Check out this roundup of off-label marketing cases by the AP. Here's a key section:
"Critics of off-label marketing say drug makers continue to do it for one simple reason: profits. Even when drug makers are forced to pay huge fines, the amounts are small when compared to the money that can be made by promoting drugs for off-label uses.
In 2004, Pfizer paid $430 million in fines to settle allegations it marketed the epilepsy drug Neurontin for pain and psychiatric illnesses. David Franklin, a medical liaison who became a whistleblower against the company, said that even after the settlement - one of the largest ever in a health care fraud case - doctors told him that other pharmaceutical companies were still actively promoting their drugs for off-label uses.
'The $430 million penalty was widely referred to as a slap on the wrist,' Franklin said."
I wish I had written this story. Here's why: The key factor here is that drug company M&A activity has created corporations of such enormous size that even a fine of $430 million is not regarded as significant. Thus, it can be argued, Big Pharma has essentially discovered a way to avoid complying with the FDA rules -- by becoming so big that the rules are trivial by comparison.
For example: Pfizer's annual revenues are in excess of $50 billion. That $430 million Neurontin fine represents exactly 0.86% of those revenues.
While people within the drug business are aware of this, most lawmakers and almost all consumers are certainly not. I remember discussing the Genotropin story with my boss before we published it. She wanted me to find out whether any potential fines paid by Pfizer for Pharmacia's off label marketing of the drug could impact the value of the company and trigger shareholder lawsuits.
It took me a while to explain to her that even if the fine was as big as the Neurontin settlement, Pfizer was so massive that its impact on the share price would be too tiny to register. In the event, the Genotropin fine was even smaller than that ...
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