Sun fires off 2 huge solar flares, could impact weather on Earth

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Fox News

Written By Tariq Malik

Published March 07, 2012

Space.com

The sun unleashed a cosmic double whammy Tuesday, March 6, erupting with two major flares to cap a busy day of powerful solar storms. One of the flares is the most powerful solar eruption of the year, so far.

Both of the huge flares ranked as X-class storms, the strongest type of solar flares the sun can have. They followed several weaker, but still powerful, sun storms on Tuesday and came just days after another major solar flare on Sunday night.

The first big solar storm was also the most powerful one, ranking as an X5.4-class flare after erupting at 7:02 p.m. EST (0002 March 7 GMT), according to an alert from the Space Weather Prediction Center operated by the National Weather Service. It is the strongest solar flare yet for 2012.

March 6, 2012: NASA's Solar Dynamics Observatory captures the sun as it unleashed an X5.4-class solar flare at 7:04 p.m. EST. The flare appears as the bright spot in the upper left. (NASA/SD)

The second event occurred just over an hour later, reaching a maximum strength of X1.3.

Several space-based observatories witnessed the solar flares, including NASA's Solar Dynamics Observatory and the agency's Stereo-B spacecraft. The sun-watching observatories spotted huge clouds of charged particles — called coronal mass ejections, or CMEs — erupting from the solar flares.

"First-look data from Stereo-B are not sufficient to determine if the cloud is heading for Earth," astronomer Tony Phillips wrote on his website Spaceweather.com, which monitors space weather events. "Our best guess is 'probably, yes, but not directly toward Earth.' A glancing blow to our planet's magnetosphere is possible on March 8th or 9th." [Worst Solar Storms in History]

According to Phillips, the big X5.4 solar flare erupted from the giant active sunspot AR1429, which was also responsible for the major sun storm on Sunday.

When aimed directly at Earth, X-class solar flares can endanger astronauts and satellites in orbit, interfere with satellite communications and damage power grids on Earth. They can also amplify the Earth's display of northern and southern lights, also known as auroras. Charged particles from the solar storms can interact with Earth's upper atmosphere, resulting in a glow that is typically visible to observers at high northern or southern latitudes.

Astronomers rank solar flares by strength using five categories: A, B, C, M and X. The A-class flares are the weakest sun storms, while the X-class events are the most powerful solar flares.

This ranking system was designed by the National Oceanic and Atmospheric Administration and resembles the Richter scale used for earthquakes in that each category is 10 times stronger than the one before it, NASA officials have said. So a B-class solar flare is 10 times stronger than an A-class event, while a C-class solar storm releases 10 times more energy than B-class flare (or 100 times more energy than an A-class event).

The categories are also broken down into subsets, from 1 to 9, to pinpoint a solar flare's strength. Only X-class solar flares have subcategories that go higher than 9. The most powerful solar flare on record occurred in 2003 and was estimated to be an X28 on the solar flare scale, NASA officials said.

Tuesday's X-class solar flares followed a string of other eruptions that included M-class and C-class events, space weather officials said. Both of the day's X-class sun storms were stronger than the X1.1 solar flare of March 5.

Prior to this week, the only huge solar flare of 2012 occurred on Jan. 27, when the sun unleashed an X1.7-class eruption.

The sun is currently going through an active phase of its 11-year weather cycle. The current cycle is known as Solar Cycle 24 and is expected to reach its peak level of activity in 2013, NASA officials have said.

Read more: http://www.foxnews.com/scitech/2012/03/07/sun-fires-off-2-huge-solar-flares-could-impact-weather-on-earth/#ixzz1oRbxh2lf
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There's Something About Sarah - Just Ask CNN Who Couldn't Get Enough of Her

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Sarah Palin gives CNN talking heads something to talk about

It was like a surreal scene from an old Fellini film.  CNN just cut to a voting area in Alaska to cover the state caucus as part of the Super Tuesday coverage of ten states.  Just as the field reporter was starting his report, and you can imagine who would get assigned to Alaska from the CNN team, out of the voting booth behind him comes none other than our favorite Thorn in the Side of the Obama gang, Sarah Palin.

The reporter was stunned and not a little awe struck but kept his senses enough to actually question Palin without asking her if she was carrying a gun.  Well you know how timid those liberals from the lower 48 can be.  Still he asked her about her vote, she refused to tell him, and about what she thought of the election.

