Ind. to receive Pfizer settlement dollars

Pfizer Inc. agreed to pay a $2.3 billion settlement, of which $3.7 million will go to Indiana for the illegal promotion of several of its drugs.

The agreement is the largest health care fraud settlement reached in the history of the Department of Justice, according to a press release.

Pharmacia & Upjohn Company, Pfizer’s subsidiary, pleaded guilty to misbranding
Bextra, an anti-inflammatory drug, and promoting it for non-FDA approved, off-label uses.

Bextra was pulled from the market in 2005. Pfizer also allegedly marketed three other drugs for purposes not approved by the FDA.

As a result of the alleged illegal practices, Indiana Medicaid paid for prescriptions that otherwise might not have been prescribed, said Bryan Corbin, a spokesman for the Indiana Attorney General’s Office.

The government’s suit was prompted after several sales representatives from Pfizer came forward with information about the company’s promotion practices. These employees, known as the “whistleblowers,” will receive a share of the settlement.

Corbin said the Attorney General’s Office is especially interested in whistleblower – or qui tam – lawsuits because they could be used in other situations in which state or federal governments end up paying falsely submitted claims.

“Pfizer has owned up to its improper conduct through which Medicaid was wrongly billed – conduct that whistleblower lawsuits helped bring to light,” Indiana Attorney General Greg Zoeller said in a press release. “To us, this case underscores the need for transparency at all levels – federal, state and local – whenever government agencies are asked to pay claims submitted by private entities.”

In total, Pfizer will pay $1 billion in civil payments and a $1.195 billion criminal penalty – the largest criminal fine ever imposed in the U.S., according to a press release from the Department of Justice. Pharmacia & Upjohn Company will supply $105 million as well, bringing the total to about $2.3 billion.

According to a Pfizer press release, the company denies all of the civil allegations, except it “acknowledges certain improper actions related to the promotion of Zyvox.”

“We regret certain actions taken in the past but are proud of the action we’ve taken to strengthen our internal controls and pioneer new procedures so that we not only comply with state and federal laws, but also meet the high standards that patients, physicians and the public expect from a leading worldwide company dedicated to healing and better health,” said Amy Schulman, senior vice president and general counsel of Pfizer, in a press release. “Corporate integrity is an absolute priority for Pfizer, and we will continue to take appropriate actions to further enhance our compliance practices and strengthen public trust in our company.”