On Sunday, January 2, 2010, 60 Minutes start the year off with the sensational story of Cheryl Eckard, the GlaxoSmithKline whistleblower whose courage and persistence led to one of the largest “qui tam” cases ever against a corporation for defrauding the government.
Cheryl’s job, as manager of Glaxo’s global quality assurance, “was to inspect plants to make sure that the drugs had the right ingredients, the right potency and met government standards for purity.” In fact, she was sent in because an FDA inspection had already seen problems as this plant (noting that “FDA inspections of drug plants are only occasional, so it’s up to drug companies to police themselves” – which is why litigation is such a critical backup.) But as 60 Minutes put it, Eckard “found much more than the FDA had.” For example,
[T]he employees were contaminating products, including the anti-bacterial ointment Bactroban, which was made in a sealed tank to prevent contamination.
“They were opening up the lid and then they were sticking their body into the tank and scraping it with like a paddle,” Eckard said.
“But this product is supposed to be free of bacteria. Why would they do that?” Pelley asked.
“It saved money,” Eckard replied.
As her team continued its evaluation of the plant, Eckard says she discovered something much worse than contamination: because of failures on various production lines, she says that powerful medications were getting mixed up.
“Are you saying that different kinds of drugs were packed into the same bottle?” Pelley asked.
“Yes. And that’s shocking,” she replied.
Cheryl warned and pleaded and warned and pleaded with her bosses to shut this plant down. Then she was fired. And then, she found some great lawyers:
This case goes right to the heart of patient safety,” attorney Neil Getnick told Pelley.
Getnick and Lesley Ann Skillen are Eckard’s lawyers. And under the federal whistleblower law, they filed suit on behalf of the federal government claiming that Glaxo had defrauded the taxpayers.
Asked how this is fraud against the U.S. government, Getnick said, “Pharmaceutical drugs are paid for by our Medicare program for the elderly, by our Medicaid program for the impoverished. And here we have a situation where hundreds of millions of dollars were paid for adulterated drugs through our Medicaid programs.”
Glaxo pleaded guilty to a felony. It admitted it distributed “adulterated drugs Paxil CR, Avandamet (a diabetes drug), Kytril (a drug given to cancer patients), and Bactroban.” All together, the company paid $750 million to settle the criminal conviction and Eckard’s suit.
Check out the sleazy response by Ian McCubbin, senior vice president at Glaxo in London: “I don’t know Cheryl Eckard. And I don’t know all the details of her accusations.” Could it happen again? “I absolutely hope not,” he replied.
