What did Larry Page know and when did he know it? Well, the US Department of Justice says that Google ceo Larry Page knew for years that online Canadian pharmacies were allowed to place ads that targeted US consumers and, ultimately, caused medicines to be imported illegally,The Wall Street Journal writes. Google, you may recall, last week agreed to forfeit $500 million ( read here).
"Larry Page knew what was going on," Peter Neronha, the Rhode Island US Attorney who led the investigation tells the paper. "We know it from the investigation. We simply know it from the documents we reviewed, witnesses that we interviewed, that Larry Page knew what was going on...Suffice it to say that this is not two or three rogue employees at the customer service level doing this on their own. This was a corporate decision to engage in this conduct."
In reaching this conclusion, the feds reviewed more than four million documents, including internal e-mails, showing Page, 38, was aware of the ad sales, although the paper writes the e-mails will not be released. The feds did not name Page or other execs last week when Google confessed to the improper activity and Neronha says there are no plans to prosecute them. Interestingly, Google has still not placed a press release on its web site with its mea culpa.
Shipping meds from pharmacies to US consumers from other countries usually violates federal law, including the Controlled Substances Act. And the issue has generated considerable attention from the FDA and the pharmaceutical industry, which wants to eradicate importation, citing safety concerns over manufacturing and shipping, as well as counterfeit meds.
The feds say Google knew it was potentially violating US law since at least 2003, but did not take sufficient steps to ban such ads until an undercover sting operation was employed against Google two years ago. Until then, Google execs testified repeatedly in Congress that they had rigorous controls to stop unlawful ads, including third-party services for screening sites, the paper writes.
But Neronha tells the Journal that was "window dressing" that allowed Google to continue ringing the register while making the right noise about taking action. Meanwhile, he adds that Google employees helped undercover Justice Department agents in the sting operation evade controls designed to stop companies from advertising illegally.
12 Comments
"Shipping meds from pharmacies to US consumers from other countries usually violates federal law"
This is protectionism.
"There are no plans to prosecute them ..."
OK - does that make the $500 Million USD a payment in consideration of future services (not) to be rendered? Or just a very large insurance premium?
Either way, I do suppose it will help the defecit.
I'm shocked but not surprised. Google is an evil company
Not to throw a wrench into things but we have small biz and individual insurance plans here in my state that do not have prescription drug coverage. In addition, some of the donut hole Medicare Part D recipients run into problems now that reps and samples are more limited. Also, the pharmaceutical company programs are often too restrictive or very complicated- too complicated for an elderly, disabled or even able bodied person to understand. Also, there are a lot of drug shortages and sometimes, this also plays a factor in buying overseas.
In one recent case, the shortage was due to manufacturing and safety issues on the part of the pharmaceutical company. Patients started buying their medicine over the internet from Canada and Thailand or trying over the counter patches to stretch out their supply of medicine.
I have also seen instances where patients turn to vetinary medicines.
To these people, this is about survival and not about whether or not something is legal. Sometimes, the only way that patients can afford the time and price for a medically necessary medicine is by buying it from overseas.
So, is Google capitalizing on this or is it just business and are they doing it a more responsible way than other companies? What about the other gaps that play a part in driving people to order medicine over the Internet?
These type Dept of Justice settlements (including pharmaceutical industry and Wall Street settlements) signal to big corporations that it is okay to push the legal and regulatory envelop and even intentionally ignore the law, but if you get caught your company may have to pay a fine. This creates a big company mentality that illegal activity is fair game and if you get caught the company may take a financial hit but that will just be "a cost of doing business." What you get away with will easily cover those costs.
Reminds me of the lax and hand slapping FDA enforcement of advertising and promotion in the 1990's which led many in the pharmaceutical industry to "push the regulatory envelop" to a point where it was almost accepted practice and at worse "a cost of doing business."
Just a word of caution here, however. The ability to pay your way out of illegal corporate activities doesn't necessarily apply to small businesses or individuals acting outside the protections of a large corporation. www.PharmaReform.com
If precedent means anything Larry Page ain't losing a wink of sleep over this. Why?
1) The greatest pioneer of the digital age, Steve Jobs said in a 2004 interview that Apple received at least one lawsuit against it every day while he was running the company. He probably stopped counting after awhile.
2) The entire weight of the United States Justce Dept couldn't destroy Microsoft and Bill Gates despite years of efforts.
If Page has the steel spine of a Jobs or Gates I'm sure that he's already turned it over to the lawyers and told them to wake him if it's anything important.
I think the congress has to change the law. It is true that the law is to protect consumers (although FDA only reviews what the drug companies find and report to the agency) but the drug companies are using this law for business purpose rather than the spirit of the law. Problem is that the drugs claimed to be coming from Canadian Pharmacy are really manufactured in Southeast Asia and shipped from that region. This is the substandard quality that is being imported. Otherwise Canada has as much control on quality of drugs as the FDA, Today ICH is setting the global regulatory rules for drug manufacturing and FDA is adopting the guidelines. So the law has to change and allow importing drugs from countries that follow ICH rules. This practice not only solves problems of drug shortage but also sets a condition for fair competition and brings the drug price to its fair level.
