Monday, November 22, 2010

From Health Care Renewal: Drug CEO Suffers Consequences, Sort Of

Over on our friends Health Care Renewal blog appears this story:

An issue this blog and theirs have both been concerned about is the fact that when wrongdoing, even criminal wrongdoing occurs within the drug industry (as well as in high places in academia), no individual ever appears to suffer any negative consequences to his/her career, and whatever monetary fine is imposed seems to be blown off by the company as simply a business expense.

So it was in fact a real breakthrough when the Feds banned Marc Hermelin of KV Pharmaceuticals from doing any business with them for 20 years, over a criminal act of negligence involving safety reporting. He had been fired as CEO in 2008 and now resigned from the Board.

That's part of the story. It turns out that KV is not exactly free of Hermelin's influence after all. His son and grandson remain as board members and his family still owns 52% of the company stock.

So we seem to have two lessons here--first, that maybe at long last the government is getting serious about enforcing the law with drug execs; and second, that when you have enough money and power you can find a way to hang onto both much easier than we commoners can.

No comments: