Abbott and Bayer Take Another PR Hit

February 1, 2002
Kevin Gopal
Kevin Gopal

Kevin Gopal is Pharmaceutical Executive's international correspondent, covering pharma and regulatory issues around the word. He is also a political columnist for North West Business Insider, one of the UK's leading regional business magazines. He started his career as a journalist at SiYu, the UK's Chinese community magazine, before joining the PE staff.

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Washington DC-Abbott Labs and Bayer made Multinational Monitor's 2001 list of the ten worst corporations. The Washington-based magazine was founded by consumer activist and one-time US presidential hopeful Ralph Nader.

Washington DC-Abbott Labs and Bayer made Multinational Monitor's 2001 list of the ten worst corporations. The Washington-based magazine was founded by consumer activist and one-time US presidential hopeful Ralph Nader.

Abbott made it into the annual ranking after TAP, its joint venture with Takeda, was forced to pay $875 million in criminal charges and civil liabilities for Medicare reimbursement fraud.

Bayer's inclusion is a result of what the publication says is an overcharging of the US government for the antibiotic Cipro (ciprofloxacin) used to treat anthrax. The magazine also criticizes the German company for "dangerous peddling of antibiotics for poultry, contributing to antibiotic resistance among humans," as well as its harassment of a corporate accountability group.

The two pharma companies find themselves in the illustrious company of Argenbright, Coke, Enron, ExxonMobil, Philip Morris, Sara Lee, Southern Company, and Wal-Mart. Argenbright, the security company, was included for repeat violations of regulations that helped convince Congress to federalize US airport security operations. Coca Cola was named for its sponsorship of the Harry Potter movie, "using a children's favorite to hawk its unhealthy product," and for alleged complicity with Colombian death squads in targeting union leaders there.

"These behemoths have ripped off the public, polluted the environment, abused their workers, and debased our culture," says Robert Weissman, editor of Multinational Monitor. "They appear in our lives everyday, disguised as 'respectable members of the community.' They deserve public opprobrium, and, in many cases, government sanction."

TAP was fined to settle charges that it had contravened the Prescription Drug Marketing Act by offering unsuitable incentives to doctors to prescribe the prostate cancer medicine Lupron (leuprolide) and for giving doctors free samples of the product for which they then claimed Medicare reimbursement. Blue Cross and Blue Shield of Massachusetts have filed suit against TAP to recover those payments. The settlement was the largest ever in a healthcare fraud case. Many industry watchers believe the authorities will now extend their investigations of Medicare fraud to other pharma companies.

In agreeing to settle, Thomas Watkins, president, said: "We fundamentally disagree with many of the government's allegations, but we resolved this matter to make clear our commitment to proper and ethical business practices and to avoid protracted legal battles and ensure uninterrupted availability of Lupron for thousands of patients who rely on it."

He says the company has made several changes to its practices, including mandatory annual training for all employees about fair and ethical business practices, the appointment of an executive-level ethics and compliance officer, the linking of employee incentives to adherence to the company's code of conduct, and strengthened disciplinary procedures.

Abbott sources point to a number of awards last year that they say show a different side of the company. Working Mother named Abbott as one of the best for helping women balance work with home lives. In the last four years, Abbott has increased the number of women in its management ranks by 72 percent.

Also, Fortune named Abbott one of the top 50 companies for minorities four years in a row, and Chicago recognized it as one of the best employers in the city.