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10 Pharmaceutical Scandals

Questcor Pharmaceutical Price Hike Scandal

In early 2019, two whistleblowers revealed that Questcor Pharmaceuticals was responsible for one of the largest drug price increases in U.S. history. Questcor bribed doctors and their staff to increase sales as part of a "multi-tiered strategy" to boost sales of the H.P. Acthar Gel (best known for treating a rare infant seizure disorder).

In 2000, the price of the gel was $40 a vial, but now, in 2019, it costs nearly $39,000, creating an increase of almost 97,000%. The price increase, combined with the aggressive sales push, has upped the drug's annual sales to over $1 billion. The sales of the drug have also robbed the government of a few billion dollars, Medicare spending and reimbursement on Acthar has increased to almost $2 billion over the past six years. The Justice Department has intervened in the whistleblowers' lawsuit and filed one of their own.

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The Merck Vioxx Scandal

In 2004, pharmaceutical company Merck abruptly announced a recall of Vioxx, which was a popular pain medication at the time. After the fact, it was discovered by the FDA that Vioxx significantly increased the risk of heart attack and stroke. By the time Vioxx was pulled from the market, nearly 25 million Americans had taken the drug, and it was tied to almost 40,000 deaths. 

Many say that Vioxx was the worst drug disaster in history. It's suspected that Merck and the FDA were working together to quiet the health concerns and keep the drug on the market. Fines and class action lawsuits followed, which ended up costing the company more than $5 billion dollars.

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The Roche Medicine Safety Scandal

In 2012, the pharmaceutical company Roche was under investigation for deficiencies in their medicine safety reporting system. After 15,000 deaths were reported as possibly linked to medications marketed by the pharmaceutical company, investigations were conducted to evaluate if the medications should be reported for adverse reactions.

Though the deaths could not be explicitly linked to the use of Roche medications, the company is facing the consequences for their lack of attention, including reworking their comprehensive action plan for reports such as these.

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The Pfizer Celebrex Scandal

Also in 2012, Pfizer came under scrutiny for deceiving the public by falsely representing a study about an arthritis drug called Celebrex. In the study, Pfizer claimed that Celebrex was safer than other anti-inflammatory drugs, such as ibuprofen.  The FDA proceeded to warn Pfizer, along with their co-marketers Pharmacia, that their ads were false and misleading.

The company was then forced to pay over $60 million in charges for bribing government officials to approve and prescribe Pfizer products. Bribed government officials included government doctors, hospital administrators, and members of regulatory and purchasing committees in China, Russia, Italy, Bulgaria, Serbia, Kazakhstan, and Croatia. 

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Mylan's EpiPen Scandal

The EpiPen has long-since been the method of choice for combating life-threatening allergic reaction and, for better or worse, Mylan knew just how vital their medicine was. So what do they do with it? Jacked up the prices to exorbitant amounts. Despite the fact that it only takes $1 to manufacture the EpiPen two-pack, Mylan (who bought the rights to EpiPen in 2009), jacked up the prices from $100 to $600 in 2016.

And consumers can't do anything about it, EpiPen dominates the epinephrine auto-injector market just like Kleenex does with the tissue market. Consumers are just left stuck with only EpiPen to choose from or run the risk of death. At least, until 2018, when the FDA approved the first generic competitor to EpiPen.

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The Bristol-Myers Squibb Abilify Scandal

Abilify is an antipsychotic medication marketed by Bristol-Myers Squibb. In 2007, BMS had to pay over $515 million in fines because it was discovered that Abilify had been marketed for conditions that it had not actually been approved to treat.

Even worse, the company had sales teams marketing the medication to nursing homes, even though they knew the drug had potentially fatal side effects for the elderly who suffer from dementia.

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Martin Shkreli's Daraprim Scandal

You've probably already heard of the infamous 'pharma bro' Martin Shkreli, and for good reason. The public was outraged when the cost of Daraprim hiked from $13.50 to an eye-bulging $750 per tablet. This 5,000% increase received massive public backlash and ridicule. Daraprim is used to treat toxoplasmosis (a parasitic infection that mostly affects those with HIV, malaria, and cancer).

Thanks to the insane price hike, the average cost of treatment spiked from $1,130 to $63,000. Facing public outrage, Shkreli hired lobbyists to help him deal with the fallout. The price did wind up being decreased from $750 per tablet to $375, which is still a 2,500% increase.

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The Merck MMR Scandal

In recent years, Merck has been in the firing line once again for fraudulently representing the mumps component of its MMR vaccine. It is alleged that the company falsified reports that state the current MMR vaccine is more effective than the original MMR vaccine.

There are many whistleblowers, who were employees for Merck, claim to have witnessed firsthand reports being falsified and evidence being destroyed in order to cover it up.

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Rochester Drug Cooperatives Opioid Scandal

The American populace faces an opioid epidemic on a massive scale. Every day, 91 Americans die from an opioid overdose. The crisis began in the late 1990s and early 2000s when doctors began prescribing a lot of opioid painkillers which began the widespread misuse and addiction. From then on, it's become more and more of a problem. With this epidemic claiming tens of thousands of lives a year, the government is trying to hold both sides of the issue (manufacturers and distributors) more accountable.

After a two year investigation, Rochester Drug Cooperatives became the first major drug distributor to be charged for its role in perpetuating this deadly epidemic. The charges against Rochester included conspiring to distribute drugs and defrauding the federal government (after the company didn't report thousands of suspicious opioid orders).

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Valeant Scandal

Valeant wound up being everything that people hate about businesses in today's society. CEO Micheal Pearson was shady at best. Under Pearson's guidance, Valeant became the pioneer for drug gouging back in 2015, with several of the companies drug prices rising between 200% and 300% within two years. The company became a serial acquirer, buying up and investing in drug researchers with over a hundred transactions between 2008 and 2015.

Once they had their researchers, they used opaque accounting to make it difficult for investors to see how they were doing. Not to mention them merging with a Canadian firm for a lower tax rate and keeping intellectual property stored in tax havens like Luxembourg. All-in-all, Valeant was and still is super sketchy.

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