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Pfizer's Illegal Promotion of Bextra and Other Drugs Results in Record Settlement, Guilty Plea

Sep 3, 2009 | Parker Waichman LLP

Pfizer Inc. and its subsidiary, Pharmacia & Upjohn Company Inc., have agreed to pay a record-setting $2.3 billion to settle claims arising from the  illegal marketing  of some drugs.  According to a U.S. Department of Justice press release,  Pharmacia & Upjohn Company has also agreed to plead guilty to a felony violation regarding off-label promotions of the painkiller Bextra. Bextra was withdrawn from the market in 2005.

As we've reported previously, doctors may prescribe Food & Drug Administration-approved medicines any way they see fit.   But companies are legally barred from promoting unapproved, or so-called off-label, uses.

According to the Justice Department press release, Pharmacia & Upjohn Company will pay a criminal fine of $1.195 billion, the largest criminal fine ever imposed in the United States for any matter, for the Bextra promotions. Pharmacia & Upjohn will also forfeit $105 million, for a total criminal resolution of $1.3 billion.  According to Reuters, Bextra had only been approved to treat two types of arthritis pain and uterine pain, but the government claims it was marketed as a treatment for all types of pain.

In addition, Pfizer has agreed to pay $1 billion to resolve allegations it illegally promoted Bextra; Geodon, an anti-psychotic drug; Zyvox, an antibiotic; and Lyrica, an anti-epileptic drug, causing false claims to be submitted to government health care programs for uses that were not medically accepted indications and therefore not covered by those programs.  

The civil settlement also resolves allegations that Pfizer paid kickbacks to health care providers to induce them to prescribe these, as well as other, drugs. The federal share of the civil settlement is $668,514,830 and the state Medicaid share of the civil settlement is $331,485,170. This is the largest civil fraud settlement in history against a pharmaceutical company, the press release said.

Pfizer also has agreed to enter into an expansive corporate integrity agreement with the Office of Inspector General of the Department of Health and Human Services. That agreement provides for procedures and reviews to be put in place to avoid and promptly detect conduct similar to that which gave rise to this matter, the Justice Department said.

According to the Justice Department, the settlement is the result of the investigation instigated by six whistleblowers.  As a result of the settlement, the whistleblowers will receive $102 million of the federal fines.

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