Donald Trump Accuses Big Pharma Of ‘Getting Away With Murder’…

Interesting story today regarding president elect- Donald Trump. Regardless of your views on Trump (mine are very mixed) he certainly does seem to be causing a stir. I have to agree with him about Big Pharma ‘Getting away with murder’ though. I have been in contact with many people harmed by Big Pharma over the last decade or more, and I have even met and spoken to people who have lost loved ones and friends to Big Pharma.

GSK’s track record on (what we could perhaps call) ‘Corporate Murder’ (or corporate manslaughter) has been well documented over the years.

Read GSK Whistle-Blower – Greg Thorpe’s hair raising complaint against GSK from their 2012 3 Billion dollar fine for a serious schooling in how unethical GlaxoSmithKline are…

People still contact me regularly about damage they suffered because of GSK, either though Seroxat (Paxil), Myodil, Avandia or other GSK products…

It will be interesting to see how Donald Trump shakes up the drugs industry… and indeed- the world…

Trump’s Comments Are Big Pharma’s Nightmare

I cover science and medicine, and believe this is biology’s century.

The drug industry is just wrapping up what looked like an upbeat week here at the J.P. Morgan Healthcare Conference in San Francisco, where all of the healthcare industry’s biggest executives come every year to court investors and negotiate deals. This is the where big mergers are conceived. But now every pharma and biotech executive has a lump in his throat (they’re mostly men). Because of Donald Trump.

Many pharmaceutical executives hoped that because of the Republican Party’s long-term opposition to price controls and love of free markets, a Trump presidency would involve fewer controls on drug prices than a Hillary Clinton one. But at his first press conference today, Trump made it very clear that is not the case. Here’s what he said, via NPR:

I think a lot of industries are going to be coming back. We have to get our drug industry coming back. Our drug industry has been disastrous. They’re leaving left and right. They supply our drugs, but they don’t make them here. To a large extent. And the other thing we have to do is create a new bidding procedures for the drug industry because they’re getting away with murder.

Pharma has a lot of lobbies, a lot of lobbyists and a lot of power. And there’s very little bidding on drugs. We’re the largest buyer of drugs in the world, and yet we don’t bid properly. And were going to start bidding and were going to save billions of dollars over a period of time.

The “we have to get our drug industry coming back” refers to tax inversions–companies like Mylan, Allergan, and Valeant that have tax domiciles outside the U.S. but operations based here. It also seems to refer to that fact that many drugs are manufactured outside the U.S. So it might sound like a hug, but it’s not. But it’s that second part that will really hurt pharmaceutical companies: the idea that Medicare, the biggest buyer of drugs, will start negotiating drug prices. This is an idea that was popular with Bernie Sanders and Hillary Clinton. It is something drug companies have spent years fighting, because if Medicare has power to insist on a price, they will probably have to pay it.

As with most of Trump’s statements, there is no detail on how this would happen. If Medicare doesn’t have the ability to refuse to offer a medicine, it won’t really be able to lower prices much. Much of Medicare is now run by private sector insurers like Humana or Aetna, who already bid on drugs to get lower prices (this is known as Medicare Advantage). Republicans in Congress may not go along with this. Creating real government bidding on pharmaceuticals could be difficult and tiresome.

Those are details. Donald Trump doesn’t care much for details. The message here is simple and clear:

Donald Trump is going to be a populist president. Pharmaceutical companies are a popular villain. That’s it.

And there are ways Trump could use executive power to hurt drug companies that charge high prices. When Dendreon, a Seattle biotech since bought and sold by Valeant Pharmaceuticals, introduced a cancer drug that cost almost $93,000 in 2010, Medicare put it through a gauntlet called a National Coverage Determination, slowing adoption of the drug. (It flopped.) There are plenty of steps a Medicare administrator motivated by working for an angry Donald Trump could take to hurt a drug company whose price had been deemed too high.

Drug company executives have not been blithely unaware that this might happen. Some have been addressing it publicly. In December, at the Forbes Healthcare Summit, Allergan Chief Executive Brent Saunders announced an expanded patient assistance program to make sure that patients could get access to Allergan medicines for mental illness and infectious disease. He’d also pledged not to take large price increases, limiting Allergan to 10% increases no more than once a year. Here’s what he said about Trump at the time:

I worry today that the pharmaceutical industry has a very false sense of relief or security because of a Trump administration and a Republican Congress. I think we should recognize that the drug pricing issue is a populist issue. Americans are rightfully angry. The fault is not, surely, on the pharmaceutical industry’s shoulders, but we bear that because we make the drugs. We innovate the drugs, and as a result of that, whether we like it or not, or we want to try to explain it or not, we have to deal with it.

To think that President-elect Trump isn’t a populist, that he won’t jump on the next EpiPen scandal and tweet more than Hillary Clinton tweeted, or anybody else, because he’s a prolific tweeter, against any company that does something like that, you’re fooling yourself. I think perhaps the best thing that came out of this election is we have a moment in time to solve it ourselves. Maybe it’s a few months, maybe it’s several months, but we don’t have a lot of time. The next big scandal will revive the debate and probably then some because I think President-elect Trump will be more vicious, more focused on taking down or fighting whoever does something egregious again.

