Corporate Crime in the Pharmaceutical Industry


The sordid behaviour of today's pharmaceutical corporations has been further demonstrated by Dr John Braithwaite, now a Trade Practices Commissioner, in his devastating exposé, CORPORATE CRIME IN THE PHARMACEUTICAL INDUSTRY.

International bribery and corruption, fraud in the testing of drugs, criminal negligence in the unsafe manufacture of drugs - the pharmaceutical industry has a worse record of law-breaking than any other industry. Describing many examples of corporate crime, which shows the depth and seriousness of the crime problem in the pharmaceutical industry, Dr Braithwaite's revealing study is based on extensive international research, including interviews of 131 senior executives of pharmaceutical companies in the United States, the United Kingdom, Australia, Mexico and Guatemala.

The book shows how pharmaceutical multinationals defy the intent of laws regulating safety of drugs by bribery, false advertising, fraud in the safety testing of drugs, unsafe manufacturing processes, smuggling and international law evasion strategies. At the time of researching the subject, Braithwaite was a Research Criminologist at the Australian Institute of Criminology and a Fulbright Fellow affiliated to the University of California, Irvine and the United Nations Center on Transnational Corporations.

"Data fabrication is so widespread", says Dr Braithwaite, "that it is called 'making' in the Japanese pharmaceutical industry, 'graphiting' or 'dry labelling' in the United States." He further states:

"Pharmaceutical companies face great temptations to mislead health authorities about the safety of their products. It is a make or break industry - many companies get virtually all their profits from just two or three therapeutic winners. Most of the data that the Australian Drug Evaluation Committee relies upon in deciding questions of safety and efficacy is data from other countries, particularly the US. Inquiries into scientific fraud in the US have shown there is a substantial problem of fraud in safety testing of drugs in the US, just as has been documented in Japan."

The book reports that between 1977 and 1980 the United States Food and Drug Administration have discovered 62 doctors who had submitted manipulated or downright falsified clinical data. A study conducted by the FDA has revealed that one in five doctors investigated, who carry out field research of new drugs, had invented the data they sent to the drug companies, and pocketed the fees. Citing case examples, Dr Braithwaite states: "The problem is that most fraud in clinical trials is unlikely to even be detected. Most cases which do come to public attention only do so because of extraordinary carelessness by the criminal physician..."

According to Dr Judith Jones, Director of the Division of Drug Experience at the FDA, if the data obtained by a clinician proves unsatisfactory towards the drug being investigated, it is quite in order for the company to continue trials elsewhere until satisfactory results and testimonials are achieved. Unfavourable results are very rarely published and clinicians are pressured into keeping quiet about such data.

It is very easy for the drug company to arrange appropriate clinical trials by approaching a sympathetic clinician to produce the desired results that would assist the intended application of the drug. The incentive for clinical investigators to fabricate data is enormous. As much as $1000 per subject is paid by American companies, which enables some doctors to earn up to $1 million a year from drug research, and investigating clinicians know all too well that if they don't produce the desired data, the loss of future work is inevitable.

by Dr John Braithwaite

Poisonous Prescriptions

by Dr Lisa Landymore-Lim

"Given that a poison is ANY substance that when introduced into or absorbed by the body injures health or destroys life, most of today's pharmaceutical preparations, because of their harmful effects, may be labelled poisonous."

The above opening to POISONOUS PRESCRIPTIONS (1994) gives the gist of the author's view on allopathic drugs. A view that could not be easily dismissed by health authorities, as Dr Landymore-Lim, a British scientist, is well qualified by their own standards. She graduated in 1983 from the School of Chemistry and Molecular Sciences, University of Sussex, England, with a First Class Honours degree in Chemistry by Thesis. In 1984 she was awarded a study scholarship by the Swedish Institute, and has worked briefly for the Medical Research Council at the National Institute for Medical Research, London, and at the Dunn Nutrition Unit, Cambridge. Concerned about preventing disease, Landymore-Lim is now an independent consultant and investigator, focusing on the harmful effects of pharmaceutical drugs and other chemicals.