ABK: OK up to a point, but the problem is: Regulators follow ICH rules but companies don't, and counterfeiters don't follow any rules at all. Pursuade your regulators to shut down the fakers and we will import your products.
cliffintokyo: You point is also well taken. The role of regulatory agencies in each country (e.g. the FDA in the US where I live) is to ensure companies that market the drug follow the rules. This is their job. Crooked companies always will be there. Counterfeit and adulterated drugs are the toughest issues the agencies are fighting. But this has nothing to do with my point. My point still valid and can work for the consumers and drug companies. This is the role of ICH and eventually will be adopted (remember 20 years ago the FDA did not want to speak with ICH, now is one of the members).
P.S. who is "we" and who are "my regulators"?
Canada has said that they cannot and will not police our medicines. FDA has said that they cannot insure the safety of these medicines. Americans clamor for medicines and will go to great lengths to obtain them.
I was talking with someone about this post yesterday, and we were joking that if you commit a felony and are sent to jail, it is considered cruel and unusual punishment to be denied access to medically necessary care. If you comply with and try to work within the confines of the medical and insurance system, the patient might be put through a legal proceeding and forced to prove that the medicine and/or dosage of medicine that their doctor prescribed and pharmacist dispenses is medically necessary. In addition, if you have a state overseen small business or individual health insurance plan, under our state's new health care reform initiative you might wind up in a high risk pool and forced to pay additional premiums.
So, while you have little to no control over illegal internet dispenses of counterfeit drugs or substandard drugs, and little to no control over the drugs and pricing that your PBM/insurer negotiate, it seems like the bad actors who illegally dispense counterfeit and sunstandard drugs over the Internet and your PBM/insurer have a lot of control over you.
In certain instances no matter what the patient or the FDA does, they get put in the middle, and forced to act like or defend themselves against being miscast as 'the bad guy'. As for the new state HCR initiative I seem to recall that state legislators, elected officials and appointees are all exempt from a lot of the now revoked consumer protections. I wish that they would realize that no one is exempt from the potential and actual harm caused by illegal Internet drug dispenses.
if I buy a generic drug on-line from China(and I can still do that right now) and I have an adverse event, I should be able to hold the original manufacturer responsible, right?
I know a little bit about this case since our company, PharmacyChecker.com, was named in the non-prosecution agreement and I was subpoenaed as a witness.
To address the specific topic of this post, the question should be what exactly did Larry Paige know? So what if he knew that good Canadian pharmacies were advertising to Americans on Google. I don't mean the rogue sites but ones that are licensed and require a prescription and help Americans afford their medication. For some badly needed perspective: As Governor of Kansas, our current Secretary of Health and Human Services, Kathleen Sebelius, created a government website that linked Americans to Canadian and other international pharmacies, knowing that the FDA opposed the action. Apparently she thought it was safe and legally okay: http://www.commonwealthfund.org/Innovations/State-Profiles/2005/May/I-SaveRx--States-Facilitate-Rx-Reimportation.aspx.
If Page knew about rogue pharmacy sites advertising on Google and that, as reported in the DOJ settlement with Google, allowing them was intentional, then that’s really bad. Don’t assume that he did. The government isn’t bothering to make the distinction between whether he knew about good Canadian pharmacies or rogue pharmacies, and Larry appears legally bound not to defend himself. The branding or, comically, I should say "misbranding" of all Canadian online pharmacies by FDA/DOJ as bad or “unsafe” is plain out wrong. First of all, the $500 million was not assessed for regular prescription medication advertised and personally imported, but for "controlled drugs". Journalists are missing this left and right. Apparently the government wants people to believe the fines were handed down for ALL, what they consider to be, advertising on Google and sales "related" personal drug importation: but it was just for controlled substances. Second, it's well known that reputable Canadian online pharmacies don't sell controlled medications to Americans. Third, studies show that properly verified non-US online pharmacies, most based in Canada, sell genuine medication and require a prescription. See this government website for that study: http://www.ncbi.nlm.nih.gov/pmc/articles/PMC2921371/. Maybe Larry Paige read this GAO report in 2004 that found Canadian online pharmacies could even be safer than U.S. online pharmacies: http://www.gao.gov/new.items/d04820.pdf.
While it’s important what Larry did or didn’t know; it’s more important that the media report on how this action by the government is not simply to punish Google for wrongdoing but, I believe, to help the pharmaceutical industry stamp out safe personal drug importation from reputable AND affordable Canadian online pharmacies. The 48 million Americans who did not take their medication last year due to cost (Source: Commonwealth Fund) deserve at least that much. Maybe that’s what Larry thought when Google’s policies were first drafted.
Gabriel Levitt Vice President PharmacyChecker.com