News Americas, PROVIDENCE, R.I., Fri. Aug. 26, 2011: Google, Inc. this week agreed to forfeit $500 million.
The online search engine agreed Wednesday to the forfeit for allowing online Canadian pharmacies to advertise through its AdWords program targeting consumers in the United States with the unlawful importation of controlled and non-controlled prescription drugs.
The forfeiture, one of the largest ever in the United States, represents the gross revenue received by Google as a result of Canadian pharmacies advertising through Google’s AdWords program, plus gross revenue made by Canadian pharmacies from their sales to U.S. consumers.
According to investigators, Google was aware as early as 2003, that generally, it was illegal for pharmacies to ship controlled and non-controlled prescription drugs into the United States from Canada.
The importation of prescription drugs to consumers in the United States is almost always unlawful because the FDA cannot ensure the safety and effectiveness of foreign prescription drugs that are not FDA-approved. The drugs may not meet FDA’s labeling requirements; may not have been manufactured, stored, and distributed under proper conditions; and may not have been dispensed pursuant to a valid prescription. While Canada has its own regulatory rules for prescription drugs, Canadian pharmacies that ship prescription drugs to U.S. residents are not subject to Canadian regulatory authority, and many sell drugs obtained from countries other than Canada which lack adequate pharmacy regulations.
According to prosecutors, as early as 2003, Google was on notice that online Canadian pharmacies were advertising prescription drugs to Google users in the United States using Google’s AdWords advertising program. Although Google took steps to block pharmacies in countries other than Canada from advertising in the United States, they continued to allow Canadian pharmacy advertisers to target U.S. consumers. Google was aware that U.S. consumers were making online purchases of prescription drugs from these Canadian online pharmacies, and that many of the pharmacies distributed prescription drugs, including controlled prescription drugs, based on an online consultation rather than a valid prescription from a treating medical practitioner. Google was also on notice that many pharmacies accepting an online consultation rather than a prescription charged a premium because individuals in search of prescription drugs without a valid prescription were willing to pay higher prices for the drugs.
The investigation also revealed that from 2003 through 2009, Google provided customer support to some of these Canadian online pharmacy advertisers to assist them in placing and optimizing their AdWords advertisements and in improving the effectiveness of their websites.
In 2009, after Google became aware of the investigation of its online pharmacy advertising practices, and as a result of that investigation, Google took a number of steps to prevent the unlawful sale of prescription drugs by online pharmacies to U.S. consumers. Among other things, Google began requiring online pharmacy advertisers to be certified by the National Association of Boards of Pharmacy’s Verified Internet Pharmacy Practices Sites Program. The program conducts site visits, has a stringent standard against the issuance of prescriptions based on online consultations, and, most significantly, does not certify Canadian online pharmacies. In addition, Google retained an independent company to enhance detection of pharmacy advertisers exploiting flaws in the Google’s screening systems.
Under an agreement signed with the government, Google acknowledges that it improperly assisted Canadian online pharmacy advertisers to run advertisements that targeted the United States and that the company accepts responsibility for its conduct. In addition to requiring Google to forfeit $500 million, the agreement also provides a number of compliance and reporting measures which must be taken in order to ensure that the conduct described in the agreement does not occur in the future.
The shipment of prescription drugs from foreign pharmacies to customers in the United States typically violates the Federal Food, Drug and Cosmetic Act, and, in the case of controlled prescription drugs, the Controlled Substances Act.
