Bottle of Lies: The Inside Story of the Generic Drug Boom

In the early 1900s, Dr. Yusuf Hamied had Cipla manufacture and offer AIDS medicine at an affordable price, to try to help with the ongoing AIDS epidemic, but the company had zero sales of the drug. Hamied asked the Indian government to distribute it, but they refused. Cipla discarded all the medicine—about 200,000 capsules.

Hamied then strove to manufacture a cocktail of three effective AIDS drugs, producing them as one capsule. Meanwhile, South Africa, under the leadership of Nelson Mandela, altered its laws to sidestep trade agreements, so that the country could import lower-cost medicine, but this was met with a huge backlash from the larger, global pharmaceutical companies, colloquially known as “Big Pharma.”

Hamied spoke at a disease conference and tried to offer Cipla’s AIDS medicine at an incredibly affordable price, but he received no interest. Eventually, a story was picked up in the news: Hamied was offering the AIDS cocktail at a price of $1 a day. Public fury turned against Big Pharma. In 2003, President Bush announced that the US government would spend $15 billion on combating AIDS and established the President’s Emergency Plan for AIDS Relief (PEPFAR) program, which aimed to provide access to affordable antiretroviral drugs in developing countries. The drugs had to meet the FDA’s standards.

In 2005, Ranbaxy was the Indian first generics company to get approved to sell its AIDS drug via PEPFAR.

Malik left Ranbaxy and later became chief operating officer of Matrix Laboratories, another Indian company. The American name-brand drug company Mylan acquired Matrix Laboratories in 2005. Eban describes Mylan as a company keenly focused on quality and process. By contrast, Malik was trained at Ranbaxy, where profits were prioritized over all else.

Eban describes how difficult it is for generic drug companies to manufacture a drug: They must reverse-engineer the original name-brand drug and then develop a manufacturing process that replicates the efficacy and safety of the name-brand drug, all while ensuring the process is different—and ideally faster—than the one used by the brand-name company.

As the head of Matrix, Malik seemed to master the “tensions between cost, quality, and speed, using cleverness,” a kind of cleverness that was distinct from “Jugaad—taking ethically dubious shortcuts to get as quickly as possible to the desired goal. The word connoted a compromise on quality” (100).

Thakur and his team dove into the assignment that Kumar had tasked them with. They were meant to investigate Ranbaxy’s data practices and determine which data was false and which was true.

The team discovered that Ranbaxy was committing fraud on a wide scale. The company used falsified data in manufacturing and testing all of its drugs, and the severity of the fraud depended the drug’s target market. Employees falsified all, or nearly all, of the data for drugs that were intended for lower-income countries.

Kumar presented these findings to the executives of the company in what would later become an infamous document, called the Self-Assessment Report (SAR). Tempest, the CEO, asked for the data to be destroyed; he wanted all copies deleted and the computer it was created on dismantled. Kumar resigned from the company.

After Kumar left, Thakur was hassled by the “secret police of the company,” the company’s internal auditors. They falsely accused Thakur of browsing porn on his computer (116). Thakur then resigned.