In the largest settlement involving a pharmaceutical company, the U.S. Justice Department announced on July 2 that GlaxoSmithKline LLC will pay $3 billion in fines and plead guilty to marketing drugs for unapproved uses and failing to report drug safety information to the U.S. Food and Drug Administration (FDA).
The criminal charges involved the illegal marketing of the antidepressants Paxil and Wellbutrin and the withholding of data on the health risks of the diabetes medication Avandia. For these charges, Glaxo will pay a criminal fine of $1 billion. The other $2 billion will go toward fines for a civil settlement involving the sales and marketing of several of the company’s other drugs, including the asthma drug Advair. Glaxo did not admit to any wrongdoing in the civil case.
The company had already set aside $3 billion in cash in November, when the terms of the settlements were initially announced. The sum sounds large, but it is only a portion of the drug maker’s profits from the drugs involved. The Wall Street Journal reports that prosecutors are unsure how much Glaxo made specifically from marketing its drugs for unapproved uses — an illegal practice known as off-label marketing — but it’s possible that its profits exceeded the $3 billion fees. The New York Times reports also that the fines represent a fraction of what Glaxo made from the drugs overall:
Avandia, for example, racked up $10.4 billion in sales, Paxil brought in $11.6 billion, and Wellbutrin sales were $5.9 billion during the years covered by the settlement, according to IMS Health, a data group that consults for drugmakers.
“So a $3 billion settlement for half a dozen drugs over 10 years can be rationalized as the cost of doing business,” [Patrick Burns, spokesman for the whistle-blower advocacy group Taxpayers Against Fraud] said.
The settlement covers improper Glaxo practices from the late-1990s to mid-2000s. Based on claims by whistle blowers — four Glaxo employees — prosecutors said the company tried to get doctors to prescribe drugs off-label by buying them spa treatments and lavish trips, and in the case of Paxil, helping to publish a paper in a medical journal that misreported clinical trial data.
Here’s how the company broke the law:
Although the antidepressant Paxil is not approved for patients under 18, Glaxo illegally marketed the drug for use in children and teens, offering kickbacks to doctors and sales representatives to push the drug.
A government probe was launched in 2002, and it was discovered that Paxil, as well as several other antidepressants, were no more effective than placebo in treating depression in kids. Indeed, between 1994 and 2001, Glaxo conducted three clinical trails of Paxil’s safety and efficacy in treating depression in patients under 18, and all three studies failed to pass muster.
One clinical trial, known as Study 329, found that teens who took the drug for depression were more likely to attempt suicide attempt than those receiving placebo pills. Glaxo hired a company to prepare a medical journal article that downplayed Paxil’s safety risks, including increased risk of suicide, and misrepresented data to trump up the positive results of the study. The article was published in 2001, falsely reporting that Paxil was an effective treatment for child depression.
Prosecutors accused Glaxo sales representatives of then using the article to promote the use of the drug for depressed youth. Sales reps invited prescribing psychiatrists to luxury resorts for “Paxil forum meetings” where they were treated to fancy dinners and free entertainment like sailing trips and balloon rides.
Reports of teens committing suicide while taking Paxil began surfacing in 2003, and the FDA discovered that 10 of the 93 Paxil patients in Study 329 had attempted suicide or thought about it, versus one out of the 87 patients on placebo. In 2004, the FDA added a black-box warning on the drug’s label about the increased risk of suicidal thoughts in teens who take it.
Glaxo used the help of PR firms and the appeal of lavish vacations to convince medical professionals to prescribe the antidepressant Wellbutrin for weight loss, sexual dysfunction, drug addiction and ADHD, even though the drug is FDA approved only to treat depression. Tavy Deming, an attorney for one of the whistle blowers, told the AP that during a regional meeting of sales representatives in Las Vegas in 2000, the reps were told to promote Wellbutrin as the drug that makes patients “happy, horny and skinny,” as part of a national slogan repeated to doctors.
Among several physicians accused of taking payments from Glaxo to push Wellbutrin is celebrity doctor Drew Pinsky, who was named in court documents for accepting $275,000 for “services for Wellbutrin.” Pinsky allegedly took the money in two payments in 1999 for “extolling the virtues of the antidepressant ‘in settings where it did not appear that [he] was speaking for GSK,’ according to the Justice Department,” the New York Daily News reports.
Company employees who successfully included unapproved uses of Wellbutrin in their pitches got bonuses. Employees who had a problem with giving doctors kickbacks to prescribe Wellbutrin improperly were put on leave, prosecutors said.
For seven years, Glaxo failed to report data to the FDA showing that its blockbuster diabetes drug, Avandia — approved in 1999 — increased heart risks in patients. In 2007, Dr. Steven Nissen, a Cleveland Clinic cardiologist and a longtime critic of Avandia, published an analysis in the New England Journal of Medicine that showed that the drug increased the risk of heart attack by more than 40% in people with Type 2 diabetes. It was early public evidence that the Glaxo-sponsored data on which the government based its safety review for approval were flawed and minimized the heart risks to diabetes patients.
Nissen’s study used the drug maker’s own data, from trials that had been conducted but never reported. By the time Nissen’s study came out, the drug was a bonafide blockbuster, earning billions of dollars and being taken by millions of patients. The heart risks were by this time becoming clearer, and Glaxo reviewed the data in 2005 and 2006; internal analyses showed 29% and 31% increases in heart risks in Type 2 diabetes patients. In 2006, Glaxo reported the data to the FDA — but it was only a portion of the data Glaxo had, from 15 tests of Avandia before the end of 2006; the agency didn’t make the information public immediately either, instead asking one of its own statisticians to review the findings. The public remained largely uninformed, and Glaxo continued to promote the drug’s benefits while its sales reps denied the heart risks.
Then, as part of a settlement with New York over Glaxo’s failure to disclose the suicide risks of its antidepressant drug Paxil (see above), the company agreed to put all of its recent clinical trials on its website. Nissen downloaded the available data on Avandia — 42 trials — wrote up his paper and in May 2007 sent it the New England Journal.
In 2007, the drug was banned in Europe. The European Medicines Agency concluded that the heart risks of Avandia did not justify its blood sugar benefits, and since alternatives were available, there was no need to prescribe it. In 2010, an FDA advisory panel voted on whether to pull the drug from the U.S. market. Ultimately, the agency decided to allow continued sales of Avandia, but severely restricted its use: to prescribe the drug, doctors must now be certified to do so, and they may give it only to patients who have been treated safely with it before, have been made aware of the risks of the drug and have failed to control their blood sugar with other medications.
Dr. Nissen described the FDA’s move as “a decade-long nightmare coming to an end.”
However, Glaxo says the civil settlement is not an does not admission of any liability or wrongdoing in the selling and marketing of Avandia and they dispute some of the claims.