Big Pharma Corruption

Big Pharma Corruption

"How does Big Pharma engage in corruption?"

Big Pharma CorruptionLarge pharmaceutical companies like Pfizer, Merck, Johnson & Johnson, and Moderna ("Big Pharma") lead the US healthcare industry, which accounts for 18% of the US economy (GDP) and comprise its largest sector. While Big Pharma wants the public to believe that it works tirelessly and spends a fortune to discover and develop new drugs, in reality most of the new drugs are discovered and developed at taxpayer-funded public institutions. Big Pharma swoops in thereafter to take them through the FDA approval process, patents them, and then sells them at unconscionably high prices to the people who paid for the drug to be discovered: the taxpayers.

Big Pharma's business model is built on corruption. Its exorbitant profits are used to pay off everyone in the value chain, including in the 14 ways below, to maintain its grip on which drugs get approved and denied so that the exorbitant profits continue to flow.

1.  Pays off key lawmakers

Big Pharma spends over $400 million every two years, more than any other industry, to (re-)elect U.S. Senators and Representatives who do its bidding. Of the 20 Senators and 20 Representatives who received the most campaign money from Big Pharma from 1999 to 2018, 39 sat on committees with jurisdiction over health-related legislative matters, 24 of them in senior positions (source).

2.  Gatekeeps new drug/vaccine trials

To win FDA approval, new drugs and vaccines must pass through Phase 1, 2 and 3 trials, the "gold standard" of which is the large-scale randomized double blind placebo control trial (neither the subject nor the administrator knows if the subject is receiving the placebo or the drug/vaccine being tested), which cost upwards of $20 million. Since only Big Pharma has that kind of money to risk and only expensive patented drugs have the potential to recover that cost, Big Pharma gatekeeps which drug or vaccine candidates go through the gold standard on their way to the FDA for approval. In particular, it is virtually impossible for a cheap generic off-patent drugs to go through such a trial because they will not generate enough profits to recover the $20 million trial cost.

3.  Pays off drug trial investigators

As the NIH budget for new drug trials continues to be reduced, Big Pharma now funds the overwhelming majority of new drug trials, and is happy to do so since it can choose the investigators, statisticians, scientific writers, etc., who know not to bite the hand that feeds them, and therefore design, manage and write up the trial to make Big Pharma's drug seem better than it is.

To make it seem safer than it is, they may enroll as subjects only healthy people with strong immune systems who will tolerate the side effects better than those who represent the general population, which includes people with weak immune systems. To make the drug seem more effective, they may switch the end points - the outcome that can be measured (e.g., death rate, hospitalization rate, hospitalized days, etc.) - from those that were targeted to whatever portrays the drug in a more positive light, while not reporting the negative details in the results.

On the other hand, if a trial is commissioned by Big Pharma or its surrogates on a cheap generic drug that competes against one of its drugs or vaccines, that trial is designed to show a negative outcome. For example, the trials commissioned by Big Pharma and its surrogates on Ivermectin have used a dosage that is too low, a dosing duration that is too short, a dosing start date that is too late (Ivermectin blocks viral replication, which in the case of SARS-CoV-2 takes places during the first 5 days after infection), and/or choose a region where Ivermectin is already in wide usage (since the placebo group already has been exposed to Ivermectin as well, the positive results from the Ivermectin group will not be statistically significant compared to the placebo group's results: source).

If a cheap generic drug still shows efficacy, Big Pharma simply pays off the key people and institutions to have the conclusion changed. One of those people admitted taking $40 million to kill 504,000 people.

4.  Pays off medical journal editors.

After a drug trial has been conducted, publishing its results in a prestigious medical journal enhances its chance of FDA approval. By far the largest advertisers in medical journals are Big Pharma, which bought $637 million worth of advertisements in them in 2016 alone (source). Big Pharma also showers cash on the editors of medical journals. A 2017 study of 52 medical journals found that over 50% of their editors had been paid by Big Pharma to the tune of $175,239 on average in just one year, usually as fees for speeches, "consulting," royalties, or luxury travel (source).

