Pfizer To Pay $2.3 Billion To Settle Case On Drug Marketing - DOJ
September 02 2009 - 11:13AM
Dow Jones News
Pfizer Inc. (PFE) has agreed to pay $2.3 billion to settle
charges that it illegally marketed the pain drug Bextra and three
other medicines for uses that weren't approved by the Food and Drug
Administration, the U.S. Justice Department announced
Wednesday.
The Justice Department said the agreement was the largest
health-care fraud settlement in the department's history.
The department said that, as part of the settlement, Pfizer
subsidiary Pharmacia & Upjohn Co. agreed to plead guilty to a
felony violation for misbranding Bextra.
The department said Pfizer promoted Bextra for several uses and
dosages that the FDA specifically declined to approve because of
safety concerns.
Pfizer also improperly promoted the anti-psychotic drug Geodon,
the antibiotic drug Zyvox and the anti-epileptic drug Lyrica, the
department said.
The department said Pfizer will pay $1.3 billion in criminal
fines and another $1 billion in civil fines.
Pfizer alerted investors in January that a settlement was near,
saying in an earnings release that it took a $2.3 billion charge in
the fourth quarter of 2008 to cover the cost of the settlement.
That announcement came the same day the New York drug maker said it
was acquiring New Jersey-based Wyeth in a $68 billion deal.
Pfizer pulled Bextra from the market in 2005 because the FDA
concluded its risks, including a rare but serious skin reaction,
outweighed its benefit.
Bextra's troubles began in 2004 when Vioxx, Merck & Co.'s
(MRK) popular non-steroidal painkiller somewhat similar to Bextra,
was withdrawn from the market after being linked to heart attacks.
That November, during a Senate hearing on Vioxx, a whistleblower
from the FDA testified that he believed five other prominent drugs
should also be withdrawn because of safety issues, and named Bextra
as one.
His words sent analysts and brokers who had jammed into the
hearing room running to their phones.
Pfizer's other non-steroidal painkiller, Celebrex, hasn't been
withdrawn, but last October the company agreed to pay $894 million
to settle a series of state, personal-injury and class-action
lawsuits involving both drugs.
The company said Wednesday it will pay $33 million to 42 states
and the District of Columbia to settle state civil consumer
protection allegations related to its past promotional practices
concerning Geodon. A charge in that amount will be recorded this
quarter.
-By Brent Kendall, Dow Jones Newswires; 202-862-9222;
brent.kendall@dowjones.com
(Alicia Mundy and Peter Loftus contributed to this report.)