POISONOUS PRESCRIPTIONS, which evolved from the author's clinical research conducted in the UK, provides readers with an insight into the poisonous nature of pharmaceutical drugs. The book includes information on a number of commonly used drugs in the United Kingdom and other industrialised countries, paying particular attention to those that are routinely pushed onto babies and young children.

Among the numerous other adverse reactions that are inherently linked to all drugs, Landymore-Lim's investigations have found that diabetes and asthma can result from exposure to antibiotics and other commonly used pharmaceutical drugs. To support her assertions she provides ample evidence from hospital records and her own studies and she explains clearly and simply the complex mechanisms behind the diabetes and asthma-causing properties of chemicals. In dispelling the authorities' widely held misconception that diabetes is largely a genetic disorder Landymore-Lim provides statistics and graphs showing how the incidence of diabetes in industrialised countries has dramatically increased in the last 40 years, coinciding with the rapid rise in the use of drugs during that time period.

No doubt that if Dr Landymore-Lim's information breaks through the Media censorship it will send shock waves through the medical profession. We support her efforts and urge you to assist her group's on-going research. The Prevention of Diseases & Disability (PODD) would like to hear from anyone in Australia who has suffered from any serious drug-related condition to be included on a register.

Vaccination: 100 Years of Orthodox Research Shows that Vaccines Represent a Medical Assault on the Immune System

by Viera Scheibner Ph.D.

This book (published 1993) is a concise summary of the results of orthodox medical research into vaccines and their effects. It aims to inform medical professionals, parents and the general public about short and long-term dangerous side-effects, including brain damage and death, of vaccines; of the ineffectiveness of vaccines in preventing infectious diseases, as shown by epidemics in fully vaccinated populations; and the causal link between DPT and polio vaccines and cot death.

Dr Viera Scheibner, retired Principal Research Scientist for the NSW Government with a doctorate in Natural Sciences, has published 3 books and some 90 scientific papers in refereed scientific journals in Australia and overseas during her distinguished career.

She and her husband, Leif Karlsson, an electronic engineer specialising in patient monitoring systems, developed Cotwatch, a true breathing monitor for babies. Vaccination proved to be the most prominent stressful event to sound the alarm. A microprocessor version of Cotwatch recording babies' breathing patterns presented the effect of vaccination clearly on the computer print-outs and the link between vaccine injections and cot death became painfully obvious.

Following this finding, Dr Scheibner studied some 30,000 pages of medical papers dealing with vaccination. She found no evidence that vaccines are safe or effective. Vaccines are highly noxious. They contain formaldehyde, aluminium phosphate, thiomersal (mercury compound), foreign proteins (antigens) and contaminating animal proteins and viruses from the tissues used as growth medium to culture the viral and bacterial components of vaccines. None of these substances should ever be injected into human beings. They erode the immune system and alter the immunological response to diseases.

The appearance of many new, autoimmune diseases like asthma, affecting alarming numbers of children, childhood leukaemia, and cancer, the enormous upsurge in the incidence of cerebral palsy and infantile convulsions seen in children of vaccination age and not before, should all be taken as serious warnings. Infectious diseases contracted at the appropriate age and allowed to run their course are beneficial because they serve to prime and mature the child's immune system.

The overwhelming evidence from the numerous human clinical and epidemiological studies cited by Dr Scheibner demonstrates beyond any doubt the dangers and ineffectiveness of vaccinations and her book is a most valuable contribution towards exposing the myth of vaccinations.


