Certainly ... and the condemning / damaging thing is the scale of the imperfection. But it's also worth pointing out that many of Google's AdWords policies have long been written to be at the edge of a nexus of the law and public pressure of a market. Pornography, for example. Or "drugs and drug paraphernalia", where bongs and water pipes are prohibited, but vaporisers are allowed if they are advertised as "an aromatherapy device".[1] Which is to say: the pharmacy policy, like others, was likely constructed by Google to get away with as much as possible without damaging the brand or the bottom line. And it hasn't worked.
Except Google employees do manually review ads. Ads that might break the guidelines, such as pharmacy ads, are flagged by the system when they are submitted. Flagged ads are then reviewed manually to see if they comply with policy.
[1] http://adwords.google.com/support/aw/bin/static.py?hl=en-GB&...