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« The Midmorning Refill: House’s new banking chair says he’s there to ‘serve the banks’
Democracy Now! discusses Public Citizen report on pharmaceutical industry fraud »

When it comes to cheating the government, Big Pharma tops the defense industry

December 16, 2010 by Joe Newman

Defense contractors,who may never live down their reputation of overcharging the government (remember the $640 toilet seats?), can now offer up that there is a worse industry when it comes to cheating the government. A Public Citizen report released today found that the pharmaceutical industry has now become the biggest defrauder of the federal government.

The study found that pharmaceutical cases accounted for at least 25 percent of all federal Federal Claims Act violation payouts over the past decade, compared with 11 percent by the defense industry.

The fraud results were a key finding from a Public Citizen analysis of all major pharmaceutical company civil and criminal settlements on the state and federal levels since 1991 and found that the frequency with which the pharmaceutical industry has allegedly violated federal and state laws has increased at an alarming rate. Of the 165 pharmaceutical industry settlements comprising $19.8 billion in penalties during the past 20 years, 73 percent of the settlements (121) and 75 percent of the dollar amount ($14.8 billion) have occurred during the past five years.

Many of the infractions, and the single largest category of financial penalties, stemmed from the practice of off-label promotion of pharmaceuticals – the illegal promotion of a drug for uses not approved by the Food and Drug Administration (FDA). Off-label promotion can be prosecuted as a criminal offense because of the potential for serious adverse health consequences to patients from such promotional activities. Another major category of federal financial penalties was purposely overcharging for drugs under various federal programs, which constitutes a violation of the FCA.

Here’s the report:

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Posted in Congress, Health, Pharmaceuticals | Tagged big pharma, corruption, defense contractors, fraud, oversight | 2 Comments

2 Responses

  1. on December 17, 2010 at 7:59 pm David Peterson

    Join the campaign to find and support congressional candidates who will fight Crony Capitalism.

    http://www.facebook.com/pages/End-Crony-Capitalism/145626605487516


  2. on December 21, 2010 at 4:06 pm Democracy Now! discusses Public Citizen report on pharmaceutical industry fraud « CitizenVox

    […] Group, joined Democracy Now!’s Amy Goodman and Juan Gonzalez this morning to talk about our new report that shows the pharmaceutical industry has overtaken the defense industry in the amount of fines paid for violating the Fair Claims […]



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