As Palin started in with a comprehensive analysis of the campaign, the fair and balanced team of 8 Democrats and 2 half Republicans back in CNN election headquarters suddenly realized the impossible had happened, they had Sarah live on national television, a joy only Fox News has enjoyed since the liberals left her under the train for dead.

In seconds the gang in the studio were firing questions at Palin.  It must be a liberals dream to try and catch Sarah off guard and unprepared on camera at a moment like this, sort of the Katie Couric gotcha all over again.

But this was not the Sarah Palin of old who had to fight off friends and foes alike to gain a prominent and all to often hated place in our national debate.  You see, there is just something about Sarah Palin that simply drives President Obama and his liberal legions out of their minds.

They tried their best to catch her with a gotcha question like why can't Romney capture the conservatives to which she replied every one of the Republican candidates is far more conservative than President Obama and would receive widespread support from the conservatives, independents and even disgruntled democrats if Romney were running against Obama.

Next they tried to get her to condemn Republicans for not speaking out enough against the Rush Limbaugh fuss and she pointed out she was the target for the same kind of abuse over and over again during and after the 2008 presidential election.  No liberals came to her defense and demanded the liberal making the statements apologize or asking advertisers to stop supporting the liberal cable shows.

Finally she said Rush apologizing twice seemed more than enough to end the discussion.

Again they tried to bait her into a discussion of contraceptives to which she said the American people are fed up with the media and Democrat efforts to focus the campaign on condoms and contraceptives.  She talked about how the women she knew were worried far more about the economy, unemployment, their kids and their kid's future than some nonsense about contraceptives.

No matter how hard they tried to trap her she just smiled and turned the question to her agenda about the sorry state of the economy, the socialization of Washington, DC and the precarious nature of foreign affairs.

For several minutes she held them at bay and mesmerized them with her knowledge of world affairs, economic issues and current events. Even I must admit Sarah is much improved in handling the press and discussing any issue they may throw at her.

When the interview ended several of the Palin haters on the panel had to comment on how well she handled the interview, how much she has matured on her knowledge of issues, and how strong and confident she sounded speaking as a leader trying to unite the Republican party.

Thanks to Palin taking the time to talk to a network that has consistently trashed her in most of their stories about her, she showed a degree of class the liberal media has never shown her.

The last question they asked was if she was still available if the Republican nomination was undecided heading into the national convention.  She smiled, laughed and the former Republican vice-presidential candidate told the CNN reporter she would “seriously consider whatever I can do to help our country” when asked if she would agree to being put forward if the party faced a brokered convention.

The Tea Party darling also indicated she would consider running in the 2016 presidential race, if asked.

"Anything in this life, in this world is possible. Anything is possible for an American. I don't discount any idea or plan that, at this point, isn't in my control. Anything's possible,” she said.

Of course the CNN gang, in need of something interesting to talk about while waiting endlessly for election returns, interpreted her message to be she would run for president if asked.  That was not what I heard her say.  What I heard was far more ominous for Barack Obama.  I think she was saying she would be happy to help the Republican candidate try to get the Obama administration out of office.

Palin could easily neutralize any damage done to the party over the religious freedom, contraception and condom issue by refocusing the debate on issues she believes are far more important to women, individual freedom, the economy and gas prices.

Obama's Chicago gang could once again underestimate Sarah Palin if they push her too hard while trying to interfere in the Republican primary process. Perhaps the next song President Obama will be singing will be the blues classic, Obama's Got the Wailing Palin Blues.

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Health Care in America - Illegal "Off-Label" Conspirators

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The Broken American Health Care System

Big Pharma Promotes Illegal “Off-Label” Drug Uses

When Drug Makers’ Profits Outweigh Penalties

By David Evans

Washington Post

Originally Published in Bloomberg News

Sunday, March 21, 2010; G01

http://www.washingtonpost.com/wp-dyn/content/article/2010/03/19/AR2010031905578.html

On the morning of Sept. 2, 2009, another Pfizer unit, Pharmacia agreed to plead guilty to the same crime. This time, Pfizer executives had been instructing more than 100 salespeople to promote Bextra — a drug approved only for the relief of arthritis and menstrual discomfort — for treatment of acute pain of all kinds.


