As you suggest, criminal cases against pharma companies as companies (as opposed to individual employees) have been extremely rare over the years. Most that have occurred have been triggered by whistleblowers; most notably, the Neurontin off-label case of a few years ago, in which Pfizer (which had acquired Warner-Lambert) ended up paying $430 million in civil and criminal penalties. Ironically or not, Neurontin sales only continued to grow after the convictions, so from a “cost of doing business” perspective, it was probably a wash (at worse).

As far as “failure to warn” convictions, there are virtually none in the past twenty-five years. The most egregious probably go back to the 80s and concern the drugs Oraflex and Selacryn. The Justice Dept. decided not to pursue “intent,” and so there were very small fines for misdemeanor rather than felony fraud in both cases. From the perspective of many of those involved, there was little question that the unreporting of fatalities in pre-approval trials was no “accident.”

This issue ties to the question of FDA preemption since those who argue for it often say that companies that commit fraud or the like will still be accountable to the FDA/Justice Dept. even if not to civil action. That leads to the obvious question of how often, in fact, have companies ever been so held accountable.

Answer: Almost never.

This is the bottom line. With Zyprexa, the side effects have been known for years, but Lilly’s all out effort to block that information from being made public is a huge problem. Trust of drug companies is at an all time low. The ball is in their court to correct that image, which can only be done with complete disclosure of risks.

Companies that play by the rules have very little to fear. Consumers have a great deal to fear from companies that do not.

The history of both regulation and civil liability (as I read it) suggests that consumers’ confidence in those safeguards (and disincentives for delinquency) has been very good for companies’ bottom lines. Preemption, on the other hand, is a DTC ad that says “We can’t be trusted.”

Re: the industry as a whole, I don’t agree with that conclusion. But I think that’s how it plays.

In other words, it is one of the best cases recently that argues against “FDA preemption.”

Ask yourselves how long it might have been before Lilly changed Zyprexa warnings if there were no lawsuits whatsoever, and we were entirely dependent on waiting for action by the FDA . How long would that have taken?

I don’t think a reasonable person could answer other than, “till Kingdom come.”