It turns out that Trump didn’t wait for the next egregious drug price increase. He just threw his comments into his first press conference. It doesn’t matter that Gilead Sciences cured hepatitis C, or that vaccines made by Merck and Pfizer and Sanofi keep American kids from dying of meningitis or measles. (In fact, yesterday, Trump said he was considering a commission on autism that might look at the issue of whether vaccines cause the disorder–even though it is settled.) People are mad about drug prices, and they don’t like drug companies, and that makes this a great issue for Trump.

Better yet, it could become a bipartisan issue, one of the few where Democrats will come across the aisle to support change, if anybody can figure out what change is. The pharmaceutical industry has just been thrown in a hole, handed a shovel, and told to dig itself out.

One of the key voices to listen to on this is that of Leonard Schleifer, the founder of Regeneron Pharmaceuticals, a Tarrytown, N.Y., biotechnology company. Regeneron has become a $4.7 billion (sales) company thanks largely to a drug called Eylea, which treats age-related blindness. Schleifer, who is a billionaire because of his Regeneron stake, has become a critic of his peers. Here at the J.P. Morgan meeting, he went off-script during his investor presentation and spent more time talking about drug pricing and the industry’s reputation than about his own company’s finances.

It was a line of discussion that he’d started at the Forbes Healthcare Summit. I asked a panel of pharmaceutical chief executives why the industry is so hated. After the others had answered, Schleifer was literally quivering in his seat. “If you look at the prices of drugs, they have gone up, sometimes double digits twice a year as a very efficient way of increasing profits without coupled to any innovation,” Schleifer said. “It’s ridiculous. It’s no wonder. I hate us also when I see all this stuff.”

Ian Read, the chief executive of Pfizer, disagreed. “The point I want to make is that the total cost of drugs as a percentage of healthcare has not changed in two decades,” Read says. “I don’t know whether you talk about three prices a year, two prices a year, double digits, not double digits. The cost of drugs have not changed as a percentage of healthcare in two decades, so it’s a red herring.”

Schleifer zinged back that drug companies are not “entitled to a fraction of the GDP,” but Read had a point. John Milligan, the chief executive of Gilead, had an even better one when he said, “Let’s talk about the people who are alive.” Gilead was vilified for charging $96,000 a year for Sovaldi, its hepatitis C drug. It didn’t get any credit for the fact that the drug was a cure, and arguably a cost-saving one. But here’s the reality: Schleifer and Saunders are reflecting the popular mood. The arguments Read and Milligan are making are arguments drug companies have been making for years. The pharmaceutical industry used to be one of the most respected in the country but now–maybe because of bad things it’s done, maybe because of a general anti-science sentiment, perhaps because of both–it is one of the least. And those arguments aren’t about to start working in 2017.

There’s no doubt that Trump’s statements are merely an opening salvo, a negotiating position. Things may not be as bad as they sound. It’s also almost certain that Trump and the Republican Congress will put through tax policies that will allow pharmaceutical companies to bring back many billions of dollars in off-shore cash they’ve been protecting from U.S. taxes. The industry is still launching all sorts of innovative products, and these will make money. But for the drug industry as a whole, things just got materially worse.


Was the GlaxoSmithKline FCPA resolution a missed opportunity?


Was the GlaxoSmithKline FCPA resolution a missed opportunity?

Tom Fox | October 11, 2016

The U.K. pharmaceutical giant GlaxoSmithKline has resolved an outstanding FCPA matter for the conduct of its China subsidiary, GSK-China that settled an SEC investigation for a fine of $20 million, with no profit disgorgement—quite a favorable move for the company. Even more amazingly, the company received a declination from the Justice Department, even though it was under the equivalent of a Deferred Prosecution Agreement, called a Corporate Integrity Agreement, for the actions unrelated to its FCPA violations in marketing off-labeled marketed products.

Of course these resolutions did not stand alone as the company had been sanctioned by the Chinese government with a fine of approximately $490 million back in 2014 for the actions of GSK-China. Company employees were criminally convicted and non-Chinese senior executives of the China business unit, who were convicted were deported from China. GSK’s sales in China went in the tank and continue to suffer through this date.

Perhaps the U.S. authorities felt the company had suffered enough. However, in this age of increasing international enforcement, it may well be the SEC and Justice Department missed an opportunity to demonstrate how they would give credit for anti-corruption prosecutions, done by other governments, under local anti-corruption laws; such as was done by Chinese authorities with GSK-China. U.S. authorities could have not only cited to the successful use of domestic Chinese laws as an example in the international fight against bribery and corruption but also specifically stated that how the fine and penalty paid by GSK-China was considered in the calculation of the fine by U.S. regulators.

Such an approach would have emphasized the U.S. government’s favorable outlook for greater international sanctions against corruption, as well as shown companies that they would not be whip-sawed by regulators across the globe for the same conduct. It could have been one of the most public examples of how the U.S. government viewed the international fight against corruption.

I think an opportunity may have been missed. 

Is GSK’s CEO-Andrew Witty’s- Chancellorship Of The University Of Nottingham A Paradigm Of Institutional Hypocrisy?



Sir-Andrew-Witty_DSC9994-reducedUniversity of N


“…Peter C Gøtzsche, MD exposes the pharmaceutical industries and their charade of fraudulent behavior, both in research and marketing where the morally repugnant disregard for human lives is the norm….”

“The main reason we take so many drugs is that drug companies don’t sell drugs, they sell lies about drugs. This is what makes drugs so different from anything else in life”

(May 13th 2015)

Impact caught up with the University’s Chancellor, Sir Andrew Witty, to discuss his appointment, being CEO of GlaxoSmithKline and the £12m donation made to the University.