A major reason why health care is in such a shambles is that the medical establishment has allowed itself to be bought off by the pharmaceutical industry, whose prime motive is profit. In the book Dissent in Medicine - Nine Doctors Speak Out (1985), Dr Alan Levin writes:

"Health care in the United States has become a megabillion-dollar business. It is responsible for over 12 percent of the gross national product. Revenues from the health industry, which currently exceed $360 billion a year, are second only to those of the defense industry. True profits are much higher. [In 1991 the US had spent $750 billion on health care. It has been estimated that by the year 2000, annual health care costs in the US will have increased to at least 1.5 trillion dollars. (50)] It is not difficult, then, to see why this industry is so appealing to corporate investors. Many industrialists determined to profit from health-care products have encountered one major obstacle: Practicing physicians remain the primary distributors of health care products. Physicians, who have traditionally existed as independent entrepreneurs do not fit easily into the corporate mind-set. If corporations did not have control over their distributors (the physicians) they would not be able to guarantee profits to their stockholders.... Thus, we need not wonder why senior executives of major health care-oriented corporations have decided to woo physicians into their camps.

"Pharmaceutical companies have curried the favor of practicing physicians for many years... As the cost of development and marketing of pharmaceuticals increased [during the 1960's], the drug companies efforts to attract the allegiance of practicing physicians intensified.

"Not only did drug company operation costs increase markedly, but the rewards of the marketplace rose tremendously.... The increase in revenues brought competition which led to a nationwide increase in drug advertising. Advertisements in medical journals and public magazines were popularized by carefully controlled news releases associated with 'medical breakthroughs.'

"These advertising efforts, which began with gifts to practicing doctors and medical students, have become a massive campaign to mold the attitudes, thoughts, and policies of practicing physicians. Drug companies hire detail men to visit physicians' offices and to distribute drug samples. They describe the indications for these drugs and attempt to persuade physicians to use their products. Like any other salesman, they denigrate the products of their competitors while glossing over the shortcomings of their own. Detail men have no formal medical or pharmacological training and are not regulated by any state or federal agencies. Despite their lack of training, these salesmen have been very effective. Their sales campaigns have been so successful within the United States that the average physician today has virtually been trained by the drug detail man. This practice has led to widespread overuse of drugs by both physicians in their everyday practice and the lay public.... With the exception of heroin and cocaine, 85 percent of all drugs currently abused in the streets are manufactured by 'ethical' drug companies.... Gross sales forecasts from these 'ethical' drug companies deliberately include profits made from illicit sales to drug peddlers.

"The drug industry woos young medical students by offering them gifts, free trips to 'conferences', and free 'educational material.' [Emphasis added.]

A double page article titled "$200m 'bribe' to lure our doctors", appearing in the Sun Herald (August 18, 1992), reported that:

"Drug companies spend a massive $200 million every year in Australia on marketing their products... That represents almost $10,000 a year spent attempting to woo each of Australia's 21,000 'actively prescribing' GPs, according to Dr Ken Harvey from La Trobe University."

The article cited Theo van Lieshout, secretary of the NSW Doctors' Reform Society as saying that 50 per cent of drugs on the market did not exist 10 years ago - and doctors had not learned about them in medical school. Busy physicians therefore rely mainly on drug company sales staff to tell them about new medications.

As reported in the Bulletin (March 24, 1991), Dr Ken Harvey stated: "The students concede concern. The problem is, after five years out in practice, with six drug reps a week coming in, they have gone away from prescribing sensibly and by scientific name to prescribing the brand promoted by the last rep who walked in."


Drug companies employ many means in bribing doctors and medical institutions. Dr Levin writes:

"Young physicians are offered research grants by drug companies. Medical schools are given large sums of money for clinical trials and basic pharmaceutical research. Drug companies regularly host lavish dinner and cocktail parties for groups of physicians. They provide funding for the establishment of hospital buildings, medical school buildings, and 'independent' research institutes.