For this new felony, Pfizer paid the largest criminal fine in U.S. history: $1.19 billion. On the same day, it paid $1 billion to settle civil cases involving the off-label promotion of Bextra and three other drugs with the United States and 49 states.


“At the very same time Pfizer was in our office negotiating and resolving the allegations of criminal conduct in 2004, Pfizer was itself in its other operations violating those very same laws,” Loucks, 54, says. “They’ve repeatedly marketed drugs for things they knew they couldn’t demonstrate efficacy for. That’s clearly criminal.”


The penalties Pfizer paid for promoting Bextra off-label were the latest chapter in the drug’s benighted history. The FDA found Bextra to be so dangerous that Pfizer took it off the market for all uses in 2005.


Across the United States, pharmaceutical companies have pleaded guilty to criminal charges or paid penalties in civil cases when the Justice Department finds that they deceptively marketed drugs for unapproved uses, putting millions of people at risk of chest infections, heart attacks, suicidal impulses or death.


It used to be legal for companies to promote drugs in the United States for any use. Congress banned the practice in 1962, requiring pharmaceutical companies to first prove their drugs were safe and effective for specific uses.


If the law is clear, why do drug companies keep breaking it? The answer lies in economics. Pharmaceutical companies spend about $1 billion to develop and test a new drug. To recoup their investment, the companies want doctors to prescribe their drugs as widely as possible.


Since May 2004, Pfizer, Eli Lilly, Bristol-Myers Squibb and four other drug companies have paid a total of $7 billion in fines and penalties. Six of the companies admitted in court that they marketed medicines for unapproved uses. In September 2007, New York-based Bristol-Myers paid $515 million — without admitting or denying wrongdoing — to federal and state governments in a civil lawsuit brought by the Justice Department. The six other companies pleaded guilty in criminal cases.

In January 2009, Indianapolis-based Lilly, the largest U.S. psychiatric drugmaker, pleaded guilty and paid $1.42 billion in fines and penalties to settle charges that it had for at least four years illegally marketed Zyprexa, a drug approved for the treatment of schizophrenia, as a remedy for dementia in elderly patients.


In five company-sponsored clinical trials, 31 people out of 1,184 participants died after taking the drug for dementia — twice the death rate for those taking a placebo, according to an article in the Journal of the American Medical Association.


“Marketing departments of many drug companies don’t respect any boundaries of professionalism or the law,” says Jerry Avorn, a professor at Harvard Medical School. “The Pfizer and Lilly cases involved the illegal promotion of drugs that have been shown to cause substantial harm and death to patients.”


The widespread off-label promotion of drugs is yet another manifestation of a health-care system that has become dysfunctional.


“It’s an unbearable cost to a system that’s going broke,” Avorn says. “We can’t even afford to pay for effective, safe therapies.”


About 15 percent of all U.S. drug sales are for unapproved uses without adequate evidence the medicines work, according to a study by Randall Stafford, a medical professor at Stanford University.


As large as the penalties are for drug companies caught breaking the off-label law, the fines are tiny compared with the firms’ annual revenue.


The $2.3 billion in fines and penalties Pfizer paid for marketing Bextra and three other drugs cited in the Sept. 2 plea agreement for off-label uses amount to just 14 percent of its $16.8 billion in revenue from selling those medicines from 2001 to 2008.


The total of $2.75 billion Pfizer has paid in off-label penalties since 2004 is a little more than 1 percent of the company’s revenue of $245 billion from 2004 to 2008.


Lilly already had a criminal conviction for misbranding a drug when it broke the law again in promoting schizophrenia drug Zyprexa for off-label uses beginning in 1999. The medication provided Lilly with $36 billion in revenue from 2000 to 2008. That’s more than 25 times as much as the total penalties Lilly paid in January.


Companies regard the risk of multimillion-dollar penalties as just another cost of doing business, says Lon Schneider, a professor at the University of Southern California’s Keck School of Medicine in Los Angeles. In 2006, he led a study for the National Institute of Mental Health of off-label use of drugs, including Zyprexa.


“There’s an unwritten business plan,” he says. “They’re drivers that knowingly speed. If stopped, they pay the fine, and then they do it again.”