Witty accepted his position as UoN’s seventh Chancellor at the official inauguration ceremony on 12th March. Witty said he enjoyed the ceremony, although he was glad when it was finished. “It’s not something that I am particularly used to but it was very enjoyable. It’s important for institutions like this to have some history and tradition.”

Witty has maintained close ties with the University since graduating with a BA in Economics in 1985.

In 2012 GlaxoSmithKline, of which Witty is CEO, donated £12,000,000 towards the construction of new research laboratories at the University, raising questions about whether the donation was, in part, responsible for his appointment.

Witty also addressed concerns that the ethical scandals in which GSK have been implicated in recent years, including last year’s £1.9 billion fraud case, would compromise the emphasis that Vice-Chancellor David Greenaway places on ‘social responsibility’.

(May 31st 2013)

“This company has been investigated for bribery allegations in many countries. From our investigation, bribery is part of the strategy of this company. This is why they have bribery activities in China,” said Gao Feng, the head of the economic crimes investigation unit at the Ministry of Public Security.”…

(15 Jul 2013)

“Today’s multibillion-dollar settlement is unprecedented in both size and scope,” Deputy Attorney General James Cole said at Monday’s news conference. “We are determined to stop practices that jeopardize patients’ health, harm taxpayers, and violate the public trust.”

(Wall Street Journal July 2012)

I have been documenting GSK (and Seroxat) for almost nine years now, and the sheer scale of unscrupulous, dishonest, corrupt and sociopathic behavior, which this massively powerful and wealthy pharmaceutical company engages in, on a yearly (or perhaps monthly, weekly, and daily) basis, never ceases to amaze me.

(Read GSK Whistleblower Greg Thorpe’s Department Of Justice Complaint which resulted in GSK’s 3 Billion dollar fine in 2012 for hundreds of examples of systemic fraud and corruption).

GSK seem to get away with this systemic corruption because they operate above the law. Despite the immense harm they have done to consumers for decades now, and despite billions of dollars in fines, department of justice,  serious fraud office- and regulatory- investigations, the top brass remains largely unaccountable.

It’s easy to blame the weakness of the law, and GSK’s influence on government and the regulators. These are undoubtedly factors, but what about GSK’s influence on institutions such as major Universities? What about GSK CEO Andrew Witty’s chancellorship of Nottingham University? Is this not an unethical appointment? Should this University not be embarrassed and ashamed that their chancellor is also the CEO of one of the most  devious, corrupt and fraudulent corporations on the planet?

In January 2013 the University of Nottingham appointed Andrew Witty as its chancellor. The previous year GSK had donated 12 million to the university. That same year of the donation (2012) GSK were fined 3 billion US dollars (the largest health care fraud settlement in US history) after an intensive department of Justice investigation into the company. Furthermore, the year that Witty was made chancellor (2013) was also the year that GSK were caught operating a massive bribery operation in China. In 2014 they were fined 297 million pounds by the Chinese government, and their head of operations there, Mark Reilly, was expelled from the country with a suspended sentence. They are currently under investigation by the UK’s serious fraud office, and are weathering allegations of bribery/fraud networks in several other countries.

However these breeches of ethics (thoroughly disgraceful though they are) don’t reveal in any way the (very real) human damage to patients.

The human destruction behind GSK’s various fraudulent acts are harrowing.

For example, it is estimated that millions of kids were exposed to GSK’s Seroxat drug for many years, despite a recent study revealing that Seroxat is ineffective and extremely harmful in under 18’s. There are potentially tens (if not hundreds) of thousands of cases of child self harm, suicide, and attempted suicide linked to this one GSK drug alone (and the damage to the adult population is similar).

Seroxat should not have been encouraged in this age group, yet GSK promoted it directly to kids (off label): Is this not utterly reprehensible behavior by GSK?

How does the University of Nottingham reconcile its close ties with GSK, and Andrew Witty, in light of these disturbing facts about GSK’s systemic unethical behavior over the years?

In 2012 (the year that GSK paid the US 3 Billion for killing and harming kids and adults with their fraudulent medications) the University of Nottingham began a 7.9 million pounds anti-corruption project, which aimed to :

“…investigate the causes of corruption; how corruption can be measured; and the impact of corruption on different aspects of human wellbeing..”

Quite how the University of Nottingham reconciles this huge anti-corruption study in the college with GSK’s Andrew Witty as head of one of the most (documented as) corrupt corporations in the world, and also as chancellor of the University of Nottingham itself- is beyond me.

This type of thing goes beyond hypocrisy and irony… it’s diabolically absurd. The causes of corruption are quite obvious and GSK is a paradigm of institutional corruption (right on Nottingham university’s doorstep).

Money, individual self interest, institutional self interest,  bribery, greed, and sociopathic, unscrupulous behavior. These are the factors that eventually embed corruption into the core of the culture of companies like GSK. The impact of this corruption is also obvious: it leads to discontent and distrust, and of course immense harm to human well being; particularly if you are a child, or a parent of a child- not warned about the dangers of a medication like Seroxat.

“A DISTRAUGHT mother has called for changes in the law after her teenage daughter hanged herself while taking a controversial anti-depressant.

Sharise Gatchell, 18, underwent a complete personality change when she took Seroxat, which hit the headlines just two weeks after the teenager’s death.

