Pharmaceutical Company Bribes to Doctors: Criminal and Civil Liability

Pharma Company Bribes to Docs: The Legal Deal

So check this out: Big pharma companies sometimes try to get doctors to prescribe more of their drugs by straight up bribing them. I know, super shady right? This article will break down the laws around these bribes, what the companies and docs risk legally, and some real life cases where pharma execs actually ended up behind bars.

The Laws

There’s a few main laws that make it illegal for drug companies to bribe doctors:

• The Foreign Corrupt Practices Act (FCPA) – This law basically says American companies can’t bribe foreign officials. So if a pharma biz bribes non-US doctors, that’s a no-no.
• The Anti-Kickback Statute – This federal law makes it a crime to pay doctors or hospitals to refer patients or recommend products paid for by Medicare/Medicaid. So bribing them to prescribe drugs that will be paid for by these programs is illegal.
• State anti-bribery laws – Many states have their own laws prohibiting bribery of public officials or business associates. These can sometimes come into play with pharma-doc bribes.

There’s also civil liability meaning the pharma company could get sued for damages related to the bribes. And they may have violated antitrust laws too if the bribery stifled competition.

What the Companies & Docs Risk

If a pharmaceutical company is caught bribing doctors, here’s some of what they could face:

• Fines & penalties – We’re talking big money fines, tens or hundreds of millions of dollars potentially.
• Lawsuits – Patients, insurance companies, competitors could all sue for damages.
• Stock drops – Investors tend to bail when they learn about illegal bribes, causing share prices to plummet.
• Reputation damage – No one wants to take medicine from Shady McBriberson Pharmaceuticals.

And the doctors/hospitals/etc on the receiving end of bribes also face consequences like:

• Fines
• Loss of medical license
• Civil liability
• Jail time (yep, bribe-taking can be a crime too)

Real Cases Where Pharma Execs Went to Jail

Think bribery charges just mean a fine that pharma companies chalk up as the “cost of doing business?” Well in some cases, execs are learning the hard way that these bribes can land you in prison:

Insys Therapeutics

At this company, multiple top execs got charged with basically running a criminal bribery enterprise. The company was making a spray version of the crazy strong opioid fentanyl. Prosecutors said the execs set up a scheme to bribe doctors to prescribe it when patients didn’t need it medically.

The bribes took the form of speaker fees, jobs for doctors’ friends & family, lavish dinners, you name it. Some doctors made hundreds of thousands from these bribes. One nurse practitioner pocketed over $150k. Wild right?

In the end, the company’s billionaire founder plus 4 other top execs were convicted and sentenced to years in federal prison. The company also had to pay a $225 million fine. So those bribes definitely ended up costing more than they made.

Warner Chilcott

This one didn’t involve jail time but the fines were massive. Warner Chilcott got busted for basically bribing doctors by paying them bogus “speaker fees” to promote their drugs. Spoiler alert: the docs were not doing any speaking. It was just a way to pay them kickbacks.

All told, the drugmaker had to cough up $125 million to settle criminal and civil charges over these phony speaker programs. That’s a lot of “speaking fees!” Other companies like Novartis, Amgen, and Pfizer have gotten tagged for similar sham speaker programs too.

Purdue Pharma

You can’t talk pharma bribes without bringing up Purdue. This is the maker of OxyContin, which kickstarted the whole opioid addiction crisis. Though Purdue itself managed to mostly avoid prosecution, some top execs did end up with convictions.

Purdue’s president, top lawyer, and former chief medical officer pleaded guilty in 2007 to misleading regulators, doctors, and patients about Oxy’s addiction and abuse risk. Together they had to pay nearly $35 million in fines. Meanwhile the company paid out $600 million. Peanuts compared to the billions they made on Oxy.

Still, these criminal convictions represent some rare accountability on Purdue’s part. The company’s owners, the Sackler family, have somehow mostly escaped prosecution so far despite evidence they actively took part in pushing the “safe & effective” OxyContin myth.

The Bottom Line

While bribing doctors may seem like an easy way for pharma corporations to drive up sales, these companies and execs are increasingly finding out the hard way that these bribes can come with severe criminal penalties. Fines, damages, loss of licenses, even hard prison time in some cases! So next time a shady pharma sales rep offers a suitcase of cash and a vacation package to a doc, maybe remind them it’s not worth the orange jumpsuit.