In return, medical journal editors readily accept drug trial article submissions from Big Pharma. When they receive article submissions for drugs that could threaten Big Pharma's drugs, however, they either decline to publish them or demand that the authors makes changes in the article that cast the drug in a less positive or a more negative light, as a condition for publication.

5.  Pays off FDA advisory panel members

Before a new drug or vaccine is approved by the FDA, it is discussed and voted on by an advisory panel of "independent" doctors. While the result of their votes is not legally binding, the FDA in almost all cases approves or denies the new drug or vaccine candidate according to the result of their votes.

To serve on the advisory panel, doctors must declare that they have no financial conflict of interest concerning the drug or vaccine candidate. After the vote, however, those who argued for approval and voted to approve new drugs or vaccines made by Big Pharma are rewarded with exorbitant consulting fees, speech fees, luxury travel, etc. A 2018 investigation of 107 doctors who served on the FDA advisory panels from 2008 to 2014 found that 66 (62%) of them had received such subsequent pay offs, including 20 who received between $100,000 and $1 million, and 6 who received over $1 million (source). Since the votes to approve new drugs or vaccines are seldom unanimous, a 66% pay off rate points to the Big Pharma paying off the vast majority if not all of the doctors who vote to approve its drugs and vaccines.

6.  Pays off employees to become regulators

Big Pharma executives who resign to take up high-level positions at the FDA, NIH, CDC or another government entity from which they can help their former employers are given (multi-)million dollar golden parachute payments that are not given to executives who resign without heading to such positions.

7.  Pays off regulators when they resign

The general public assumes the Food and Drug Administration (FDA), National Institutes of Health (NIH), and Centers for Disease Control and Prevention (CDC) must be staffed by America's top medical minds who are passionate about safeguarding Americans' health, but that is not the reality. The FDA, for example, is located in Maryland's Rockville, the 18th most expensive suburb in America where the median home price is 46% above the national average. Yet, because the positions at the FDA pay only about 80% of their counterparts in the private sector, they are staffed mostly by people from out of the area who tried but couldn't get those private sector jobs. They tend to be foreign born and trained, speak English as a second language, and work off of checklists that are given to them. Their superiors who create those checklists, meanwhile, do the Big Pharma's bidding, then wait for their big pay day, which comes when they get the call to resign and join them as senior executives or board members. Scott Gottlieb, for example, resigned as the FDA Commissioner in April of 2019. By June of 2019, he was sitting on the boards of three pharmaceutical companies he had been policing until just two months prior, including Pfizer, which in 2020 paid him $338,587 for occasionally attending its board meetings, as well as influencing his former subordinates at the FDA. The former FDA Commissioner now sits on the boards of six such companies, each of whom contribute to his pay day. Likewise, after years of aggressively promoting vaccines, CDC Director Julie Gerberding resigned in 2009 to become the president of Merck's vaccine division.

8.  Pays off regulators before they resign

American tax payers are the employers of our health regulatory agencies' employees, yet when their work that we funded leads to a patent, they - our employees - personally keep and receive royalties on the patent, while we - their employers - ultimately pay those royalties on a patent that should belong to us in the first place. When a regulator receives a patent that could earn them millions of dollars if it is licensed and leads to a profitable new drug, their focus flips from policing Big Pharma to getting it to license their patent and helping the new drug get approved. To align the regulators even more closely to its own interests, Big Pharma even shares patents with regulators. For example, Moderna shares the patent on its mRNA COVID-19 vaccine with these six employees of the Anthony Fauci-led National Institute of Allergy and Infectious Diseases (NIAID) of the National Institutes of Health (NIH), and pays each of them a royalty of $150,000 per year:

NIH mRNA Vaccine Patent Holders

9.  Pays off the media

James Smith Pfizer Board MemberPfizer identifies Board Member James Smith as one of "Our Experts" (photo) and has paid him more than $2 million over the past 6 years (source) for occasionally attending its board meetings. Peculiarly, James Smith has no expertise or background in healthcare and his highest earned degree is a bachelors. He is, however, the Chairman of Reuters, the news organization whose self-appointed "fact checkers" collaborate with Facebook and Twitter to determine whose posts, tweets and accounts get deleted (source). Pfizer is paying Smith millions of dollars to assure favorable (social) media coverage of its drugs and vaccines, unfavorable coverage of cheap generic drugs that compete against them, and to silence any news of the latter's efficacy.