Sharise’s mum Stephanie said the drug ‘scared her’ and she asked the teenager not to take it again. But the Newhaven teenager secretly went back on the anti-depressant — and just weeks later she hanged herself while her parents were away for the weekend”..

(Monday 29 September 2003)

David Healy, professor of psychiatry at Bangor University in Wales, said it was hard to see how so many suicidal children could have been overlooked. “We think if you were to go in and look at this data, anyone without training will find there are at least of the order of 12 children becoming suicidal on this drug out of about 93 [who were given it],” he said.

“This is a very high rate of kids going on to become suicidal. It doesn’t take expertise to find this. It takes extraordinary expertise to avoid finding it.”

In an article published with the re-analysis, Peter Doshi, associate editor of the BMJ, said the new paper “has reignited calls for retraction of the original study, putting additional pressure on academic and professional institutions to publicly address the many allegations of wrongdoing.”

In that same year, more than two million prescriptions for paroxetine were written for adolescents and children in the United States, on the back of an advertising campaign which claimed the trial had shown “remarkable efficacy and safety”. GSK was fined $3bn in 2012 for fraudulently promoting the drug”..

(September 16th 2015)

Does the University of Nottingham care about ethics? Do the academic staff care about human rights? If so- then why do they tolerate having GSK’s CEO, Andrew Witty, as their chancellor, surely this is a blatant breach of the college charter? Is the appointment of Andrew Witty as chancellor not a blatant devaluing of the college’s ethical code? Is it not an insult to the students themselves?

What do academics such as Nottingham’s Professor David Harris think of this? (Dr Harris is a renowned human rights scholar).


Are GSK’s history of flagrant patient/consumer abuses (with drugs such as Seroxat, Avandia and Pandemrix, and encouraging prescribing off label of many of their other drugs)  also considered human rights abuses? or do they not qualify? Is suppressing data leading to the deaths of children a human rights issue? Is hiding side effects, denying the effects of dependence, and not reporting withdrawal symptoms an infringement of a prescription drug users rights?

What does Nottingham’s Professor Paul Heywood think of GSK’s corrupt shenanigans in the US and China? (and the various other probes into corruption by GSK elsewhere). Heywood is an academic who specializes in many aspects of global corruption, and is involved in many studies into corruption.

Is he aware, for example, that recently- it seems- GSK might have broken their corporate integrity agreement with the US Dept Of Justice? What does he think of that?

How can the University of Nottingham claim to be serious about tackling corruption (both academically and institutionally) when it has the CEO of one of the most corrupt corporations in the world as its chancellor?

Prof Heywood corruotion

“Professor Heywood is author, co-author or editor of sixteen books and more than eighty journal articles and book chapters. His research focuses on political corruption, institutional design and state capacity in contemporary Europe. Current funded research includes an ESRC/Hong Kong project on Integrity Management in the UK, HK and China, and an EU FP7 project, ANTICORRP, on anti-corruption policies. He is also currently the UK Local Research Correspondent on Corruption (2012-14) for the European Commission’s DG Home Affairs, helping to produce an EU Anti-Corruption Report.”


Paul Heywood appointed Programme Leader of anti-corruption research partnership

The School of Politics and International Relations is delighted to announce that Paul Heywood has been appointed Programme Leader of a £3.6 million BA/DfID initiative to fund international research to identify the most successful ways of addressing corruption in developing countries. To support him in the role, Paul has been awarded a grant of £117.5k that will allow for partial buy-out from his duties at Nottingham until June 2018.

The British Academy (BA) and the Department for International Development (DFID) evidence partnership aims to support world-leading multi-disciplinary research towards effective policy making and interventions. The partnership will address evidence gaps in what works in reducing corruption.

The initiative forms one component of a wider DfID Anti-Corruption Evidence (ACE) programme, that will run for three years and will also involve a new Anti-Corruption Research Partnership Consortium focussing on two themes: (i) the inter-dependencies between anti-corruption interventions and their impact on corruption; (ii) the private sector and economic growth.

Paul’s success is indicative of the high regard in which his research on corruption and governance is held.

Posted on Monday 5th October 2015

I started this blog in 2007, and i thought by documenting GSK (and in particular their dangerous Seroxat/Aropax/Paxil drug) something would eventually be done about their behavior. I imagined that someone in power, either in the US or the UK, would stop them from being so unethical. I hoped that someone, somewhere, would see that the damage to patients from a drug like Seroxat is just unacceptable. There are many of us (me included) who have been damaged because of GSK’s corrupt behavior. I’m just one individual damaged by one GSK medication (and their failure to warn me of side effects) but there there are countless consumers of GSK products damaged and harmed on a global scale

I thought, by raising awareness of GSK’s misdeeds, someone would put a stop to this unethical and immoral abuse of patient and consumer rights? This hasn’t happened yet.

GSK get away with abuse of patients and consumers, bribery, fraud and corruption, because not enough doctors, academics, or government personnel, dare to speak out against them.

Maybe the academics at the University of Nottingham will be different?

Only time will tell..

(for the University of Nottingham’s code of ethics see here)


Collaboration may encourage corporate corruption

20 Aug 2015 14:56:03.197
While the benefits of cooperation in human society are clear, new research from The University of Nottingham suggests it also has a dark side – one that encourages corrupt behaviour.
“Collaborative settings, not just greed, can provide fertile ground for corruption, as typified by recent scandals in the football and banking worlds. But while much is known about individual immoral behaviour, little is known about the collaborative roots of corruption,” explains lead author Dr Ori Weisel from the School of Economics at the University.
The study, The Collaborative Roots of Corruption, published in PNAS journal, focused on cases where working together meant violating moral rules, by lying, at a possible cost to the larger group, or the organization to which they belong.




