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According to the Drug and Cosmetic Act, India which regulates import, manufacture and sales , a drug can only be sold when it is approved for treatment . Pharmaceutical companies are legally bound to follow rules and regulations like the Drug or Cosmetic Act or regulatory bodies like FDA ( Food and Drug Administration ) in other countries . But do pharmaceutical companies always follow the rules ? No, companies sell drugs without proper or half trials , violate regulations to compete , to make more profit and to become number one. It has also been identified that clinical drug trials financed by pharmaceutical companies yield favorable outcomes.
The Pharmaceutical industry is the building block of the medical field, playing a vital role in development, manufacturing and distribution of medications. Advanced research in pharma industry has led medical treatment more effective with better outcomes. Patients trust these companies and take the medicines prescribed by doctors for treatment. However, some companies play with our trust , involving themselves in scandals and unethical practices for the sake of their profit. Here are some notable examples :
It was a multinational pharmaceutical company established in 1961 in India and remained an entity until 2014. In 2008 the Japanese company Daiichi Sankyo took a controlling share and in 2014, Sun Pharma acquired 100 percent of the shares in an all stock deal.
Issue : Ranbaxy Laboratories was found guilty of manufacturing and distribution of adulterated and faulty medicines .
Details
Fabrication of data : The company fabricated data related to the results of medicine trials that were submitted to FDA ( Food and Drug Administration ) , USA . The company altered the test results and failed to conduct proper stability tests for their drugs.
Current Good Manufacturing Practices are guidelines that provide a system of process, control and documentation for safety , quality and efficacy of pharmaceutical products. But the company Ranbaxy violated the regulations of cGMP by not maintaining the required standards .This involved improper testing methods, incomplete testing records and improperly validated testing processes.
The company Ranbaxy produced and distributed adulterated drugs that did not meet the required quality and safety standards leading consumers to health risks.
False claim
Ranbaxy fabricated data related to test results and made false statements to the FDA ( Food and Drug Administration ) about critical information regarding drug manufacturing processes.
Bausch Health Companies formerly known as Valeant Pharmaceuticals is a multinational pharmaceutical company based in Canada, founded in 1959. Initially it developed medicines for skin diseases , gastrointestinal disorders, eye health and neurology later they modified their strategy and bought several pharma companies that produced high quality medicines for different health outcomes and sold the medicines at higher rates .
Issue : The company was involved in a huge financial scandal and losing it’s good reputation and financial stability.
Details :
In 2015 ,it came to light that the company was involved in malpractices to inflate revenue and avoid regulatory scrutiny.This included
Inflated drug price
The company acquired existing drugs from different pharmaceutical companies and increased the drug price sometimes by a thousand percent .The medicines Isuprel and Nitropress increased by 212 % and 525%, after the acquisition of the medicines .
Affect on patient
That price hike led to the unaffordability of those medicines, which caused criticism from the public, lawmakers, and the medical community."
Congressional scrutiny
The pricing practices of the company got the attention of the US Congress leading to an in depth examination of the issue. During this process several witnesses were called to collect evidence and to scrutinize their practices. After the investigation the company Valeant Pharmaceuticals faced acquisitions of misusing and manipulating healthcare system for financial gain.
British multinational pharmaceutical and biotech company , headquarter in London established in 2000, by merging Glaxo Wellcome and SmithKline Beecham. GSK developed malaria vaccine RTS,S , a recombinant protein based vaccine. Besides malaria vaccine, the company has developed several major drugs for different disease like asthma, cancer, diabetes, mental health etc.
In 2012, GSK agreed to pay a fine , approximately $3 billion to settle all the criminal and civil charges against the company which was highlighted as largest healthcare fraud in US history.
Issue : Found guilty of involvement in bribery and promotion of unapproved drugs without reporting health risks and side effects. GSK was fined $489 million by Chinese courts for bribing doctors and hospitals to use its products and bribing government officials and regulators to ease monitoring of GSK.
Details
Promotion of unapproved drugs such as Paxil, Avandia which were not approved by the FDA . GSK promoted the drug Paxil for children and adolescent for treatment of depression despite lacking approval of FDA for paediatric use.