"The pharmaceutical industry has purposefully moved to develop an enormous amount of influence within medical teaching institutions. This move was greatly facilitated by several factors. The first was the economic recession, which caused a marked constriction in federal funding for research programs. Academic scientists lacked funding for pet research projects. The second was the tremendous interest that academic scientists held in biotechnology, the stock market, and the possibility of becoming millionaires overnight. The third is the fact that academic physicians tend to lack real clinical experience. In the university, the physician is an expert in esoteric disease, end-stage disease, and animal models of human disease. He or she has little or no experience with the day-to-day needs of the chronically ill patient or the patient with very early symptoms of serious illness. As the academic physician does not depend upon the good will of the patient for his or her livelihood, the patient's well-being becomes of minor consideration to him or her. All these factors make the academic physician a very poor judge of treatment efficacy and a willing pawn of health industrialists.

"Pharmaceutical companies, by enlisting the aid of influential academic physicians, have gained control of the practice of medicine in the United States. They now set the standards of practice by hiring investigators to perform studies which establish the efficacy of their products or impugn that of their competitors....

"Practicing physicians are intimidated into using treatment regimes which they know do not work. One glaring example is cancer chemotherapy....

Your family doctor is no longer free to choose the treatment modality he or she feels is best for you, but must follow the dictates established by physicians whose motives and alliances are such that their decisions may not be in your best interests.

Dr Alan Levin is an Adjunct Associate Professor of Immunology and Dermatology at the University of California. He is a Fellow of the American College of Emergency Physicians, the College of American Pathologists, and the American Society of Clinical Pathologists. Dr Levin is also a recipient of fellowships and awards from Harvard Medical School and other medical institutions, and was Director of various research laboratories.

Ivan Illich echoes Levin's last comment: "The medical establishment has become a major threat to health. The disabling impact of professional control over medicine has reached the proportions of an epidemic." (54)

The Cot Death Cover-Up?

by Dr Jim Sprott

THE COT DEATH COVER-UP? is the culmination of over fifteen years of cot death research by the author, a highly respected consulting chemist and forensic scientist from New Zealand.

In 1986 Sprott arrived at the conclusion that babies were succumbing to cot death because of inadvertent gaseous poisoning by an extremely toxic nerve gas generated by microbiological action on something within the baby's cot, but he wasn't able to identify the gas. Then in 1989 consulting scientist Barry Richardson, working independently in Britain came to the same conclusion and in addition identified the offending gases. It was not long before the two teamed-up to work on what they describe as the "Richardson Hypothesis".

According to Sprott the three identified gases that were generated from mattresses on which babies died of SIDS are "phosphine, arsine and stibine, all extremely toxic 'nerve gases'. They are produced by the action of the otherwise harmless fungus Scopulariopsis brevicaulis on substances containing phosphorus, arsenic and antimony. These elements are often present in cot and other mattresses." These odourless but intensely poisonous gases, with toxicities about 100 times as great as hydrogen cyanide (prussic acid), act upon the baby's nervous system to inhibit breathing and heart function.

The problem, in fact, has been first identified as far back as the 1880's when the mystery of thousands of unexpected child deaths throughout Western Europe and the UK was solved by Italian chemist Gosio. He had discovered that deaths were due to a toxic gas, arsine and/or alkyl homologues generated by the micro-organism Scopulariopsis brevicaulis (then known as Penicillium brevicaules). It acted upon copper arsenate, used in green pigments in wallpaper, and arsenious oxide, used as a preservative in wallpaper glue.

THE COT DEATH COVER-UP? contains ample evidence supporting Sprott and Richardson's findings. Among the many graphs it contains one that demonstrates the rapid drop in cot deaths in Britain in 1986-1994. The graph, based on official statistics, shows that when the findings were first made public in mid-1989 the SIDS rate started to fall immediately, dropping 35 per cent by the time the official "Back to Sleep" campaign was launched in December 1991. In the period 1989-1994, Britain saw a staggering 70 per cent reduction in the SIDS rate.

Despite these remarkable results, Sprott and Richardson were fiercely opposed by their respective country's health authorities and official SIDS groups. Their struggle for official recognition of their findings is reminiscent to that of other independent SIDS researchers such as Dr Archie Kalokerinos and Dr Glen Dettman, who had proved that severe depletion of a child's vitamin C level, precipitated by various insults including childhood vaccinations, could predispose it to SIDS.