 Dabvid Greenway

Revisiting The GSK Chinese Corruption Scandal…

Taken From:

GAB | The Global Anticorruption Blog

Law, Social Science, and Policy

Prosecuting GSK: How to Deal with Being Second in Line

As followers of the anticorruption blogosphere know, China recently fined British pharmaceutical giant GlaxoSmithKline (“GSK”) $490 million for bribing Chinese doctors and hospital administrators. There is no need rehash here what many others have already said: this case is likely a watershed moment marking China’s emergence as a force in the global fight against corruption.

But there is another aspect of the story that has gone unnoticed: With rare exceptions, the U.S. Government’s corporate FCPA settlements have either preceded any foreign enforcement action (e.g., Total) or been announced as part of a coordinated global settlement (e.g., Siemens). But China’s prosecution of GSK has put U.S. regulators in a relatively unfamiliar position: that of the second mover. And in doing so, China has forced the Department of Justice to confront a difficult question: Should it care that China has already fined GSK for the same conduct that DOJ is investigating.

Because the United States does not recognize international double jeopardy, China’s action poses no legal obstacle to an FCPA prosecution. In fact, the only legal obligation imposed on U.S. authorities as a result of China’s prosecution derives not from domestic law but from the UN Convention Against Corruption (UNCAC) art. 42(5) and OECD Anti-Bribery Convention art. 4.3. But these sections only require the United States to consult with China regarding the two nations’ overlapping investigations, and even then, only “as appropriate.”

Nevertheless, it’s a safe bet that when it comes time to resolve the GSK matter, DOJ will (1) consider the impact of the prior Chinese penalty and (2) soften its settlement terms as a result. How do we know that? Well, to start, the U.S. Attorney’s Manual — in two relevant provisions (here and here) — advises federal prosecutors to consider the effect of another jurisdiction’s (realized or potential) prosecution when deciding whether it is necessary to charge a particular target. More importantly, though, whether we are speaking of the rare FCPA case where DOJ was the second mover (e.g., Statoil or Alcatel-Lucent) or the many instances where DOJ resolved an investigation as part of a global settlement (e.g., Siemens), on several occasions DOJ seems to have adjusted its settlement demands in order to accommodate penalties exacted by foreign enforcers.

But even if DOJ has done this sort of thing in the past, it’s worth considering why it makes sense to do it again here. After all, the GSK case is a world apart from the Statoil or Alcatel-Lucent resolutions, which followed foreign settlements totaling only a few million dollars. And unlike massive global settlements like Siemens, there was — perhaps unsurprisingly — no coordination here between U.S. and Chinese enforcers.

Stepping back, there are a few reasons to believe DOJ both will and should stick to its past practice and lower its settlement demands even in a case like GSK:

  1. Doing so may encourage additional demand-side prosecutions:  For years, the anticorruption world has decried the lack of demand-side enforcement. (This blog being no exception.) The good news is that a policy of accommodating foreign penalties may help address the problem, even if only marginally and only in the long term. This practice shows respect for a demand-side nation’s sovereignty and its interest in redressing harm caused to it by the defendant’s bribery. Furthermore, a regular and open practice of deference to foreign actions will encourage goodwill between demand- and supply-side authorities, possibly leading to greater coordination of future investigations. (If demand-side officials believe they’ll be afforded their due at the bargaining table, they may be more willing to cooperate with foreign authorities in the future.) Lastly, companies are more likely to cooperative with demand-side investigations when they know that any associated penalty will be taken into account in future supply-side settlement negotiations.
  2. Such reductions may be necessary to avoid overdeterrence:  While many of us would like to stamp out transnational bribery, there is a theoretical point at which enforcement penalties become so high as to pressure companies into taking inefficient precautions (or avoiding certain high-risk markets altogether). To the extent we care about cost-effective responses to corruption, the prospect of overdeterrence is worrisome. Keeping that concern in mind, one could argue that over the past few decades — an era in which U.S. enforcement was the only big game in town — FCPA penalties were inflated to account for harm done to both supply- and demand-side countries. If that’s true, then it makes sense to reduce penalties in FCPA cases that follow (e.g., GSK) or foreseeably precede (e.g., Akzo Nobel) demand-side prosecutions in order to avoid cumulative penalties disproportionate to the underlying conduct.
  3. In some cases, DOJ won’t have a choice:  At the end of the day, there are going to be some companies (e.g., Innospec) who would fold under the financial pressure of successive penalties for the same underlying bribery conduct. It’s not a stretch to say that in a post-Arthur Andersen world, that is an outcome rarely desired by prosecutors. Sure, there are closely-held corporations who will not survive FCPA prosecutions (e.g., Nexus), but more often DOJ officials will treat the policy requirement that they weigh the collateral consequences of initiating a corporate prosecution as reason not to push the boundaries of the defendant’s financial well-being. And even with a company as large as GSK, half of a billion dollars may be a penalty large enough to make DOJ officials worry about not pushing the business too far towards the financial breaking point.

