International Issues -
As GlaxoSmithKline PLC settled claims (paying over $70 million) for cheating the Government-run health programs and general public by inflating drug prices in the US, the shady practices of pharmaceutical companies have surfaced. These claims are related to highly overstated average wholesale price used by the drug companies to seek reimbursements from the government sponsored health programs. It was alleged that Glaxo gave discounts to the doctors, who then claimed reimbursements from the government at the inflated price. The price manipulation is alleged to affect senior citizens undertaking medication for serious illness. Similar lawsuits have been filed against companies like the Abbott Laboratories and Wyeth in California and also against 42 companies in Arizona. In California alone, the companies have alleged to have cheated the exchequer a whopping $27 billion. The complaint notes that in 1998, Abbott over-priced a particular drug (Ven-A-Care) by 752% ! As per Congressional research, seniors constitute 12% of Americans and use 37% of the prescription drugs and they pay 174% higher prices then the rest of the world! Clearly, these companies then can’t be let-off by paying a pittance of $70 million.