Facing Fines, Glaxo SmithKline to Stop Drug Promotion Excesses

UK drugmaker Glaxo SmithKline has said it would cease offering financial incentives to doctors to promote its products through speaking engagements, for example. The company also will stop linking remuneration of its sales representatives to the number of prescriptions generated. Starting from the beginning of 2015 it also will no longer pay healthcare professionals to attend medical conferences.

For years, the pharmaceutical industry has been widely criticized for such practices. The volte-face at Glaxo SmithKline comes on the heels of criminal proceedings launched by the U.S. government earlier this year.

In what is believed to be the largest fraud settlement ever, the company agreed to pay $3 billion in fines and plead guilty to federal charges stemming from kickbacks and other missteps, including marketing the depression drug Paxil to children and teenagers and using fake advisory boards to promote the depression drug Wellburtin as an option for weight loss and as a remedy for sexual dysfunction and substance addiction.

The federal prosecutors said the drugmaker also sponsored dinners and spa programs and at the same time submitting incorrect prices for pharmaceuticals to the government. This allowed it to underpay rebates to government-funded programs such as Medicaid. Glaxo SmithKline also stands accused of failing to report data about the cardiovascular effects of its diabetes drug Avandia to the FDA.