At the end of the day, I wouldn’t be surprised if DOJ’s FCPA prosecutors never quite adjust to the prospect of being second-in-line. But for the health of the global effort to combat transnational bribery — and the reasons given above — it might be best for DOJ to get used to that position. I’ve got my fingers crossed, after all, that GSK is just the latest sign of a growing phenomenon: that of demand-side countries charging forward with their own enforcement actions, even before supply-side countries can do the same.

  • Interesting arguments. Is the Chinese subsidiary of GSK actually registered and trading on the US stock exchange, or is it the parent company; and is this or should it be relevant to the possibility of the same action being taken in multiple jurisdictions? In the case of this British company, what, if anything, would inhibit the UK from filing against this company for the same events pursuant to the UK Antibribery law? In this same line of thought, we have not only the risk of multinational companies being fined in two, but three or as many countries as may have similar antibribery laws and registered stock, which may or may not take such multiple fines into consideration depending upon their particular laws, jurisprudence and customs. Perhaps the time is coming near for a review of the reach of the FCPA.

    • I believe the US is asserting FCPA jurisdiction over GSK on the basis of its status as an issuer on a US exchange. I also believe that you are correct that, under the UK Bribery Act, the UK would also have jurisdiction, though the UK (unlike the US) recognizes the principle of international double jeopardy (ne bis in idem), and so wouldn’t be able to bring a prosecution after a US settlement, and is probably already barred from doing so by the Chinese settlement. (It’s possible I’m wrong, as I’m not an expert in this feature of British law, but I think that’s the case.)

      Your more general observation seems to me to be correct: We’re moving into a world in which multiple sovereigns may have jurisdiction to bring corruption charges against the same entities for the same underlying conduct: If a Korean subsidiary of a British company listed on the New York Stock Exchange pays bribes in China, then four country’s laws have been simultaneously violated, and in principle any of the four, or some combination, might be able to pursue criminal enforcement actions.

      I’m not sure I agree with your last sentence, though. I think it would be a mistake to narrow the reach of the FCPA, both because it remains by far the most robust and effective law against transnational bribery, and because if a foreign company avails itself of US securities markets or territory, than the US has every right to impose and enforce legal restrictions on that firm’s conduct. Rather than narrowing the scope of the law, I’d be more inclined to deal with the problem — as Jordan suggests — through formal or informal agreements between the DOJ/SEC and other countries’ law enforcement agencies about which country or countries should take the lead in which prosecutions, and how they should coordinate.

  • Great analysis (and comment). I’m going beyond the scope of your post here but, to pick up on something you touched upon briefly, one way for DOJ prosecutors to avoid being second-in-line is to coordinate investigations. There are obvious benefits to global coordination on actions against cross-border crime like bribery and a number of law firms have flagged the huge growth potential for such cooperation. In the GSK case, for instance, the SFO worked closely with Chinese authorities for the first time.

    For a variety of reasons, collaborating with demand-side jurisdictions seems markedly different from working alongside other supply-side authorities (although, if the Chinese government is serious about its anti-corruption campaign, maybe not as different as it first appears). At any rate, I don’t see Chinese and U.S. prosecutors cozying up to each other anytime soon.

    But, particularly given the likelihood that Chinese enforcement is on the rise, what do you think of the prospects for increased investigation and settlement coordination between the U.S. and China?

    • Absolutely, coordinated enforcement is the way to go in most of these cases. The cooperation between the US and German authorities in the Siemens case is a great example.

      The problem, as I understand it, in the GSK case is precisely the lack of coordination — due in part to lack of familiarity and lack of trust — between the Chinese and US authorities. (I don’t have a public source for this, but I’ve had informal conversations with lawyers on both the US and Chinese side about this, and they all made more or less that claim.) That’s not to say that this issue is unique to China, but I think it’s likely to be especially acute in that case. But your note about the degree of cooperation between the Chinese authorities and the SFO — which is something I wasn’t aware of — is perhaps encouraging.

  • This is a pretty basic question–just informational–but in relation to your first point and your references to fostering good will and demonstrating respect, is there a sense among demand-side countries that they would prefer the U.S. NOT prosecute for conduct for which the demand-side country has already secured a conviction? Assuming they’ve already received the fine they’ve assessed/been able to enact the punishment they’ve decided on, do they care what the U.S. does? If so, why? From their perspective, is it a matter of being afraid that the U.S. will (as you allude to in your third point) assess a penalty that causes the company to fold and not be able to pay the demand-side country? Just a philosophical matter of it seeming that the U.S. doesn’t view their legal decision as “real” enough to prevent further prosecution (i.e., basically objecting to the U.S. choice not to recognize international double jeopardy)?

GSK says faces UK serious fraud investigation


GSK says faces UK serious fraud investigation

May 27 (Reuters) – GlaxoSmithKline Plc said on Tuesday that Britain’s Serious Fraud Office (SFO) has opened a formal criminal investigation into its commercial practices.

GSK said in a statement that it would cooperate fully with the SFO and was committed to operating its business to the highest ethical standards.

The statement gave no further details about the investigation. (Reporting by Andy Bruce, editing by David Milliken

Forbes Nails Andrew Witty And GSK’s Agenda For What It Is : Utter BS!

It is quite remarkable to see a mainstream corporate news agency like Forbes really nail the problems of GSK and the various ethical/integrity issues that surround Andrew Witty’s tenure as CEO. Great article, and It would be great to see more like it from the mainstream media.

