Pfizer to pay record $2.3 billion penalty for drug promos
September 3, 2009
Federal prosecutors hit Pfizer Inc. with a record-breaking $2.3 billion in fines and called the world''s largest drugmaker a repeating corporate cheat for illegal drug promotions that plied doctors with free golf, massages, and resort junkets, reports the Associated Press. Announcing the penalty as a warning to all drug manufacturers, Justice Department officials said the overall settlement is the largest ever paid by a drug company for alleged violations of federal drug rules, and the $1.2 billion criminal fine is the largest ever in any U.S. criminal case. The total includes $1 billion in civil penalties and a $100 million criminal forfeiture. Authorities called Pfizer a repeat offender, noting it is the company''s fourth such settlement of government charges in the last decade. The allegations surround the marketing of 13 different drugs, including big sellers such as Viagra, Zoloft, and Lipitor. As part of its illegal marketing, Pfizer invited doctors to consultant meetings at resort locations, paying their expenses and providing perks, prosecutors said. The Health and Human Service Department inspector general will specially monitor Pfizer’s conduct for five years. The $1 billion in civil penalties was related to Bextra and a number of other medicines. A portion of the civil penalty will be distributed to 49 states and the District of Columbia, according to agreements with each state''s Medicaid program. The civil settlement announced covered Pfizer''s promotions of Bextra, blockbuster nerve pain and epilepsy treatment Lyrica, schizophrenia medicine Geodon, antibiotic Zyvox and nine other medicines. The agreement with the Justice Department resolves the investigation into promotion of all those drugs, Pfizer said. The government said Pfizer also paid kickbacks to market a host of big-name drugs: Aricept, Celebrex, Lipitor, Norvasc, Relpax, Viagra, Zithromax, Zoloft, and Zyrtec. The allegations came to light thanks largely to five Pfizer employees and one Pennsylvania doctor, who will now share $102 million of the settlement money. To rein in the abuses, the government''s five-year monitoring will force Pfizer to notify doctors about the agreement, encourage them to report any similar behavior, and publicly post any payments or perks it gives to doctors. Under terms of the settlement, Pfizer must pay $1 billion to compensate Medicaid, Medicare, and other federal health care programs. Some of that money will be shared among the states.