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One problem with the pharmaceutical industry and its regulation (or lack thereof)

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There’s a huge problem with the way the U.S. justice system handles problems with prescription drugs. It was demonstrated again today by news of a $486 million class action settlement wherein Pfizer pays its stockholders for hiding the fact that the drugs Bextra and Celebrex were killing thousands of Americans and creating huge financial liabilities for Pfizer.

Instead of jail time, Pfizer’s executives used company money to handle the inconvenient truth that Pfizer had been knowingly killing patients. In 2008 Pfizer agreed to pay $894 million to settle claims by people who suffered strokes and heart attacks caused by Bextra and Celebrex. Experts said the drugs doubled the risk of cardiovascular problems, and probably caused thousands of deaths. Worse, the evidence showed that Pfizer had known about the risks but didn’t disclose those risks to patients, doctors, the FDA or its own investors.

How many people went to prison to pay for these thousands of deaths? Only one, Scott Reuben, a doctor who admitted he faked all his research. Although Reuben faked studies on such a massive scale that the “Scientific American” journal referred to Reuben as the medical equivalent to Bernie Madoff, Reuben was sentenced to only 6 months in prison. It’s so rare that anyone goes to prison for killing people via defective prescription drugs that Scott Reuben has his own Wikipedia page. The Pfizer executives who knew of the risks and concealed them were not even indicted.

Today, Pfizer agreed to pay $486 million to Pfizer investors who claimed Pfizer executives failed to inform the investors of the financial risks associated with the two drugs. This comes after a 2009 settlement with the government, in which the company agreed to pay $2.3 billion to settle a U.S. Department of Justice probe into its marketing of Bextra and other drugs. Last year, Pfizer also settled another related investor’s suit for $400 million.

A spokesman for Pfizer said that the company and all defendants deny any wrongdoing.

All I can say is that Pfizer has paid a lot of money for a company that engaged in no wrongdoing.

Michael J. Evans, Attorney,  enable javascript

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