The British drug behemoth GlaxoSmithKline - - (Advair to Avandia to Aquafresh, and straight through the alphabet to hundreds of brand names: Beano to Horlicks to Polident to Zantac) - - is about to nip multiple civil and criminal investigations in the bud writing a check:
Federal prosecutors began an investigation in Colorado in 2004, later taken over by the U.S. attorney in Massachusetts, into whether Glaxo promoted drugs for unapproved uses, and into ways Glaxo potentially influenced doctors. The probe concerns nine of the company’s best-selling products from 1997 to 2004, including the Advair lung treatment, Glaxo said in its annual report.And though the Glaxo payment is a record-breaker for pharmaceutical firms, the company will wrap up these pending probes with a surplus in reserves it had set aside just for these matters.
Today’s settlement also covers a U.S. Justice Department probe of Glaxo and a Medicaid rebate program, and a Justice Department investigation into the development and marketing of the Avandia diabetes drug, the company said.
Is it right that the company buys its way out of trouble and has a windfall to spend?
The company set aside 2.2 billion pounds ($3.5 billion) in the fourth quarter last year in anticipation of reaching an agreement on the cases. Glaxo said it will have about 1 billion pounds of its 2.9 billion pounds in total legal provisions remaining after today’s settlement is completed, and it hasn’t decided what to do with the moneyLook at the other troubles it is still facing and ask yourself if anything that money alone should not be allowed to fix?
Glaxo still faces probes involving the United Nations oil- for-food program, and HIV product sales and marketing in the U.S...This enormous double standard in liabilities and consequences that benefits big corporations - - with the costs ultimately borne by customers and consumers - - reminded me of the recent disparity between an announced CitiBank civil settlement involving mortgage investment fraud and criminal charges brought in Wisconsin against lower-level mortgage scam artists.
When the Occupy Wall Street Movement looks for other targets, boycotts of Big Pharma should be right up there.