The author says that the book is not aimed at academics (although its first-class material should suffice their snobbery), but is aimed at parents - parents who have to suffer the consequences of a system that puts them and their babies last in the "war" against this human tragedy known as SIDS.

Big Pharma's Deadly Experiments

A newly surfaced report alleges that in 1996, drug monolith Pfizer gave an unproven drug to Nigerian children and infants suffering from meningitis -- without the authorization of the Nigerian government. Completed five years ago and coming to light in a May 7 Washington Post investigation, the confidential report, written by a panel of Nigerian health experts, concluded that administering the drug Trovan to 100 patients suffering a deadly strain of meningitis was "an illegal trial of an unregistered drug." The drug was ultimately shown to be ineffective. A lawsuit against Pfizer claims some of the children in the trial died and others suffered brain damage.

The report surfaces as more and more clinical research relocates to the Global South in order to escape burdensome regulation schemes in the United States and Western Europe. AlterNet has obtained an early look at a book to be published later this year -- The Body Hunters: How the Drug Industry Tests Its Products On the World's Poorest Patients (New Press), by investigative journalist Sonia Shah -- that raises the curtain on a trend that's harming patients and health care systems while eroding the developing world's trust in conventional medicine.

Researchers needing patients and freer working conditions have for years found a honey pot in the world's slums and shantytowns. The fact that poor, desperate patients are willing to try anything, means companies like GlaxoSmithKline, Merck and Wyeth currently conduct 30 percent to 50 percent of their experiments outside Western Europe and the United States, and plan to boost foreign trials by 67 percent this year, according to USA Today. Their urgency is understandable; Shah's book notes that to get a single drug to market, drug companies are forced "to convince more than 4,000 patients to undergo 141 medical procedures each in more than 65 separate trials."

Clinical investigators and the companies backing them argue that overseas trials get drugs to a lucky few and lead to faster cures for us all. But Shah, the author of Crude: The Story of Oil, deftly takes that Big Pharma myth to task, tracing how drug trial exports ruin third-world health care systems, steer attention away from public health needs like clean water and sanitation, and ignore the health safety of subjects.

From the history of placebo controls to a modern map of how loophole-prone laws in the 1980s paved Big Pharma's easy way, Shah shows that "the main business of clinical research is not enhancing or saving lives but acquiring stuff: data" -- making it an industry instead of a social service, as it would have the world believe. As an industry, she argues, they should be denied the regulatory winks and nods reserved for a public health entity.

Hearn: What struck you as the worst case of excess or neglect you found while researching this book?

Shah: It was probably the trial I covered in Zambia [involving a drug to combat cryptosporidium, a diarrhea-causing infection]. It was stark, children dying, little kids dying. But from what I can tell if these kids had received antiretroviral therapy they could have survived. But they were put into a trial for a drug that never benefited them or their families or siblings because the drug was so completely targeted for other populations, almost a luxury drug for fighting an infection that in Western children means a day of diarrhea. It is so mild in kids who are healthy that lots of people don't even notice it.

So for such a minor condition they tested the drug on people who were so, so sick. And in the end, 12 kids died.

Kelly Hearn: You write that by the late 1990s, pharmaceutical companies had grown frustrated with the pace of academic hospitals and research centers, and changed the contracting focus to "contract research organizations," private companies that promise to get drug trials done quickly. What role do these companies play in the scheme of drug trials, and to what degree are they responsible for the growth in overseas trials?

Sonia Shah: There are two things, a push and a pull, that force trials overseas. The push is a patient recruitment bottleneck. Most trials don't meet recruitment deadlines, whether it's because Americans aren't interested or their profiles are wrong. Often the right kind of patients don't exist in enough quantity in the U.S., or if they do they drop out of trials.

