Pharmaceutical Giants Philidor and Valeant's Executives Arrested for Fraud

Pharmaceutical Giants Philidor and Valeant's Executives Arrested for Fraud

    On November 17, Andrew Davenport, chief executive of Philidor Rx Services, and Gary Tanner, an executive at Valeant Pharmaceuticals, were arrested on charges of fraud. The arrests were made after it was revealed that the two companies had been engaging in a relationship that crossed the lines of legal business: Philidor, a mail-order pharmacy, had been giving kickbacks and bribes to Valeant in exchange for using its services over those of market competitors. The partnership took Philidor from a small start-up to a company making tens of millions of dollars in only two years. The complaints spurned from the documentation that “at least 90 percent of the drugs it dispensed were sold by Valeant.”1

    The investigations from Congress and the Securities and Exchange Commission of this recent development will only add to the list of inquiries over the ethics of Valeant’s practices. The company is already under federal investigation for similar revenue inflating methods in the fields of drug pricing, distribution, and patient assistance.2

 

References:

1. Katie Thomas and Matthew Goldstein, “Former Drug Industry Executives Charges in Kickback Scheme,” NY Times, last modified November 17, 2016, http://www.nytimes.com/2016/11/18/business/valeant-philidor-fraud-kickback-scheme.html?hp&action=click&pgtype=Homepage&clickSource=story-heading&module=first-column-region&region=top-news&WT.nav=top-news&_r=0

2. Caroline Humer and Svea Herbst-Bayliss, “Valeant says Philidor pharmacy shutting down as it cuts ties,” Reuters, last modified November 17, 2016, http://www.reuters.com/article/us-valeant-pharmacies-idUSKCN0SO12W20151030

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