10 Pharmaceutical Scandals That Will Leave You Fuming

When large amounts of money are involved, companies have proven to do whatever it takes to protect their profits, even if It’s unethical and illegal. The pharmaceutical industry is no stranger to illegal practices and scandals involving shady businesses, leading to more money. Some of the largest drug companies have faced backlash for price hikes, lying to the public and FDA, unsavory business practices, and misleading data. Here are ten of the largest pharmaceutical scandals.

Related: 10 Business Scandals So Big They Shook the Economy

10 Pfizer Celebrex Scandal

In 2012, pharmaceutical giant Pfizer was cherry-picking safety data for Celebrex. A lawsuit against the company revealed that research executives falsely represented data to fool the medical community about how effective the anti-arthritis drug was. The one-year study showed that Celebrex was no safer than other anti-inflammatory drugs. Still, the six-month data from the same study showed that the drug was safer on the stomach. Researchers promoted the six-month data to claim that the drug was superior to others, such as ibuprofen.

Documents revealed emails between researchers and executives that prove Pfizer officials used strategic decisions to make the data appear better. Celebrex was one of the most profitable drugs from Pfizer, but the company was forced to pay out more than $164 million to settle an investor class action lawsuit. The company still denied any wrongdoing.^[1]

9 EpiPen Scandal

The EpiPen has literally been a lifesaver for many people suffering from a deadly allergic reaction. The product only cost Mylan about $1 to manufacture an EpiPen two-pack, but the company took advantage of the vital product. They decided to raise the price from $100 to more than $600 for consumers.

In their first five years of owning EpiPen, Mylan spent almost $8 million in lobbying to make their product mandatory in schools, and soon it was permitted or required in most states. Then, they lobbied to make a law that gave financial incentives to states requiring EpiPen. Once the government was on the hook, Mylan continued to raise the price until it toppled $600.

An investigation was launched into the large price hike, but Mylan defended the increase due to improvements made to the product. Mylan agreed to pay $465 million to resolve claims that the company avoided paying rebates owed primarily to Medicaid by misclassifying EpiPen as a generic drug.^[2]

8 Merck Vioxx Scandal

Vioxx was a popular drug used to reduce pain and inflammation, and Merck, its manufacturer, had hoped to prove that the anti-inflammatory drug would reign superior over other similar drugs. The drug appeared to be doing its intended job, but studies revealed it was linked to an increase in strokes and heart attacks. The studies eventually led to a voluntary recall of the drug.

The FDA approved the drug in 1999 after data showed a low risk of cardiovascular illness. Studies then began showing the risks that Vioxx was having on patients, but Merck continued to claim that the studies were flawed. The FDA failed to act after seeing proof of the dangers the drug was causing, leading to rumors that Merck and the FDA were covering up potential health concerns. The disaster eventually led to fines and lawsuits.^[3]

7 Rochester Drug Cooperatives Opioid Scandal

The opioid epidemic centers on the rapid increase in abuse and overdose deaths attributed to drugs classified as opioids. Opioids are highly effective for treating pain, but they pose a risk of being addictive and could lead to overdose deaths. More than 600,000 Americans died from opioid use from 1999 to 2021. Pharmaceutical manufacturers and distributors were blamed by the government for their role in fueling the epidemic, and soon, they would pay for their roles.

Rochester Drug Cooperative (RDC), a pharmaceutical wholesale distributor, was the first to be accused of drug trafficking as part of the opioid crisis. They were accused of shipping massive amounts of highly addictive drugs to pharmacies that they knew were illegally dispensing them. RDC admitted to drug trafficking and was soon shut down and declared bankruptcy.

Laurence Doud, CEO of RDC, was later sentenced to 27 months in prison for his role in the crisis. The U.S. attorney claimed that Doud cared more about his paycheck than preventing opioids from making their way to people struggling with addiction.^[4]

6 Valeant Scandal

Valeant rightfully received anger from everyone over the dramatic drug price hikes at its firms, and this led to a federal prosecutor’s investigation into the way the company priced and distributed its drugs. The price of drugs such as Isuprel, Isoprenaline, and Nitropress was rising before Valeant purchased them, but they then boosted Isuprel by six-fold and Nitropress four-fold after acquiring them.