Paying the doctors


In pushing off-label use of drugs, companies find ready and willing partners in physicians. Under the fragmented system of U.S. medical regulation, it’s legal for doctors to prescribe FDA-approved drugs for any use. The FDA has no authority over doctors, only over drug companies, regarding off-label practices. It’s up to the states to oversee physicians.


“I think the physician community has to take some ownership responsibility and do their own due diligence beyond the sales and marketing person,” says Boston’s former U.S. Attorney Michael Sullivan.


Doctors generally don’t tell people they’re prescribing drugs pitched to them by pharmaceutical salespeople for unapproved treatments, says Peter Lurie, former deputy medical director of Public Citizen, a Washington-based public interest group. Most doctors don’t keep track of FDA-approved uses of drugs, he says.


“The great majority of doctors have no idea; they don’t even understand the distinction between on- and off-labeling,” he says.


Pfizer’s marketing program offered doctors up to $1,000 a day to allow a Pfizer salesperson to spend time with the physician and his patients, according to a whistle-blower lawsuit filed by John Kopchinski, who worked as a salesman at Pfizer from 1992 to 2003.


“By ‘pairing up’ with a physician, the sales representative was able to promote over a period of many hours, without the usual problems of gaining access to prescribing physicians,” Kopchinski says. “In essence, this amounted to Pfizer buying access to physicians.”


Pfizer spokesman Chris Loder says the company stopped what it calls “mentorships” in 2005. He says Pfizer paid doctors $250 a visit. The goal was clear: Get doctors to prescribe a new drug as widely as possible.


Pfizer’s Neurontin is a case in point. The FDA approved the drug as a supplemental medication to treat epilepsy in 1993. Pfizer took in $2.27 billion from sales of Neurontin in 2002. A full 94 percent — $2.12 billion — of that revenue came from off-label use, according to the prosecutors’ 2004 Pfizer sentencing memo.


Since 2004, companies that are now Pfizer divisions have pleaded guilty to off-label marketing of two drugs. Pfizer continued off-label promotions for these medications after buying the firms, according to documents.


Pfizer first stepped into an off-label scheme in 1999, when it offered to buy Warner-Lambert, based in New Jersey. Prosecutors charged that Warner-Lambert marketed Neurontin off-label between 1995 and 1999.


Warner-Lambert admitted doing so for one year in a May 2004 guilty plea for which Pfizer paid $430 million in fines and penalties.


When the FDA approved Neurontin in 1993 to be used only along with other epilepsy drugs, the agency wrote that as a side effect, the drug can induce depression and suicidal thoughts in patients.


The whistle-blower


Much of what prosecutors learned about Warner-Lambert’s marketing of Neurontin comes from a former employee, David Franklin, who holds a Ph.D. in microbiology.


Franklin, 48, whose title at Warner-Lambert was medical liaison, says his job involved more salesmanship than science. He told doctors that Neurontin was the best drug for a dozen off-label uses, including pain relief, bipolar disease and depression.


“Technically, I had responsibility for answering physician questions about all of Parke-Davis’s drugs,” Franklin says. “In practice, my real job was to promote Neurontin for off-label indications heavily — to the exclusion of just about everything else.”


Franklin says he knew such uses of the drug had no scientific support for effectiveness and safety.


“I was actually undermining their ability to fulfill the Hippocratic oath,” Franklin says, referring to a physician’s pledge to “First, do no harm.”


After working for Warner-Lambert for three months, Franklin quit and filed a whistle-blower lawsuit on behalf of taxpayers to recover money the government paid for illegally promoted drugs. He stood to collect as much as 30 percent of any settlement the company made with the government.


Franklin had to wait four years — until 2000 — before the Justice Department began a criminal investigation. In November 1999, Pfizer made its public offer to buy Warner-Lambert. In January 2000, a federal grand jury in Boston issued subpoenas to Warner-Lambert employees to testify about the marketing of Neurontin.


That March, Warner-Lambert’s annual report disclosed that prosecutors were building a criminal case. Undeterred, Pfizer bought Warner-Lambert in June for $87 billion — the third-largest merger in U.S. history.

More sales than Viagra


A year after the acquisition, the FDA discovered that Neurontin was still being marketed off-label. In a June, 2001 letter to the company, the agency wrote that Pfizer’s promotion of the drug “is misleading and in violation of the Federal Food, Drug and Cosmetics Act.”


