Published September 4, 2009

Pfizer swallows a bitter US$2.3b pill

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of the Food, Drug and Cosmetic Act in relation to the misbranding of an anti-inflammatory drug, Bextra, which was withdrawn from the market in 2005 over safety concerns.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The same year Bextra was withdrawn in the US, the Health Sciences Authority in Singapore had withdrawn Bextra, after reports from Canada and the US linked the drug to an increased risk of heart attacks and skin reactions.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.

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.

Published September 3, 2009

Rains improving in key palm oil states

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(KUALA LUMPUR) Rains have weakened in key oil palm growing regions in Malaysia, due to El Nino, although recovery may be on the cards from September onwards, the head of the country's meteorology department said on Tuesday.

Triggered by an abnormal warming of the east Pacific Ocean, El Nino sapped rains in Sabah and Sarawak states, in East Malaysia, by 30-40 per cent as well as in Johor, in mainland Malaysia, by 50 per cent in August.

The three states jointly account for roughly 70 per cent of production in Malaysia, the world's No2 supplier of the vegetable oil.

Malaysia's Meteorology Service director-general Yap Kok Seng said there will be a recovery this month with mainland Malaysia getting normal rainfall while Sarawak gets 20 per cent lower rainfall and Sabah 10 per cent less.

'Beyond September till the end of the year, in the best scenario with a weak to moderate El Nino . . . Sarawak and Sabah are expected to receive up to 10 per cent below the monthly average rainfall,' he said in an interview.

Traders and plantation owners said better rains from September onwards could improve palm oil yields and bring forward the uptick in production to October from the end of the year.

'The impact of drier weather in August has done its damage to yields in Sabah but September will see a recovery. October will be the peak production month overall,' said Velayuthan Tan, chief executive of Sabah-based IJM Plantations .

The improvement in rains might be due to El Nino aiding the north-east monsoon winds that bring more rainfall across Asia, analysts and scientists have said. 'For the months of November to December, Malaysia is under the northeast monsoon where heavy rain usually occurs in the east coast of peninsular Malaysia, Sabah and Sarawak,' Mr Yap said. 'A 10-20 per cent below average rainfall (during this time) is considered a mild impact.' - Reuters

Published September 3, 2009

KL denies it is reviewing pay-TV operator's licence

Report had said plan was to make Astro carry more pro-govt content

By S JAYASANKARAN
IN KUALA LUMPUR

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KUALA Lumpur has denied a news portal's report that it was reviewing the licence for a Malaysian satellite pay-TV broadcaster in a move to make it carry more pro-government content.

Envy of rivals: Astro has exclusive licence to supply direct-to-home satellite TV and radio services

The Malaysian Insider news-portal had said yesterday that the Information Ministry was reviewing Astro All-Asia Networks' licence in a bid to promote more programming favourable to the government.

But the government denied it. 'There is no such thing,' Reuters quoted an official familiar with the ministry's plans.

The media is tightly controlled in Malaysia and newspapers require a permit which is annually renewed. But the Internet has made nonsense of the regulation and a host of blogs and newsportals critical of the government have sprung up in recent years.

Indeed, the Internet was one of the reasons why the ruling National Front government stumbled to its worst ever loss in last year's general elections. It has also lost six straight by-elections in Peninsular Malaysia since March last year and may have been the reason why the Information Ministry briefly contemplated filtering the Internet. The plan was abandoned after Prime Minister Najib Razak nixed it.

Astro is 44 per cent owned by tycoon T Ananda Krishnan and 22 per cent by state agency Khazanah Nasional and incurs the envy of its competitors because it possesses an exclusive licence - until 2017 - to supply direct-to-home satellite TV and radio services. It was listed on the Kuala Lumpur stock exchange in 2003

Other competitors vying to supply pay-TV services through other means - cable or via the Internet - have failed largely because Astro locks in exclusive supply contracts with its content providers like Discovery, HBO and the BBC. Indeed, Astro's near-monopoly of the sports channels - because of its capacity to pay - has made it the target of attacks from envious competitors.

Not everyone in government is enamoured with the pay-TV operator though. The content on some of Astro news channels like Al Jazeera or BBC - interviews with opposition leader Anwar Ibrahim or coverage of demonstrations in Kuala Lumpur, for example - must grate on Kuala Lumpur's sensibilities.

But a senior Astro official told BT that there were 'no real issues.' He said that the company had been in talks with the government for 'almost a year' for migration to a new licence under the new multimedia act but stressed that the company 'would be no worse off' under the new licence.

'We are currently negotiating on the terms. They just want to make sure that we are on the same licence as all other TV stations,' Tammy Toh, Astro's head of communications told Reuters.

A second government official told Reuters that the talks related to Astro's regulatory environment, for example its ability to raise prices without reference to the government as it did recently when it raised the cost of its sports package.

That, however, seems unlikely. Astro's original licence allows the operator to increase prices of content - sports packages have risen astronomically in recent years - and the 'no worse off' clause insisted upon by Astro would make it hard for the government to regulate pricing.