Pharmaceuticals Anonymous

Wednesday, March 9, 2011

Bonkers: Sell Eli Lilly stock now

Coming in 2011: The end of Eli Lilly as we know it.
Urgent message to Lilly shareholders: Sell now.

"No country can afford not to have periodic showcase prosecutions of serious corporate abuses to foster deterrence.
          – John Braithwaite, Corporate Crime in the Pharmaceutical Industry (Routledge, 1984)

To prepare for the drama that's about to unfold, here's a little history.

On Jan. 30, 2009, Eli Lilly and Company pleaded guilty to a violation of the Federal Food, Drug, and Cosmetic Act (FDCA). The Court sentenced Lilly to pay a criminal fine of $515 million and asset forfeiture of $100 million, the largest criminal fine imposed against an individual defendant in the history of the United States.

The Government believed this historic criminal fine reflected the seriousness of the offense and Eli Lilly's earlier violations of the FDCA. The Government believed the criminal fine would promote respect for the law, and that the sentence would deter Eli Lilly from further unlawful promotion of its pharmaceutical products. The Government believed a criminal fine of this magnitude would serve as general deterrence to others who might be tempted to go down the road of off-label marketing.

Under the Corporate Integrity Agreement (CIA) between Lilly and the U S. Department of Health and Human Services, the parties agreed that Eli Lilly would not be placed on probation. However, the agreement imposed a strict compliance program to ensure that Lilly's criminal conduct would not recur.

Eli Lilly is subject to exclusion from Federal Health Care programs, including but not limited to Medicaid, for a material breach of the CIA. A material breach includes failure by Lilly to report a reportable event and take corrective action. A reportable event means anything that involves a matter that a reasonable person would consider a probable violation of criminal, civil, or administrative laws applicable to any Federal Health Care program and/or applicable to any FDA requirements relating to the promotion of Lilly products.

The CIA applies to Eli Lilly employees and all contractors, subcontractors, agents and other persons who perform promotional and product services on behalf of Lilly.   Exclusion will have national effect and apply to all other Federal procurement and nonprocurement programs.

Shareholder lawsuits filed against the company for engaging in a long list of illegal activities were settled in March 2010, with Lilly agreeing to abide by strict new measures guaranteeing that matters affecting patient safety and benefit shall be of paramount importance. 

That's the background story, in a nutshell. Future WikiLeaks to follow.
For details regarding the precise nature of the substance that will soon be hitting the fan, watch this space"....

We hope Lilly stockholders get the bath they need.

Thanks and a tip of the Mad Hatter's Hat to 
The Bonkers Institute -