Pfizer marketed Neurontin off-label after receiving that letter, agency records show. For 2001, Pfizer reported revenue of $1.75 billion from Neurontin sales, making it the company’s fourth-largest-selling drug that year, ahead of impotence pill Viagra, which Neurontin topped for four years.


As Neurontin sales soared to $2.27 billion in 2002, the FDA found that Pfizer was improperly claiming that the drug was useful for a broader range of brain disorders than scientific evidence had established.


The agency sent a letter dated July 1, 2002, that said the company’s marketing practices were in violation of FDA rules. It asked Pfizer to stop using misleading promotions. Pfizer reported $2.7 billion in revenue from Neurontin in 2003. Overall, the drug has provided Pfizer with $12 billion in revenue.


Pfizer spokesman Chris Loder says, “Regarding the 2001 and 2002 FDA letters, we do not believe that they were suggestive of any continuing off-label promotion.”


For blowing the whistle on his employer, Franklin collected $24.6 million under the False Claims Act.


Prosecutors Loucks and Sullivan got involved in the case after Franklin filed his suit, relying on information from Franklin and their own investigation. Before 2004, prosecutions for off-label marketing were rare.


“Until a couple of these cases became public, companies were probably saying, ‘Everybody does it this way,’ ” Sullivan says.


Loucks had a track record in off-label prosecutions. In 1994, he negotiated a $61 million settlement with C.R. Bard of New Jersey, which pleaded guilty to promoting off-label use of a heart catheter that led to patient deaths.

The off-label campaign


In the January 2004 settlement negotiations with Loucks, Sullivan and two other prosecutors, Pfizer’s lawyers assured the U.S. Attorney’s Office that the company wouldn’t market drugs off-label.


“They asserted that the company understood the rules and had taken steps to assure corporate compliance with the law,” Loucks says. “We remember those promises.”


What Pfizer’s lawyers didn’t tell the prosecutors was that Pfizer was at that moment running an off-label marketing promotion using more than 100 salespeople who were pitching Bextra, according to a Pfizer sales manager who pleaded guilty to misbranding a drug in March 2009.


Pharmacia; Upjohn developed Bextra, which was approved by the FDA in 2001 for only the treatment of arthritis and menstrual discomfort.


Pfizer had by then crafted a joint marketing agreement to sell the drug. In November 2001, Mary Holloway, a Pfizer Northeast regional manager, began illegally training and directing her sales team to market Bextra for the relief of acute pain, Holloway admitted in the plea.


On Dec. 4, 2001, Pfizer executives sent Holloway a copy of a nonpublic FDA letter to the company. The agency had denied Pfizer’s application to market Bextra for acute pain. Clinical trials had shown Bextra could cause heart damage and death.


Pfizer bought Pharmacia from Upjohn in April 2003. From 2001 through 2003, Pharmacia operated first as an independent company and then as a unit of Pfizer, paid doctors more than $5 million in cash to lure them to resorts, where salespeople illegally pitched off-label uses for Bextra, it was admitted.


In her guilty plea, Holloway said her team had solicited hospitals to create protocols to buy Bextra for the unapproved purpose of acute pain relief. Her representatives didn’t mention the increased risk of heart attacks in their marketing.


They told doctors that side effects were no worse than those of a sugar pill, Holloway said.


In 2003, Holloway reported her unit’s off-label promotions of Bextra up the corporate ladder at Pfizer, according to a presentencing memo to the judge written by Robert Ullmann, Holloway’s attorney. Top managers didn’t attempt to halt the illegal conduct, the memo said.


By late 2004, Bextra reached blockbuster status, with annual sales of $1.29 billion. Holloway promoted Bextra until the FDA asked Pfizer in April 2005 to pull it from the market for all uses.


The agency concluded that the drug increased the risk of heart attacks, chest infections and strokes in cardiac surgery patients. In June 2009, Holloway, 47, was sentenced to two years on probation and fined $75,000. She didn’t return phone calls seeking comment.


