Drug kingpin pays $2.3 billion fine, but only 12% in taxes

Although illegal drug dealers don't pay taxes, when they're caught breaking the law, they go to prison. Legal drug dealers don't.

When they are nabbed by the authorities they can buy their way out with big settlements. A cash-strapped government, who's under-staffed by under-paid law enforcement personal, investigators, and regulators, usually have no choice, because CEOs aren't under-paid and can afford the best attorneys..

It appears that with all the tax loopholes that large corporations enjoy, we have to investigate and prosecute them to get any tax revenues from them (with the exception of the big banks, we know who rules this country. They get immunity!)

This may be news to you, but I just found this out today...

I was watching American Greed on CNBC tonight and learned that in 2009 the pharmaceutical giant Pfizer agreed to pay a record-breaking fine of $2.3 billion to settle civil and criminal allegations that it had illegally marketed its painkiller Bextra, which has since been withdrawn from the market.

The New York Times says, "It was the largest health care fraud settlement and the largest criminal fine of any kind ever."

In pursuing a case against Pfizer for fraudulently promoting drugs that eventually led to the largest health fraud settlement in U.S. history, the feds leaned heavily on evidence supplied by a half-dozen whistle-blowers.

Besides heart attacks and other dangerous side-effects, Bextra had even been known to cause Stevens-Johnson syndrome, which begins with flu-like symptoms, followed by a painful red or purplish rash that spreads and blisters, eventually causing the top layer of your skin to die and shed...

...and Pfizer's CEO and board of directors knew this, but had their salespeople push it for profits anyway. The fine was paid with a single wire transfer (easy money!)

Is this what the Republicans mean by "over regulated"? That corporations should be able to do whatever they want in the name of profits? Is this what the Republicans mean by "tort reform", so that the victims can't sue the corporate executive's "money machine" after they neglected the health and welfare of the people, just to line their own pockets with bonuses and stock options...and only paying 15% in capital gains taxes, rather than the top income rate of 35%?

Is this what the Republicans mean when they say that businesses need "certainty in the market", so that corporations can be certain they won't have to pay their share of taxes and not be arrested when they violate the law?

If corporations are really "people", shouldn't they also go to jail when they break the law? Especially when people are physically harmed? There's people sitting in prison for possession of one joint (3 strikes and you're out!)

Prior convictions and settlements of Pfizer entities:

Last month Pfizer agreed to pay $14.5 million to resolve False Claims Act allegations related to its illegal marketing of the drug Detrol
Earlier this year in January Pfizer was ordered to pay a total of $142.1 million in damages for violating federal racketeering laws in the marketing of its epilepsy drug Neurontin.
In 2007, Pfizer subsidiary Pharmacia & Upjohn, Inc. paid $34 million and pled guilty to paying kickbacks for formulary placement of its drugs and entered into a Deferred Prosecution Agreement for off-label distribution of the drug Genotropin
In 2004, Pfizer subsidiary Warner-Lambert pled guilty and paid more than $430 million to resolve criminal charges and civil liability in connection with its fraudulent marketing practices with respect to the drug Neurontin
In 2002, Pfizer, and its subsidiaries Warner Lambert and Parke-Davis, paid $49 million to resolve civil claims that it had failed to report best prices for its drug Lipitor as is required under the Medicaid Drug Rebate Statute

And that's just what I found with a quick Google search for criminal charges,. I didn't look for other lawsuits.

And no one went to prison....just like with the bankers. They call this "white collar crime", and it runs rampant in this country...and the biggest offenders are rarely punished. Bernie Madoff was one of the few exceptions. If the government cracked down more, maybe we'd have better corporate governance. But that's impossible, we just don't have enough people to carry out this task, just like our "war on drugs".

Now today I read that Pfizer will also have to pay more than $60 million to resolve U.S. government probes into whether the drug maker paid bribes to win business overseas. Are all these people above the law? Are all these CEOs and corporate executives Too Big to Jail?

What ever happened to "3 strikes and you're out"? If the government is going to lock up drug kingpins, then lock up drug executives too if they break the law. After all, they're "people", remember? (cont.)

And on top of their criminal activities, they're also tax cheats (albeit, lawful ones). Pfizer's effective corporate tax rate was only 11.9% in 2010 ( 20.3% in 2009, 17.0% in 2008, 11.0% in 2007, and 15.3% in 2006). The corporate tax rate in the U.S. is supposed to be 35%, but whoever actually pays that? Exxon-Mobil, GE, Boeing, and Bank of America certainly didn't. (Can I stop counting now?)

Pfizer started out marketing citric acid in the 1880's, penicillin in the 1940s, and by the 1950s was established in Belgium, Brazil, Canada, Cuba, Iran, Mexico, Panama, Puerto Rico, Turkey and the United Kingdom. So how did it grow and flourish all those years, especially during the 1950s when the corporate tax rate was once 92%?

So why are all the CEOs and Republicans now crying about high taxes, when the rate is only 35% in 2011, but most only pay between 14% and 18% on average? And why does the Tea Party keep spreading the lie of "high taxes" in their newsletters to me?

READ: Inside Pfizer's Palace Coup - Henry "Hank" McKinnell Jr. had taken over as CEO of Pfizer in 2001. In 2002 he announced the acquisition of Pharmacia, the industry's seventh-largest company, for $60 billion in stock. In January 2009, Kindler announced a $68 billion deal to buy Wyeth.

And then later, in September of 2009, was the mother of all settlements - Pfizer's $2.3 billion fine for civil and criminal "allegations" for fraud.

On Dec. 5, 2010, the CEO Henry Kindler and Pfizer agreed on a generous exit package (of course). He was getting $16 million in cash and stock, another $6.9 million in retirement benefits, and various other forms of stock compensation. What portion of this agreement was settled in stocks, whereas he'd only have pay a 15% capitol gains tax? (less than Warren Buffet's secretary).

It's ironic in that what Pfizer manufactures (drugs) is meant to help people, but at the same time, they hurt so many others, in many different ways. But I suppose that it's really only the researchers, those who discover these scientific break-throughs, who are the only ones who feel real empathy for the population-at-large.

Pfizer, as the corporation that manufacturers, markets, and distributes these miracles of modern medicine, takes on a more macabre quality. This is what happens when a company gets "too big to fail". They stop thinking of their customers as real "people", and they start becoming just "revenue streams".

Meanwhile, Pfizer's on track to layoff another 31,000 more employees, after having already having laid off 33,400 workers as of Oct. 3, 2011 due to an upcoming expiration of drug patents.

The big drug companies are facing increasing problems caused by a slowdown in the development of new “blockbuster” drugs. The pressure for profits is relentless and, it seems, that some in the industry are willing to cut corners and more, just to keep the stock price up. (Nothing personal, it's just business.) Click photo below to enlarge the photo to see their largest shareholders.