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Thursday, December 30, 2010

Pharmaceutical industry rips off government more than the military

The drug industry has surpassed the defense industry to become the biggest defrauder of the federal government, as determined by payments it has made for violations of the False Claims Act (FCA), according to a new Public Citizen study released in mid-December.

The Pentagon used to be the leading recipient of private-sector fraudulent deals, but the mantle has been passed now to the Department of Health and Human Services. GlaxoSmithKline, Pfizer, Eli Lilly and Schering-Plough were the largest offenders.

According to the study, the practice of illegal off-label promotion of pharmaceuticals has been responsible for the largest amount of financial penalties levied by the federal government over the past 20 years. Deliberately overcharging state health programs, mainly Medicaid fraud, has been the most common violation against state governments and is responsible for the largest amount of financial penalties levied by these governments.

“Desperate to maintain their high margin of profit in the face of a dwindling number of important new drugs, these figures show that the industry has engaged in such activities as dangerous, illegal promotion for unapproved uses of drugs and deliberately overcharging vital government health programs, such as Medicare and Medicaid,” said Dr. Sidney Wolfe. He compiled and analyzed the data with physicians from the Johns Hopkins General Preventive Medicine program, Drs. Sammy Almashat and Charles Preston, as well as Columbia University public health student Timothy Waterman, all of whom worked at Public Citizen.

In some of cases, companies denied illegal activity such as fraud and kickbacks while making major payments to settle investigations, and the government agreed to settlements rather than pursue the cases further.

“The danger to public safety and loss of state and federal dollars that comes with these violations require a more robust response,” Wolfe said.

Dr. Grout’s comment:

Dr. Wolfe hit the nail on the head. Expect to see more fraud, since nobody is going to prison and the companies settle without any admittance of guilt. Furthermore, the companies have deep pockets and they fund an army of Washington DC lobbyists who write large campaign checks. The couple hundred dollars that you and I might give to a candidate barely registers. Add to that, ubiquitous TV advertising that makes people think it is normal to take a daily array of drugs.

There is so much prescription drug use now that excreted dosages show up in our drinking water – people who have never taken a hypertensive drug, for example, can test positive for it.

And there is related news – the December 28th Wall Street Journal ran an article, “So Young and So Many Pills.” It says more than 25% of kids and teens in the U.S. take prescription drugs on a regular basis. The biggest sellers: asthma meds, ADHD meds, antidepressants, antipsychotics, antihypertensives, sleep aids, non-insulin diabetes, and statins.

The FDA rewards drug companies for testing medications in children. “In more than a third of these studies,” the WSJ reporter tells us, “there have been surprising side effects … Long-term effects of drugs in kids are almost never known since pediatric studies, like those in adults, tend to be relatively short.”

The article quotes a doctor in Arkansas who says obesity is the number one problem he sees in kids, yet only about 10 percent of the parents follow his recommendations for exercise and a change in diet. The addictive nature of today’s processed food makes it almost as hard to change our eating habits as it is to quit smoking.

For kids on the brain altering drugs and statins, there are safer answers that also give better results long-term. We’ve seen kids with ADHD and brain disorders make incredible strides with the drug-free BrainAdvantage program.

For the first time in two centuries, the current generation of children in America may have shorter life expectancies than their parents. Making kids pop handfuls of pills each week and suffer their side effects will not change this picture for the better. What can you do? Learn. Look behind the marketing messages and the effects of industry’s heavy-handed lobbying and understand how to protect yourself. For starters, read the book, An Alphabet of Good Health. Engage in the blog conversation.


  1. So it does happen that pharma is not only responsible if the medicine is ineffective. Even BFA must be responsible also because they are the one who evealuate the medicines that produced by Pharma comapanies.

  2. This is the time to earn money, invest in oil and make safe money!