Failed to report safety data :
The company did not submit the data that its diabetes drug Avandia posed the risk of severe side effects like heart attack.
Paying kickbacks :
GSK paid kickbacks to doctors and hospitals to prescribe the company’s drugs. These kickbacks included lavish trips, costly gifts or payments.
In 2012, GSK agreed to pay a fine of approximately $3 billion to settle all the criminal and civil charges against the company which was highlighted as largest healthcare fraud in US history.
Johnson & Johnson an American pharmaceutical company ranked 40 in 2023, on Fortune 500 list of the largest United States corporations. It was founded in 1886, by Robert Wood Johnson, Edward Mead Johnson and James Wood Johnson selling ready-to-use sterile surgical dressings.
Issue : The company faced lawsuits for selling faulty drugs and medical devices
Details :
Defective systems for hip replacement:
The Company sold faulty hip replacement systems which were found defective and failed at a higher rate. This caused various health issues to patients like pain and repetitive surgeries etc. For this reason the company faced several lawsuits and significant settlements.
Improper marketing :
The company sold antipsychotic drugs that were not authorized without mentioning the potential risk factors like stroke ,gynecomastia etc. This deceptive marketing caused legal consequences and settlements .
Talcum powder litigation :
It was also revealed that the company’s product Talcum powder contained asbestos which caused cancers in users. It was also revealed that the company knew about the asbestos contamination but did not inform users. These allegations caused significant legal battles and financial settlements which hampered the reputation of the company.
Johnson & Johnson has paid billions in settlements and fines related to these issues, reflecting the serious impact of their practices on patient safety and public trust.
This is not new as pharmaceutical industries regularly involve themselves in different types of scams which appear every year and the number of frauds is always in rise . Every year they pay huge amount for misrepresentation of data, different financial frauds and other such allegations levelled against them .
Here are some types of pharmaceutical frauds
Pharma companies provide unjustified incentives to health care providers specially doctors to promote their medicines by prescribing them to patients leading to biased medical decisions.
It refers to the process of promoting medicines that have not been authorized by regulatory bodies like FDA ( Food and Drug Administration ) . It involves encouraging the use of the medicines not approved by regulatory authorities . This mal practice mislead healthcare providers and patient that will lead to health risks of patients.
Current Good Manufacturing Practice is a guideline set by the FDA to ensure the maintenance of quality of drugs according to the standards. cGMP violation includes inadequate quality control, improper manufacturing process and fabricated documentation,
This type of practices involves charging from patients or insurers for high cost brand name drugs while supplying less expensive generic alternatives. This type of fraudulent misleads patients paying premium price for a drug that is actually a generic version, leading to inflated costs. It causes financial harm to patients who may be unaware that they are not receiving brand name drugs, they are billed for.
This occurs when pharmaceutical companies falsely claim they are selling drugs at the lowest price while avoiding the discounts they are supposed to provide. This mal practice causes financial burdens to taxpayers ,as public funds are used to cover inflated drug prices. This makes the overall system unfair and less efficient.
This involves manipulation of medical education programmes to secretly promote specific medicines or treatment . Through these programmes pharma companies try to manipulate and influence healthcare professionals to prescribe their products, even if the products are not best options for patients. This type practises prioritize marketing over patient care which causes negative impact on treatment process and patient health outcome.
Selling of compound drugs that have not undergone the necessary testing and not received regulatory body approvals like the FDA. Compound drugs are customized by pharmacist to meet unique needs of patients. It involves mixing ,altering or combining drug ingredients to meet specific requirements. Compound drugs are mostly prepared when standard drugs are unsuitable for patients or required dose is not available in pre manufactured forms or patient required medicines in alternative form like in liquid form instead of a pill. When these drugs are sold without proper testing it can cause safety issues for patients which can lead to faulty treatment. It undermines trust in the healthcare system and can lead to serious health risks or adverse effects for patients relying on these medications.
From several studies it was identified that approximately 10 to 40 % drugs are counterfeit in low to middle income countries. And in the US it is less than 1 %. It is hard to identify the difference between a counterfeit and a real medicine but here are some pieces of advices one can take before using any medicine