Even without such payoffs, since patented prescription drug advertisements comprise the single largest product category of advertising revenues (8% of the total) for media companies, they are careful to provide favorable coverage of Big Pharma's patented prescription drugs and vaccines, and unfavorable coverage of cheap generic drugs that compete against them. And Alphabet - the parent company of Google and YouTube, both of which have been suppressing the news of Ivermectin's efficacy against COVID-19 - also owns 12% of Vaccitech, the company that created the COVID-19 vaccine for AstraZeneca and receives a royalty on its sales.

10.  Pays off doctors

Big Pharma gave $979 million in 2016 (source) and over $1 billion in 2020 to doctors in the US as exorbitant speaking fees, luxury travel, meals, etc. Most of the billion dollars did not go to recent medical school graduates; it went to medical directors of hospitals and other decision makers who set the policies that the junior doctors must follow. The money flows if they use Big Pharma's patented, expensive drugs but dries up if they use cheap generic drugs (see The real reason hospitals refuse to use Ivermectin).

11.  "Evergreens" patents

If a patented drug continues to generate exorbitant profits as it nears the end of its 20 year patent protection, Big Pharma introduces a minor change to it, even as minor as adding a stripe the the pill, claims it has become materially different, and greases enough palms as above to patent it for another 20 years, a dubious practice known as "Evergreening." For example, when the patent on the heartburn and ulcer drug Omeprazole expired in 2001, AstraZeneca rotated the molecule to create its mirror image, named it "Esomeprazole," and patented it for another 20 years. Seventy eight percent of all new drug patents awarded from 2008 to 2018 were to drugs that already existed (source). Since many drugs that win FDA approval and are patented still fail commercially for lack of efficacy or are withdrawn later when hidden side effects come to light, virtually all patented drugs that continue to generate profits are being evergreened so that they can continue to be sold at exorbitant prices. Fifty percent of the best selling drugs have been evergreened more than once (source).

12. Pays off competitors

Instead of competing to offer better drugs for lower prices, Big Pharma has been buying each other to limit competition and then raising prices. Between 1995 and 2015, 60 pharmaceutical companies merged into just 10 (source). The three makers of insulin among them - Sanofi, Novo Nordisk, and Eli Lilly - raised their prices for insulin 168%, 169% and 325%, respectively, over a period of just 5 years, from 2010 to 2015 (source).

13.  Pays off potential competitors

When a new drug developed by a small firm shows promise through the clinical trials and could threaten its cash cow drugs if approved, Big Pharma buys its maker and quietly kills off the drug. Such "killer acquisitions" account for about 7% of all mergers and acquisitions in the pharmaceutical industry (source).

14. Pays off pharmacy benefit managers

Pharmacy benefit managers ("PBMs") are agents of private and public health insurers who receive a fee from them to negotiate lower drug prices on their behalf from Big Pharma and to advocate cheap generic versions of expensive, branded drugs. Big Pharma pays massive "rebates" - i.e., kickbacks - on the total dollar sales to PBMs and has arranged for them to legally keep those kickbacks without disclosing their amounts, so PBMs steer their insurer clients to Big Pharma's expensive patented drugs instead of their cheap generic equivalents. This corruption of PBMs is estimated to amount to as much as 50% of the list price of insulin, which costs 600% more in USA than in Europe, where the governments negotiate directly against Big Pharma (source).

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