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Glaxo Settles Fraud Suit for $750 million

Glaxo Settles Fraud Suit for $750 million

Pharmaceutical giant GlaxoSmithKline agreed to pay $750 million to settle criminal and civil complaints that for years the company knowingly sold contaminated baby ointment and other products.  The settlement comes as a result of a whistleblower suit, placing it in line with a growing number of such cases.  But this settlement represents the highest whistleblower award yet in a health care fraud case.

Cheryl Eckard, quality manager for the company, claimed she warned Glaxo of the problems with Avandia, Bactroban, Coreg, Paxil and Tagament.  But rather than address her concerns and work toward making those products safe, they fired her.  The problems all apparently stem from the manufacturing process plant located in Puerto Rico.

The settlement was announced by both the Department of Justice’s Civil Division and the United States attorney for Massachusetts.  Their coordinated prosecution alleged the drug maker misled patients and defrauded federal and state governments that through Medicare and Medicaid, pay for much of health care.

Boiled down, the private industry that so many on the right insist will properly manage health care just effectively admitted to ripping of Americans and simultaneously selling them contaminated products.  And it was the government that stepped in and forced the abuse to light.  Making these kinds of protections less available to the American public is part and parcel of the Republican platform and for some reason people buy it.

It would be more understandable if the suits could be criticized as political creatures, but the allegations come from industry insiders–researchers and quality control professionals who knew what their companies were doing was wrong.  And they affect drugs with proven problems and histories of being pushed through the approval process–drugs like Avandia for example.

Government is not good at everything, but at its most basic level, it is very good at providing for the health, safety and well-being of its constituents.  As this latest settlement shows, the inherent perversity in having a health-care industry profit off illness is the perfect breeding ground for greed, fraud and corruption.  Let’s remember that as we hear the growing chants to repeal health care reform.

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photo courtesy of Pink Sherbert Photography via Flickr

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47 comments

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1:40AM PDT on Nov 2, 2010

This is no different than those other big corporations who want to ship jobs overseas and still charge an arm and a leg to those who are now jobless from being downsized...

It's a game of lets sweep the problem under the carpet by those who blow the whistle, and then still get the FDA to back the meds, even if it's dangerous.

5:37AM PDT on Nov 1, 2010

Not cool... Espacially because I buy a lot of products from them. Big companies are everywhere, WE are surronded my friends!

2:45PM PDT on Oct 31, 2010

This settlement is long overdue, after so many thousands of people have suffered thanks to this so-called 'medicine'. Another one to stay away from is Effexor, which has a list of side effects as long as your arm and is addictive. When the FDA was forced to open up its test results on this drug a few years ago, the data showed adverse reactions in more than half the test subjects. Yet they still passed it for use in the marketplace. No surprise there—pharma execs routinely go from their job at the corporation to the FDA regulatory agency. The FDA—and Health Canada—have become little more than rubber stamp agencies for drug companies. Do yourself a favour and find a natural alternative.

7:58AM PDT on Oct 30, 2010

Unfortunately some want less government often referred to as 'Laissez-faire government'. Just imagine the runaway chaos if pharmaceutical and other corporations such as big oil, Monsanto, etc. etc. were left to do as they pleased with no intervention and no accountability, even get 'manipulated legislation' passed that exempts and/or gives Corporations the same privacy as individuals so that the public do not know what is happening behind their closed doors. 'Big money' has the power to win over entire elections and failing that, then to ply or bribe elected senators . . . to vote on 'disguised legislation' that allows corporations the freedom to do so. It is the Corporations that benefit from 'Laissez-faire' government.

2:06PM PDT on Oct 28, 2010

Noted and signed!!

9:46AM PDT on Oct 28, 2010

We need public health care so that we can take the profit out of these corporate pharma-terrorist.

10:53PM PDT on Oct 27, 2010

I look around my small community, and see so much waste of human life and potential, just because companies like these exist throughout the 'health" care industry. And industry is what it is. It's not really about healing - it's about money, as we all know. It's just sickening to watch.

9:02PM PDT on Oct 27, 2010

noted

6:36PM PDT on Oct 27, 2010

Yes it is time to take of your own body, nobody knows what it needs better then you do, The first thing to do is have some faith in it, and give it TIME to heal. Oh Yes, and eat smart.....

3:27PM PDT on Oct 27, 2010

This will keep hanppening as long as there are only fines. What needs to happen is decision makers get arrested, tried and if convicted jail time. The only way things will improve in all businesses.

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