We- the bloggers- have been calling out GSK on their hypocritical corporate bullshit for years now- so it’s good to see some journalists, from the mainstream, are finally catching up. Well done  to Forbes for having the balls to tell it like it is. Kudos.

Erika KeltonErika Kelton Contributor

I write about whistleblower matters involving fraud and other issues.

INVESTING 4/28/2014 @ 5:02PM 1,737 views

GlaxoSmithKline’s Spin Doctoring Doesn’t Cure Corruption Problems

Andrew Witty, GlaxoSmithKline GSK -0.49%’s CEO, has been a busy man over the past couple years, taking every opportunity to convince the public that the company has reformed its culture and marketing practices.

But despite the full-on PR campaign, claims continue to surface about Glaxo using bribes to induce doctors to prescribe Glaxo drugs. Allegations of Glaxo’s bribery in China have hung over the company for nearly a year, and just recently similar concerns have been raised publicly about the company’s marketing practices in Poland, Iraq, Jordan and Lebanon – in all, a list that is becoming as long as an Amazing Race itinerary.

It has been less than two years since Glaxo paid the US government a record-setting $3 billion to settle a range of fraud and bribery allegations, including allegations that it paid kickbacks to doctors to prescribe Glaxo drugs and that it marketed many of its drugs for unapproved uses, making unsubstantiated claims about results. (A number of those allegations were raised by whistleblowers my firm represented.)



GlaxoSmithKline Chief Executive Officer Andrew Witty said “displaying integrity” is a company priority, but the recent spate of bribery allegations belie those words. 

If the latest allegations are true, Andrew Witty will need to work overtime to dispel the conclusions that Glaxo simply “off-shored” illegal sales tactics first developed in the United States and that the pharma giant continues to foster a culture where bribery and kickbacks are considered standard sales practices.

CEO Witty promised in 2012 that GSK would make “displaying integrity in everything we do” a priority. However, the temptation of rapidly growing markets in Asia, the Middle East and Europe may have proven too difficult to resist. After all, it’s harder to convert “integrity” into rising share prices than it is to boost profits through questionable business practices.

The flood of bribery allegations is a test even for Glaxo’s professional spin doctors who, rather ironically, try to distract the public from bad news on the ethical front by announcing the company’s latest steps to reinvent itself as an ethical business venture.

For example, prior to its November 2011 announcement that the company would pay $3 billion to resolve the U.S. liabilities, Glaxo moved to pre-empt the bad news by announcing it was changing its US sales representatives’ compensation structure so that they would no longer be rewarded based on the volume and value of prescriptions sold. Such incentive-based compensation is considered to encourage illegal practices that drive sales.

But as the latest alleged bribery revelations suggest, limiting those changes to the US sales force left the rest of the world – including Glaxo’s most rapidly growing markets – open to questionable practices encouraged by incentive compensation structures that Glaxo failed to change outside the US.

In 2013, dogged by numerous media stories that it was bribing doctors in China to prescribe its drugs, Glaxo tried to blunt the fallout by belatedly announcing that all of its sales representatives worldwide would be compensated under the same terms as its US sales force, replacing financial incentives based on sales with ones based on the quality of service sales reps provide doctors and other healthcare providers.

Then in March, a top Glaxo official said in a media interview that Glaxo would hire doctors in-house to market its drugs, rather than pay physicians to speak to other doctors about its products. Within just a few weeks, like clockwork, allegations of GSK bribing physicians in Iraq, Jordan, Lebanon and Poland surfaced.

One gets the feeling that Glaxo’s compliance efforts are geared more to pre-empting bad news than they are to making meaningful and effective changes to its business culture.   Glaxo’s piecemeal approach to compliance holds back on clearly needed wholesale changes while the executive suite waits for the next investigation of unethical conduct to crop up.

With Glaxo’s recent history, it is hard to keep a straight face when reading the company’s statement responding to the latest bribery allegations involving Jordan and Lebanon. Glaxo declares: “We are confident in our processes and controls and that we do not have a systemic issue with unethical behavior in GSK.”

If Glaxo truly doesn’t recognize that bribery allegations in multiple countries around the globe add up to a “systemic issue,” then the company has even bigger management problems than it seems. In that case, GSK and Andrew Witty should be prescribed a full dose of reality – with unlimited refills.





GSK Corrupt Activity In Iraq Goes Back Years…

GSK were investigated for bribing Saddam Hussein’s regime with kickbacks back in 2007, however the investigation seems to have disappeared after making headline news at the time…

Apart from the report on kickbacks in 2007, there was also a report from 2013 detailing a case where GSK are mentioned in conspiring with Hussein’s regime, the case was struck out on technicalities in the US court… In other words… they got away with it.. (no surprise there then!)…

An Iraqi lawsuit accusing more than 90 companies of conspiring with Saddam Hussein’s regime to frustrate the United Nations’  program, and depriving Iraqis of roughly $10 billion of essential aid, has been dismissed by a court in New York. (See more here)

This from 2007:

Firms accused of bribing Saddam to be investigated by fraud office

· British companies named in United Nations report
· Kickbacks ‘enabled Iraqi leader to amass $1.8bn’

The Serious Fraud Office has launched an investigation into allegations that a number of major UK-based firms paid bribes to Saddam Hussein’s regime in Iraq. The firms being targeted include the drug giants GlaxoSmithKline (GSK), AstraZeneca and Eli Lilly. 

