It’s Time for Pharmaceutical Companies to Have Their Tobacco Moment

Twenty-five years ago, Congress hauled before it the top executives of the nation’s seven largest tobacco companies and forced them to make a number of long-overdue admissions about cigarettes — including that they might cause cancer and heart disease and that the executives had suppressed evidence of their addictive potential. In one dramatic exchange, when pressed by Representatives Henry Waxman and Ron Wyden, the executives denied that their products were addictive but admitted that they would not want their own children to use them.

The hearing ushered in a public health victory for the ages. In its wake, lawmakers and health officials enacted measures that would ultimately bring smoking rates in the United States to an all-time low.

With seven pharmaceutical executives set to testify before the Senate Finance Committee on Tuesday, one can only hope for a similarly pivotal moment for prescription drug prices. Like their predecessors in the tobacco industry, the drug makers will testify at a time of near-universal anger over industry antics. read more »

Drug Middlemen Took $123.5 Million in Hidden Fees, State Claims

In state plans for poor, markups for middlemen jumped in 2018

CVS manages drug benefits in several Kentucky Medicaid plans

Drug middlemen took $123.5 million in hidden fees from Kentucky health-insurance plans that cover the state’s poor, according to a report that follows efforts by other states to find out if pharmacy-benefit managers are gaming state programs for profits.

The Kentucky report is the latest to examine a controversial practice known as spread pricing, in which pharmacy-benefit managers pay drugstores one price for a treatment while charging a higher one to their health plan clients. read more »

Elon Musk Faces U.S. Contempt Claim for Violating SEC Accord

The U.S. Securities and Exchange Commission asked a judge to hold Elon Musk in contempt for violating his Oct. 16 settlement with the agency requiring him to seek pre-approval from Tesla Inc. for social media posts and other written communication that would be material to the company or investors, Bloomberg News reports. read more »

The Cost of Dirty Money

Since the financial crisis, dozens of crackdowns have targeted money launderers who effectively rely on banks, shell companies, and other mechanisms to cover their tracks. Fines have surged into the billions of dollars, but it’s unclear whether the enforcement efforts—some of the more notable ones are described here—have made much of a dent. According to the United Nations Office on Drugs and Crime, shady transactions continue to reach as much as $2 trillion a year. read more »

How a payday lending industry insider tilted academic research in its favor

Shortly after the Consumer Financial Protection Bureau began preparing what would become the first significant federal regulations for the multibillion-dollar payday-lending industry, Hilary Miller went to work.

Over the next year, Miller worked closely with Jennifer Lewis Priestley, a professor of statistics and data science at Kennesaw State University, suggesting research to cite, the type of data to use and even lecturing her on proofreading. “Punctuation and capitalization are somewhat random,” he said in a February 2014 email responding to a draft of the report. “You might want to have your maiden aunt who went to high school before 1960 read this.”

In a December 2013 exchange, Miller told Priestley that he wanted to persuade her to change the way she analyzed data about borrowers’ credit scores. “I am here to serve,” Priestley responded. “I just want to make sure that what I am doing analytically is reflecting your thinking.” Her email ended with a smiley face. read more »

German Dialysis Firm Reaches Agreement in Bribery Probe

German health-care firm Fresenius Medical Care AG said last week in a regulatory filing that it had reached an agreement in principle with U.S. authorities regarding a long-running foreign-bribery investigation that involved an anonymous whistleblower complaint.

Fresenius said in the filing that it received communications beginning in 2012 that had alleged conduct outside the U.S. that might violate the Foreign Corrupt Practices Act or other anti-bribery laws. The company didn’t identify who communicated the allegations to the company.

According to documents reviewed by The Wall Street Journal, an anonymous whistleblower sent an email in April 2012 to Fresenius managers and board members. The tipster, who alleged widespread bribery in parts of Latin America, said in the email that he or she would forward the message to U.S. authorities. read more »

Jeffrey Skilling, Former Enron Chief, Released After 12 Years in Prison

Jeffrey K. Skilling, the former chief executive of Enron whose lies contributed to the sudden collapse of the energy company in one of the country’s most high-profile cases of corporate fraud, was released from federal custody on Thursday after serving more than 12 years in prison, the federal authorities said.

Mr. Skilling was one of several Enron leaders who guided the company through a spectacular rise in the 1990s, as it evolved from a sleepy pipeline operator into one of the world’s dominant energy companies by reshaping the way natural gas and electricity were bought and sold. He was later convicted for his leading role in a complex fraud and conspiracy scheme that led to the company’s stunning fall, which culminated in one of the largest corporate bankruptcies in American history on Dec. 2, 2001.

The fall of Enron cost shareholders billions of dollars and its employees their retirement savings. Its demise ushered in a wave of prosecutions that rooted out accounting fraud at other companies like WorldCom, HealthSouth and Adelphia Communications. read more »