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Google in $500m drug advertising settlement

Google will pay a settlement charge of $500m following a US government investigation into its advertising practices that allowed Canadian pharmacies to illegally market drugs to American consumers

Google will pay a settlement charge of $500m following a US government investigation into its advertising practices that allowed Canadian pharmacies to illegally market prescription and non-prescription drugs to American consumers.

The search engine giant will now avoid a criminal prosecution case in the US claiming the company had profited from advertisements on its services that promoted Canadian pharmacies that illegally imported drugs into the US.

The importation of prescription drugs to consumers in the US is almost always unlawful because the US Food and Drug Administration (FDA) cannot ensure the safety and effectiveness of foreign prescription drugs, according to the US Department of Justice.

The settlement figure represents gross sales made by Google in related advertising sales, as well as earnings generated from illegal drug sales to US consumers over the period 2003 to 2009, according to federal investigators.

In a statement, Google said: "We banned the advertising of prescription drugs in the US by Canadian pharmacies some time ago. However, it's obvious with hindsight that we shouldn't have allowed these ads on Google in the first place."

Officials in the US claimed Google knew its advertising service was allowing such illegal activities as early as 2003.

The US Justice Department also commented on a need for greater pharmaceutical regulation in Canada: "While Canada has its own regulatory rules for prescription drugs, Canadian pharmacies that ship prescription drugs to US residents are not subject to Canadian regulatory authority, and many sell drugs obtained from countries other than Canada which lack adequate pharmacy regulations."

25th August 2011

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