‘We regret . . . ‘


By 2007, the criminal and civil cases against Pfizer, its employees and its subsidiaries had begun to mount. The tally of drugs cited by federal prosecutors for off-label promotion reached six by 2009. In April 2007, Pfizer pleaded guilty to a felony charge of offering a $12 million kickback to a pharmacy benefit manager. Pfizer paid a criminal fine of $19.7 million. In September 2009, Pfizer agreed to pay $2.2 billion in fines and penalties. Pfizer pleaded guilty to a felony charge of misbranding Bextra with the intent to defraud. After the settlement, Pfizer general counsel Amy Schulman said the company had learned its lesson.

“We regret certain actions we’ve taken in the past,” she said. “Corporate integrity is an absolute priority for Pfizer.”


One reason drug companies keep breaking the law may be because prosecutors and judges have been unwilling to use the ultimate sanction — a felony conviction that would exclude a company from selling its drugs for reimbursement by state health programs and federal Medicare.


At Pfizer’s Pharmacia sentencing in October, U.S. District Court Judge Douglas Woodlock said companies don’t appear to take the law seriously. “It has become something of a cost of doing business for some of these corporations, to shed their skin like certain animals and leave the skin and move on,” he said.


As prosecutors continue to uncover patterns of deceit in off-label marketing, millions of patients across the nation remain in the dark. Doctors often choose the medications based on dishonest marketing by drug company salesmen.


Loucks says that putting an end to the criminal off-label schemes will be difficult. As drugmakers repeatedly plead guilty, they’ve shown they’re willing to pay hundreds of millions of dollars in fines as a cost of generating billions in revenue.


The best hope, Loucks says, is that drug companies actually honor the promises they keep making — and keep breaking — to obey the law of the land.


As much as $100 million for health-care fraud enforcement is tied up in the stalled reform legislation, according to Loucks.

“It will be increasingly hard for the threat of exclusion to seem credible and thus serve as a deterrent to bad corporate behavior,” he says, “unless Congress supports health-care fraud prosecutions with more money.”


A version of this story originally appeared in Bloomberg Markets Magazine. It was awarded a 2010 Society of American Business Editors and Writers award for enterprise reporting and general excellence.
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Health Care in America - Increasing Criminal and Civil Monetary Penalties Against the Pharmaceutical Industry

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The Broken American Health Care System

Rapidly Increasing Criminal and Civil Monetary Penalties Against the Pharmaceutical Industry: 1991 to 2010

Sammy Almashat, M.D., M.P.H, Charles Preston, M.D., M.P.H, Timothy Waterman, B.S., Sidney Wolfe, M.D.

Public Citizen’s Health Research

Group EXECUTIVE SUMMARY

Background

U.S. spending on prescription drugs has increased from $40 billion in 1990 to$234 billion in 2008. In this era of rapidly rising drug costs, the illegal pharmaceutical company activities that have contributed to such inflated spending have garnered a significant amount of media attention. Recent billion-dollar settlements with two of the largest pharmaceutical companies in the world, Eli Lilly and Pfizer, provide evidence of the enormous scale of this wrong doing.  However, the total size, varied nature, and potential impact of these illegal and potentially dangerous activities have not been previously analyzed. This study examined trends from 1991 to the present in federal and state criminal and civil actions against pharmaceutical companies in order to address these questions.

Analysis

The purpose of this study was to compile a comprehensive database of all major criminal and civil settlements between federal and state governments and pharmaceutical companies. Press releases from both federal and state governments, in addition to existing online databases, were used to identify all settlements of at least $1 million during the past 20 years.

Main Findings

• Of the 165 settlements comprising $19.8 billion in penalties during this 20-year interval, 73 percent of the settlements (121) and 75 percent of the penalties ($14.8 billion) have occurred in just the past five years (2006-2010).
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• Four companies (GlaxoSmithKline, Pfizer, Eli Lilly, and Schering-Plough) accounted for more than half (53 percent or $10.5 billion) of all financial penalties imposed over the past two decades. These leading violators were among the world’s largest pharmaceutical companies.
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• While the defense industry used to be the biggest defrauder of the federal  government under the False Claims Act (FCA), a law enacted in 1863 to prevent defense contractor fraud, the pharmaceutical industry has greatly overtaken the defense industry in recent years. The pharmaceutical industry now tops not only the defense industry, but all other industries in the total amount of fraud payments for actions against the federal government under the False Claims Act.
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• The practice of illegal off-label promotion of pharmaceuticals has been responsible for the largest amount of financial penalties levied by the federal government over the past 20 years. This practice can be prosecuted as a criminal offense because of the potential for serious adverse health effects in patients from such activities.
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• Deliberately overcharging state health programs, mainly Medicaid fraud, has been the most common violation against state governments and is responsible for the largest amount of financial penalties levied by these governments. This type of violation is also the main factor in the considerable increase in state settlements with pharmaceutical companies over time.
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• Former pharmaceutical company employees and other “whistleblowers " have been instrumental in bringing to light the most egregious violations and have been responsible for initiating the largest number of federal settlements over the past 10 years. From 1991 through 2000, qui tam (whistleblower) cases made up only 9 percent of payouts to the government, but from 2001 through 2010, they comprised 67 percent of total payouts.

