What Do You Think About GlaxoSmithKline's $3 Billion Settlement?
Doesn't it just astound you how drug companies can continue to get busted on breaking the law and then pay mind-boggling, incredibly large fines and STILL have the capacity to break the law again?
Pretend you actually owned a drug company. Even if it wasn't your drug company that was previously caught manipulating doctors, selling off label, and generally breaking any rule or regulation you wish, simply to drive sales - wouldn't another drug company's punishment be enough to scare you away from doing those same actions? Obviously the answer is a resounding NO. I continue to ask myself, how can this be? This GSK $3 billion settlement proves to me that drug sales over time are so incredibly profitable that breaking the law and paying huge fines is of no consequence to the drug companies! As a shareholder in large companies it would bother me tremendously to learn that our company is either acting illegally or unethically within the medical community.
However, we see no shake-out in major shareholders from those drug companies. It will be interesting to see if any large shareholders pull out of GSK now that this settlement has been announced. Institutional shareholders make their decision as to whether to retain the stock of any investment solely based on the level of profit and return on investment over time. They will not consider the moral legal or ethical obligations they have to their shareholders to invest in only those stocks that play by the rules.
So here is the lesson that we, the public, must learn about corporate behavior: when thinking about corporate behavior, the only consideration is the bottom line! There is no room in a corporation's behavior or in an institutional investment strategy for legal, moral or ethical obligations to be upheld unless those decisions negatively impact the profit. Otherwise, if paying $3 billion makes you $27.5 billion then everyone is happy, right?
As the powerless muddled masses who look at the world around us, we need to support the only social system that protects us (normal, working class people) from them (powerful corporations who can pay $3 billion fines with a smile on their face). The only weapon the average US Citizen has against the large corporate entity is the power of the jury trial. That is it! No other system keeps law breaking corporate entities in check. Obviously billion dollar fines don't scare them. If we lose our right to go to court to redress our grievances we will lose our ability to protect ourselves and our loved ones from the profit-motivated amoral decisions of the large corporation.
Something to think about!