In 2016, former executives Gary Tanner and Andrew Davenport were charged with running kickback schemes, and they were accused of conspiring to set up Philidor as a place to distribute their drugs. Former CEO Michael Pearson was investigated for possible fraud earlier in the year. Valeant has always conducted business in a shady manner, and price gauging their customers was only a piece of the pie.^[5]

5 Questcor Price Hike Scandal

Questcor Pharmaceuticals is responsible for one of the largest drug price hikes in American history. Two whistleblowers from the company claimed that Questcor bribed doctors to increase sales of its drugs. The strategy was to help boost the sales of H.P. Acthar Gel, a drug that is known for treating a rare infant seizure disorder. The $40 vial of the medication in 2000 rose to around $39,000 in less than 10 years, almost a 97,000% increase.

The whistleblowers revealed that the company did everything from lying to the Food and Drug Administration to offering bribes if it led to more sales. The price increase led to more than $1 billion in annual sales for Questcor. About 25% of Acthar sales went through Medicare, and revenue from Medicare went from about $50 million in 2011 to $725 million by 2018. Not only were they hiking the price for individuals, but they were also robbing the government.^[6]

4 Merck MMR Scandal

The MMR vaccine protects against Measles, Mumps, and Rubella and is usually administered in two doses to infants and young children in America. The MMR vaccine by Merck has also quietly been part of a scandal for the past 25 years. Merck faced a potential product recall of the vaccine in 1999 because the product might have been defective. The problem arose when the FDA found a potency issue with the vaccine. The live virus in the vaccine that makes the shot work was dying off due to the vaccine sitting on shelves for too long.

Merck started “overfilling” by putting more of the virus into the vaccine to hope it would last longer, but the virus was still dying off too fast. The FDA hit Merck with two warnings for failing to report vaccine doses that might not meet potency requirements.

Lab workers for the company said they were told to change the date for it to look better. They ultimately filed a whistleblower lawsuit for taxpayer fraud. The case dragged on for years but was later dismissed before trial. Merck has denied any wrongdoing, but questions have been raised about whether the vaccine’s potency has led to outbreaks among vaccinated people.^[7]

3 Roche Fraud Scandal

Roche Pharmaceutical Group failed to properly report thousands of potential side effects that led to illnesses and death. The European Commission investigated allegations that the drug company failed to provide accurate details on the side effects of 19 medications. The initial reports showed that Roche could have been fined around $685 million for failure to report.

After years of inspections, the European Commission closed the case after Roche worked diligently to remediate the deficiencies quickly and enhance their medical compliance. Even though the outcome was expected to be worse for the company, thousands of deaths may still be linked to the company for hiding their side effects.^[8]

2 Abilify Scandal

Bristol-Myers Squibb Company and Otsuka Pharmaceutical Company were collaborative partners in the development and commercialization of Abilify, an antipsychotic medication used to treat conditions such as schizophrenia, bipolar disorder, and depression. An investigation by 43 states was launched to look into the marketing of Abilify for off-label uses. They alleged that Bristol-Myers Squibb promoted the drug for unapproved uses, especially for elderly patients with dementia.

A medication guide from Otsuka stated that the medication could produce an increased risk of death in elderly people with dementia. Bristol-Myers Squibb denied any wrongdoing, but they did agree to marketing restraints. The company also paid $19.5 million to settle the allegations that they promoted Abilify for unapproved uses and misled doctors about the potential dangers of the antipsychotic medication.^[9]

1 Pharma Bro Scandal

One of the most well-known pharmaceutical scandals involves the infamous and hated “Pharma Bro.” Martin Shkreli, former CEO of Turing Pharmaceuticals, was given the nickname after he was to blame for jacking up the price of medication. Daraprim was a medication that treated a rare parasitic disease that attacked cancer patients, AIDS patients, and pregnant women. The price of Daraprim rose from $13.50 a pill to about $750.

Shkreli said his decision to jack up the price was capitalism at work. Still, his choice sparked outrage all around America. In 2015, he was arrested on securities fraud charges related to hedge funds he was involved with, and the next day, he resigned as CEO of the company. He was convicted of the crime and was given a seven-year prison sentence. Shkreli was also ordered to return $64.6 million in profits that his former company gained by raising the price of Daraprim.^[10]