Outrage of the Month: The Continuing Problem of Pharmaceutical Industry Payments to Physicians
Health Letter, July 2025
By Robert Steinbrook, M.D.
Director, Public Citizen's Health Research Group
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you’re not paying attention!
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In April 2025 the U.S. Attorney for the Southern District of New York announced a $202-million settlement with Gilead Sciences for its use of speaker programs to pay kickbacks to doctors to persuade them to prescribe the company’s drugs for the treatment of HIV and AIDS.
Although the settlement covered promotional activities from January 2011 to November 2017, it reflects a troubling practice that has persisted for more than 30 years. In 2024 Public Citizen’s Health Research Group released a report documenting pharmaceutical-industry criminal and civil penalties from 1991 to 2021; we found 482 federal and state settlements with manufacturers, totaling $62.3 billion in financial penalties. Many of the settlements were related to opioid prescribing. The financial penalties amounted to a small percentage of the $1.9 trillion in net income made by the 35 largest drug companies in just 19 of these 31 years (2000-2018).
There are other recent examples. In 2022 Biogen Inc agreed to pay $900 million to settle allegations of improper physician payments. In 2024 Endo Health Solutions was ordered to pay about $1.5 billion in criminal fines and penalties for distributing misbranded opioid medication. In 2025 Pfizer agreed to pay nearly $60 million in response to false-claim allegations about improper physician payments by a subsidiary prior to its acquisition of the company.
The Gilead settlement is particularly disturbing because of the blatantly inappropriate conduct described. Gilead conducted HIV speaker programs to promote and increase the sales of its drugs, and the company’s compliance program failed to prevent the “improper practices,” even though officials knew that they “had to comply” with the federal antikickback statute. Although the programs were “supposed to be educational in nature” and the cost of any meals was “supposed to be modest,” in practice the programs were promotional, not educational, and the meals were not modest.
According to the Department of Justice press release, “Gilead’s HIV Speaker Programs provided kickbacks to healthcare providers by: holding HIV dinner programs at high-end restaurants that were wholly inappropriate for educational events; allowing Attendees to attend HIV Dinner Programs on the exact same topic again and again and, thereby, obtain free lavish meals for events that had minimal educational value for them; and paying for HIV Speakers to travel to speak at desirable destinations — at times at the HIV Speaker’s request.” Indeed, 250 people who prescribed the company’s HIV drugs attended a dinner program on the same topic three times or more within six months, and 80 attended five or more programs.
When doctors who “received these improper kickbacks” prescribed the company’s HIV drugs, “federal healthcare programs paid millions of dollars in reimbursements for tainted prescriptions.”
What is to be done? As there is little expectation that improper pharmaceutical payments to physicians will cease, the federal government and states must hold the pharmaceutical industry accountable for the unlawful promotion of drugs, overcharging government programs, and other illicit activities. As was the case with the Gilead lawsuit, government prosecutors can join lawsuits filed by a private party under the qui tam or whistleblower provisions of the federal False Claims Act. And prosecutors can be more willing to file criminal charges against pharmaceutical executives when the facts warrant.
This continuing problem has no easy solutions.