Pharma giant to pay record fine, penalty for illegal marketing
By JOYCE HOOI
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(SINGAPORE) US-based Pfizer Inc agreed yesterday to pay a record US$2.3 billion in fines and penalties as part of a criminal and civil lawsuit over the unlawful promotion of 13 drugs.
The pharmaceutical giant's subsidiary, Pharmacia & Upjohn, also agreed to plead guilty to a felony violation of the Food, Drug and Cosmetic Act in relation to the misbranding of an anti-inflammatory drug, Bextra, which was withdrawn from the market in 2005 over safety concerns.
Pharmacia had marketed Bextra for purposes and larger doses that had not been approved by the US Food and Drug Administration.
The same year Bextra was withdrawn in the US, the Health Sciences Authority in Singapore had withdrawn Bextra, after reports from Canada and the US linked the drug to an increased risk of heart attacks and skin reactions.
The settlement included a US$1.2 billion criminal fine related to the methods used to market Bextra. According to prosecutors, this is the largest criminal fine in the history of the United States.
Another US$1 billion of the charge took the form of civil payments related to the 'off-label' sales of four drugs - Bextra, Geodon, Zyvox and Lyrica, as well as payments to healthcare professionals.
These drugs had been marketed for purposes not authorised by the US Food and Drug Administration.
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In Singapore, Lyrica and Zyvox - an anti-epileptic drug and an antibiotic, respectively - are available as prescription drugs. However, prescription drugs are not allowed to be advertised to the public, according to local regulations.
As part of the settlement, Pharmacia also agreed to a criminal forfeiture of US$105 million.
In addition to the US$2.3 billion charge, Pfizer will pay up to US$33 million to settle state civil consumer fraud allegations related to the marketing of Geodon, an anti-psychotic drug.
The matter had been brought to light by six whistleblowers, including John Kopchinski, a former sales representative. The six of them will share US$102 million of the settlement sum.
'We regret certain actions taken in the past, but are proud of the action we've taken to strengthen our internal controls,' said Amy Schulman, Pfizer's general counsel, according to Reuters.
Pfizer, which is the world's largest drugmaker, was deemed a repeat offender by authorities, as this round of settlement of government's charges against it would be the company's fourth one in the last decade.
Its previous run-in with the authorities had been in 2004, when it had pleaded guilty to charges of illegally marketing Neurontin, an epilepsy drug, for migraine headaches and bipolar disorder.
As a result, Pfizer paid US$430 million to federal and state governments and had its marketing activities placed under federal supervision since.
The latest charge against the firm adds another five years to its participation in a compliance programme. It will be required to post information about payments to doctors on its website and also establish a system for doctors to report misconduct by Pfizer's representatives.
In January this year, Pfizer made headlines for its US$68 billion merger with Wyeth.
In Singapore, Pfizer Singapore was incorporated as a private company in 1964. Tuas is the site of Pfizer's first large-scale active pharmaceutical ingredient manufacturing facility in Asia.
Last year, Pfizer invested more than $60 million to expand the capabilities of its Clinical Research Unit at Raffles Hospital, more than tripling the unit's size.
It is among the several pharmaceutical companies that are expected to collectively add 500 jobs to Singapore this year and 2,000 jobs over the next three years as they continue to expand their facilities here.
According to Pfizer Inc's spokesperson, no additional charge to the firm's earnings will be recorded because of the settlement.
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