Conclusion

Over the past two decades, especially during the past 10 years, there has been a marked increase in both the number of government settlements with pharmaceutical companies and the size of the accompanying financial penalties.  The reasons for these increases are likely related to a combination of increased violations by companies and increased enforcement on the part of federal and state governments.  The danger to public safety and the loss of state and federal dollars that comes with these violations require a more robust response than the government’s current practices. Given the relatively small size of current financial penalties when compared to the perpetrating companies’ profits, both increased financial penalties and appropriate criminal prosecution of company leadership may provide a more effective deterrent to unlawful behavior by the pharmaceutical industry.

Worst Offenders and Largest Settlements

Individual Companies: Total Penalties, 1991-2010

There are 20 pharmaceutical companies that paid a total of at least $100 million each in financial penalties over the past 20 years. The four worst offenders, with at least $1 billion in penalties each, were GlaxoSmithKline, Pfizer, Eli Lilly, and Schering-Plough. Together they accounted for more than half (53percent) of all financial penalties paid out by pharmaceutical companies.

Twenty Largest Settlements, 1991-2010

The 20 largest settlements over the past two decades follow. In the largest settlement of the past 20 years, GlaxoSmithKline agreed to pay the federal government $3.4 billion in 2006 for failing to pay required taxes over a 17-year period.

The second and third largest settlements included the two largest criminal fines ever levied by the federal government against any company. In January 2009, Eli Lilly was forced to pay $515 million (the largest criminal fine ever received by a corporation at that time) and Pfizer, later that year, was fined$1.2 billion (the largest criminal fine ever imposed in the U.S.). Both companies were fined for illegal off-label promotion.

The majority (14) of the 20 largest settlements have occurred within the past five years (2006-2010), consistent with the dramatic increase in pharmaceutical industry financial penalties in recent years.  Of note, almost all cases (16 of 20) involved violations of the federal FCA, at least in part. Multiple blockbuster drugs (i.e., those with sales exceeding $1 billion per year), such as Neurontin (gabapentin), were involved in these settlements. For example, in the Pfizer case of 2004, the company was charged with illegal off-label promotion of Neurontin, a drug which in 2002 generated 94 percent of its $2.27-billion revenue from off-label use.

Table 2. Pharmaceutical Company Penalties: Worst Offenders

Company - Fine in millions of dollars - Percent of Total

GlaxoSmithKline                                     4501              22.7

Pfizer                                                            2935             14.8

Eli Lilly                                                        1712               8.6

Schering-Plough                                      1339               6.8

Bristol-Myers Squibb                             890                4.5

AstraZeneca                                               883                4.5

TAP Pharmaceutical Products            875                4.4

Merck                                                           806                4.1

Serono                                                          704                3.6

Purdue                                                         620                3.1

Allergan                                                      600                3.0

Novartis                                                       524                2.6

Cephalon                                                     425                 2.1

Johnson & Johnson                                353                 1.8

Forest Laboratories                                313                 1.6

Sanofi-aventis                                           310                 1.6

Bayer                                                            301                 1.5

Mylan                                                           267                 1.3

Teva                                                              181                 0.9

King Pharmaceuticals                          167                 0.8

Other                                                          595                 3.0

*Parent company names are current names without corporate (e.g. inc. or plc) designations. If company is non-existent now, name at time of most recent settlement was used.**Data for 2010 include only the first 10 months of the calendar year (through Nov. 1, 2010)***Percent of $19.813 billion in overall penalties. Percents do not add up to 100% as some cases were excluded due to inability to determine individual company share in settlement.

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