The big pull is the contract research organizations (CROs). If anyone is a body hunter, it's the CRO industry, an industry that has largely escaped public notice, perhaps because of the weird, vague sounding moniker, CRO. Public Citizen called them, more accurately, "human experiment corporations." They are, though, just a business, and are not any more venal than other actors involved.

Hearn: Like you, many journalists and health experts I have interviewed almost invariably say the FDA should require new drugs to outperform existing ones rather than simply work better than a placebo. Given your sense of the FDA's ruling culture, the growing public frustration with drug companies, Washington's current political climate, and so on, is there real hope of this happening in the next few years?

Shah: I think not. But the history of regulation goes in fits and starts based on scandals, horrible mistakes like thalidomide, and then regulations change rapidly. And we can't predict disasters, something that will come into the limelight and expose a controversy, something that can change headlines. The FDA is vulnerable to headlines, to politics.

Hearn: What are the most dangerous structural impacts overseas trials can have on developing countries' health systems?

Shah: The main thing is misallocation of resources. You're talking about such a scarcity in terms of clinics, nurses, doctors, facilities, medicine, tools and time. You have places where all this is in short supply and in that setting they have this fruit dangled in front of them -- we'll pay you so many hundreds per patient, we'll give you new technology, new MRI machines, etc.

But what this means is that doctors and nurses there are performing experiments for treatments for things like diabetes, arthritis, erectile dysfunction. These things are important in the West but these people have malaria, cholera, and other infections. In that sense, the industry sponsored trials are distorting health care.

Part of a larger trend, as is happening in places like India that have and want more foreign trials, is the rise of privatized, two-tiered health care where high-tech facilities and highly specialized physicians are available for the wealthy, but the poor just have basic service that they have to pay for. In India and in South Africa, they are building hospitals not for people who live there but for foreigners. Doing trial business is part of the trend toward creating two-tiered systems in these countries, a private one for the rich and nothing for the poor.

Hearn: You talk about the phrase "due to ethical concerns" appearing frequently in biomedical conversations. You note that it is almost "exclusively reserved for biomedical transgressions." Can you explain?

Shah: It's just that you never hear it outside these circles it seems. If you're talking about something unethical, you don't say, "It's not possible due to ethical concerns." You don't say, "It's not possible to gas people due to ethical concerns." You say, "Such and such happened, and it was wrong, immoral and illegal."

Hearn: Rep. Tom Lantos of California said after the Washington Post's coverage of the Nigerian report that he will offer a bill making U.S. researchers give federal regulators details of tests planned in developing countries. What do you think of that idea, and what are some of the necessary regulatory changes for reining in the transgressions you address in the book?

Shah: I think it's a baby step in right direction. But most important, there needs to be restraints and breaks in the exportation of drug trials. It's not possible to put in enough oversight to protect these subjects, at the present time. Restraint is necessary. I was giving a talk at the FDA, and the regulators wanted to know what they can do to make it better. What about a new rule that says there should be an ethics committee review in this country and the country taking the trial? That's already true for NIH trials.

That would be good, but we know from NIH trials that lots of things fall through cracks, and that just requiring the ethics review is not sufficient. Another thing you could do is require verification of informed consent and really make sure people understand what's happening, that they fill out forms or take quizzes to show they understand.

Hearn: You put hope into the rise of the nonprofit drug companies. What are some of the key ways they can help?

Shah: I don't think it's wrong to do trials in developing countries. It's about what kind of drugs that are being developed. Are the drugs a public health priority? Those who take on the burden of experimentation should enjoy the fruits of research rather than watching the benefits go only to a tiny percentage of white, overweight bald men.

Hearn: Having now written about two of the world's most powerful interests, Big Oil and Big Pharma, what common themes emerge?

Shah: What's interesting to me is they produce commodities that are public goods. Society needs energy and medicine, but we let private companies do it for us. And their goals are to enrich shareholders. We need these things, but we decide the responsibility for providing it should go to for-profit entities. This develops all kinds of distortions.e

by Kelly Hearn, AlterNet. Posted June 9, 2006.

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