And from 2008:

The drugs company, which has been the almost exclusive supplier of medicines and vaccines to Iraq’s ministry of health for over 20 years, is setting up a manufacturing base in the country.

The agreement with local firm Modern Drug Industries will see GSK medicines packaged and manufactured at their Baghdad facilities.

With an increasing number of international pharmaceutical companies vying for business in Iraq, GSK hopes that establishing a secondary local manufacturer will provide a significant advantage when competing for tenders in future.

GSK said producing drugs closer to the customer would improve their cost base and enable them to sell products on at an “access price”.

The company said it also has plans to open its first private business in the country since the invasion by year-end and will be hiring a “significant number” of local staff.

From 2011

Iraq remains a dangerous place to live and do business due to ongoing violence and political instability. But that isn’t stopping impatient investors anxious to take part in the nation’s rebuilding. GlaxoSmith Kline (GSK), Britain’s largest pharmaceutical company, has signed an agreement with Modern Drug Industries, an Iraqi company, to manufacture and package drugs in Baghdad.

GSK has been the Iraq Ministry of Health’s main supplier of vaccines and other medicines for more than 20 years. Now GSK plans to be the first pharma giant to enter the Iraq market since the 2003 invasion.

Harrington Investments Divests From GlaxoSmithKline (2007)

August 29, 2007

Contact: Jack Ucciferri

(707) 257-7923 Fax

(707) 252-6166 Voice

Harrington Investments Divests From GlaxoSmithKline

Cites Litany of Concerns

Napa, CA – Harrington Investments, Inc. (HII), a socially responsible investment (SRI) advisory firm, announced today that it has divested from GlaxoSmithKline (GSK) stock.

“In accordance with our long term investment management style, we would prefer to remain invested in GSK,” said John Harrington, President and CEO of Harrington Investments. “However, we have a fiduciary duty to our clients that includes a comprehensive review of a corporation’s overall operations and reputation.”

In a letter to GlaxoSmithKline CEO, Jean-Pierre Garnier, Harrington listed six points of concern with the company, including investigations for shady business dealings with Saddam Hussein, improper marketing of anti-depressants, and tax avoidance.

The letter also cited GSK’s inability to address the concerns of animal rights activists and its resistance to providing affordable AIDS drugs to developing countries.

The list concludes: “On a lighter note, we are bemused that GSK – one of the largest drug makers in the world – was recently ‘busted’ by two 14-year-old schoolgirls for wildly exaggerating the quantity of vitamin C present in a popular children’s fruit drink! Unfortunately, however, this action on the part of GSK continues to undermine your company’s reputation and your management’s credibility.”

Like many SRI firms, HII proactively avoids, or ‘screens out,’ stocks of corporations with significant negative environmental, social, and/or corporate governance (ESG) issues. Once it decides to purchase shares in a company, HII generally tries to work with corporate management to improve ESG performance.

HII’s divestiture of GSK stock is a reaction to corporate management’s consistent failure to address important investor fiduciary concerns.


Jack Ucciferri
Research and Advocacy Director (RAD)
Harrington Investments, Inc.

ph. 707.252.6166
fax 707.257.7923

Ethics Blog Casts An Eye On GSK

August 19, 2013

GSK in China: A Game Changer in Compliance

I have published my first eBook-GSK in China: A Game Changer in Compliance. In this eBook, I review the information on the GlaxoSmithKline bribery and corruption allegations in China to-date, what you can do about it as a compliance practitioner and what it may all mean for international companies doing business in China.

I am sure that you will find it useful going forward to your compliance challenges. It is available through Kindle for only $4.99. You can download a copy here and start reading about it now.

GSK: Officially the most corrupt company in the world…

I haven’t had much time to digest all the recent stuff about GSK in the media over the last few days. The sheer volume of headlines, tweets, opinion pieces and blog posts about GSK’s recent $3 Billion fine in the US is staggering. But I have been bookmarking some of the more interesting snippets within the multitudes of GSK discourse on the internet. I will do a blog post about it all soon, and I think it’s time here at GSK: License to (K)ill that I stepped it up a gear. I’ve been way too polite about what I really think of this despicable pharmaceutical company. From now on… The Gloves are off.

GSK to Pay $3 Billion Settlement for Committing Fraud

Years of deceitful drug marketing led to a $3 billion resolution this week with the U.S. Justice Department. It’s the biggest health fraud settlement in U.S. history. Federal prosecutors say it shows how seriously they take the problem.

David Healy and Critical Psychiatry

011 Andrew Herxheimer Talk & Panel Discussion with Professor David Healy, chaired by Dr Joanna Moncreiff- with closing remarks a

by APRILPLUS 1 year ago / 

Creative Commons License:



Adverse side effects of medicines and anaesthetics also called adverse drug reactions (ADRs) or iatrogenic illness, is a major public health problem. Admissions to UK hospitals due to ADRs increased by 78% in ten years to 2009.

A remarkable conference to discuss the problems held in 2008, was organised by APRIL charity (Adverse Psychiatric Reactions Information Link. This video clip is the panel session, the end of the conference and features most of the speakers and questions from the audience. Closing remarks by Dr Andrew Herxheimer, Millie Kieve (Founder of APRIL) and Lucille Grant (trustee of APRIL)

The session is chaired by Dr Joanna Moncrieff, psychiatrist, author of ‘The Myth of the Chemical Cure’ and member of the Critical Psychiatry Group who are concerned about over use of psychiatric medication.


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