FDA monopoly enforcement goes after Google for $500 million in online pharmacy ad profits

Friday, February 10, 2012 by: Ethan A. Huff, staff writer
Tags: FDA, Google, online pharmacies

(NaturalNews) The U.S. Food and Drug Administration (FDA) recently snagged a hefty $500 million forfeiture, one of the largest in history, from search engine giant Google for running advertisements on its AdWords service for Canadian pharmacies. The agency claims these ads, which were also viewable by Americans, facilitated the illegal shipment of prescription drugs into the U.S. in violation of the Federal Food, Drug and Cosmetic Act, as well as the Controlled Substances Act.

A trophy in the FDA's trophy case of strong-armed regulatory enforcement actions, the $500 million forfeiture demonstrates the agency's intolerance for the sale of any drug that is not officially FDA-approved. But what it also embodies is a whole new level of government reach into private business practices, which in this case did not necessarily constitute a violation of the law on Google's part.

Since Google did not directly introduce or deliver Canadian drugs to U.S. customers, the company is technically not in violation of U.S. law. But according to the Justice Department, Google acted as an accomplice to the crime by "enhancing the ability of Canadian pharmacies to reach American consumers," according to The New York Times (http://dealbook.nytimes.com).

But does allowing various advertising as part of its service constitute engaging in criminal behavior? This is a blurry zone in federal law that was recently addressed in the debates about SOPA and PIPA as well, concerning whether or not allowing links to diverse content that could be in violation of the law, rather than directly censoring them, is illegal.

In this case, Google chose to enter a non-prosecution agreement with the government, which is basically a formal way of saying that Google essentially paid off the federal government not to prosecute the company. Such an agreement can go both ways -- on the one hand, the federal government gains protection against a countersuit for its potential overreach into Google's activities, while at the same time Google gains protection from creating for itself a criminal record.

Meanwhile, the only things that were technically accomplished in the case is that Google had to sacrifice a small percentage of its profits, and the FDA became $500 million richer. The public, on the other hand, gained nothing.

Since there was no actual legal case or ruling, Google is now technically free to continue allowing Canadian pharmacy advertising as it was never determined whether or not this practice is considered legal. So when you really think about it, the FDA just wanted a piece of the pie that is Google's profits, and really could not care less about consumer safety.

Sources for this article include:

http://www.fda.gov/ICECI/CriminalInvestigations/ucm276002.htm

http://dealbook.nytimes.com

http://www.dailytech.com