US Court imposes record fine and forfeiture of $1.3 billion for Pfizer unit's fraudulent marketing of Bextra

Pharmacia & Upjohn, a subsidiary acquired in 2003 by USA-based drug behemoth Pfizer ' which has just completed its $68 billion acquisition of Wyeth, has been sentenced in federal court for a felony violation of the Food, Drug & Cosmetic Act, for misbranding the COX-2 selective inhibitor drug Bextra (valdecoxib), with the intent to defraud or mislead. The company was sentenced by US District Judge Douglas Woodlock to pay a criminal fine of $1.195 billion and a criminal forfeiture of $105 million, for a total criminal resolution of $1.3 billion, the largest health care fraud settlement in the history of the US Department of Justice.

In addition, as announced on September 2, 2009 (The Pharma Letter September 3), Pfizer agreed to pay an additional $1 billion plus interest to settle civil allegations that it fraudulently promoted and marketed Bextra, as well as three other drugs in its portfolio, Geodon (ziprasidone), an anti-psychotic drug, Zyvox (linezolid), an antibiotic, and Lyrica (pregabalin), an anti-epileptic drug, as well as claims that it paid kickbacks for these, as well as other drugs, to induce physician prescribing.

Pfizer also agreed to comply with the terms of a new and significantly expanded corporate compliance program, which seeks to ensure that in the future there are procedures and reviews in place to avoid, or, at a minimum, timely detect such violations.

Background

At an earlier plea hearing, the prosecutor informed the court that had this case had gone to trial, the government's evidence would have proven that:

When Bextra received its approval from the US Food and Drug Administration in November 2001, the agency notified Pharmacia. that Bextra was approved for three indications: osteoarthritis, adult rheumatoid arthritis and for the treatment of primary dysmennorrhea. The company had originally sought approval of Bextra for higher dosages for general acute pain, including surgical pain. However, the FDA declined to approve Bextra for these uses and for any dosage for arthritis above 10mg., in part, because of safety concerns about the drug. In particular, the FDA cited as a safety concern the results of a study of Bextra and its injectable form, parecoxib, used in patients undergoing coronary artery bypass graft surgery (the "CABG I" trial); the FDA specifically noted that there was an excess of serious cardiovascular events in the Bextra/parecoxib arm of the trial.

Under the provisions of the Food, Drug and Cosmetic Act, a company must specify the intended uses of a product in its new drug application to FDA. Once approved, the drug may not be marketed or promoted for so-called "off-label" uses - any use not specified in an application and approved by FDA.

Nonetheless, from in or about February 2002 through Bextra's removal from the market in April 2005, Pharmacia, first through a co-promotion agreement with Pfizer, and then as a subsidiary of and with Pfizer, promoted the sale of Bextra for some of the very uses and dosages that the FDA had declined to approve - such as for general acute pain and surgical pain - and about which the FDA had raised specific safety concerns. It also promoted Bextra with false and misleading claims of safety and efficacy. Moreover, when so promoting Bextra, Pharmacia did not inform physicians, customers and others that it had asked the FDA to approve Bextra for these uses, but that the agency had specifically refused to do so in part because of safety issues, including potential cardiovascular risks