank you for your comment. I find myself as an 80+ bl***y research vet wondering how obvious associations are continually ignored and hidden (as the NHBLI and CDC epidemic of CHF in the US were removed and have now been removed from Thinkquest); why the study:
          Dement Geriatr Cogn Disord 2009;28:75–80 DOI:10.1159/000231980
          can be published without treatment details; why studies like Seneff’s (Eur J Intern Med. 2011 Apr;22(2):134-40.) was first rejected as it contained a statin section and so on and on.

          It seems that the only way to publish negative statin data is to publish a well referenced book; the medical journals simply reject most negative studies to their everlasting discredit

  13. Robin J Willcourt MD

    Effects of Statins on Incident Dementia in Patients with Type 2 DM: A Population-Based Retrospective Cohort Study in Taiwan
    Jui-Ming Chen, Cheng-Wei Chang, Tzu-Hao Chang, Chi-Chang Hsu, Jorng-Tzong Horng Wayne H-H Sheu


    Headlines here in OZ have been about how Statins reduce Alzheimers. Looking at the absolute risk, EVEN though the numbers in each group are poorly matched, AND the study is observational AND it has these caveats stated by the authors: “There are some important limitations in our study. Our administrative claims data set did not provide relevant clinical details about status of glycemic and blood pressure control, co-medication use, other potential risk factors for dementia such as apolipoprotein E4 genotype, education, diet, smoking, and alcohol use. In addition, our claims data followed up for 8 years, which might be insufficiently long for development of dementia. In addition, patients may have received medications from sources that are not captured by pharmacy claims” the reduction appears to be from about 0.05% to 0.025% across the three groups on statins.

    Can anyone tell me if I am mistaken?
    If not, how can this happen? Then, I would love to know what COI there might be and the “paper” should then be called Kleenex instead.

    1. mikecawdery

      I concur with your disbelief!

      Dement Geriatr Cogn Disord 2009;28:75–80 DOI: 10.1159/000231980

      This paper can be down loaded in full. In Tables 2-4 replace cholesterol (TC) levels with US treatment guidelines for these TC levels. It does not change the numbers or stats but it certainly changes the interpretation.
      The authors note that treatment details were NOT AVAILABLE.
      What medical insurance company fails to follow official guidelines?
      What medical insurance company fails to keep full therapeutic details?
      Why were treatment details not available?

    2. David Bailey

      Statins seem to have featured in a number of favourable headlines recently:

      1) They are supposed to increase blood flow to the penis!

      2) They are supposed to be good for prostate cancer.

      3) The above study indicating they are good for dementia.

      To me this all seems a bit rich, since statins are being prescribed to lower the concentration of a compound that it would seem is barely correlated with heart disease and stroke, and they have clear and obvious side effects!

      Could it be that these studies are being promoted in the hope that they stem the rising tide of people complaining about the side effects of statins – which include confusion and memory loss – which to a non-medic like me sounds uncomfortably close to dementia!

      I hope Dr Kendrick will comment on these stories.

  14. Spokes

    I was wondering about ‘studies’ like this one, since they seem very at odds with what you’d expect given what statins are said to do biochemically. I just can’t square the claim that statins reduce alzheimer’s risk with the side effects statins have. Perhaps if you get ALA, rabdo or liver problems, you don’t always get to express your neurological problems. Bad study, seems to be a reasonable explanation.


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