Pharmaceutical giant GlaxoSmithKline posted declining third-quarter profits amid the European financial slowdown and tanking sales of its drug Avandia.
Avandia, also known as rosiglitazone, is a diabetes drug that works as an insulin sensitizer. Sales of Avandia peaked around 2006, when it brought in billions for GSK, but reports of serious adverse side effects caused sales to plummet in following years. The defective pharmaceutical was banned in Europe in 2010 and its use was severely restricted in the United States.
Reports obtained by the New York Times indicate that if every diabetic taking Avandia switched to a similar drug named Actos, almost 500 heart attacks and 300 heart failure cases could have been prevented every month. Unfortunately, patients who did switch to Actos may have suffered other life-threatening side effects. Actos and similar drugs have been linked to statistically significant increases in bladder cancer rates among patients.
GSK Covers Up Avandia Health Risks
A bipartisan multiyear investigation by the U.S. Senate found that GSK actively sought to hide the risks of Avandia from patients. The drugmaker allegedly knew of the potential for Avandia to do serious heart damage for years, but failed to warn doctors and patients.
"Instead, GSK executives attempted to intimidate independent physicians, focused on strategies to minimize or misrepresent findings that Avandia may increase cardiovascular risk, and sought ways to downplay findings that a competing drug might reduce cardiovascular risk," the Senate committee report concluded.
The release of Avandia to global markets has drawn attention to the lack of pharmaceutical safety oversight at the Food and Drug Administration. Critics say that the FDA is inadequately equipped to safeguard patients from dangerous, untested pharmaceuticals because safety officials are not as powerful as the individuals who deal with drugmakers and approve the release of drugs.
"It doesn't make any sense to have these experts who study drugs after they have been on the market for several years under the thumb of the officials who approved the drug in the first place and have a natural interest in defending that decision," said Sen. Charles E. Grassley, an Iowa Republican. "The Avandia case may be the most alarming example of the problem with this setup."
GSK recently agreed to pay more than $3 billion in criminal and civil liability claims by the U.S. government and several states for deceptive and illegal sales practices. The company hopes to put the fallout associated with Avandia behind it in the coming months and return to profitability with its new product offerings.
"With sales contributions from new products, together with further cost discipline, we remain confident that we can drive improvements in core operating margin over the next few years," said GSK Chief Executive Andrew Witty.
Source: Associated Press, "European austerity, falling sales drive GlaxoSmithKline Q3 profit down 18," Oct. 31, 2012; New York Times, "Research Ties Diabetes Drug to Heart Woes," Gardiner Harris, Feb. 19, 2012