Sunday, April 04, 2010
The bad news seems without end for pharmaceutical manufacturer Pfizer, which has only itself to blame. In addition to paying the largest criminal fine in U.S. history ($1.19 billion) for illegally marketing the painkiller Bextra, Pfizer created a shell company to plead guilty to charges of paying doctors to prescribe the drug to patients. Federal prosecutors knew about the shell-company scheme and went along because the federal government decided Pfizer, like large Wall Street institutions, was too big to fail.
Had the government leveled its punishment directly on the parent company, Pfizer would have been prevented from participating in the Medicare and Medicaid programs. Such a punishment would have amounted to “a corporate death sentence,” according to a CNN investigation, and Washington didn’t have the stomach to see the pharmaceutical giant collapse and its thousands of employees hit the streets.
So the feds allowed a Pfizer subsidiary, Pharmacia & Upjohn Co. Inc., to take the fall. The result: Pharmacia & Upjohn Co. Inc. was excluded from Medicare “without ever having sold so much as a single pill,” while the parent corporation continued to do business with federally-funded health programs.
Federal Jury Sides with Pfizer Whistleblower
On the same day CNN broke the story about the shell company, Pfizer was also in the news for losing a whistleblower lawsuit that will cost the company $1.37 million. A jury awarded the damages to Becky McClain, a former Pfizer scientist who became ill after being exposed to a genetically engineered virus at a company laboratory—and was then fired for raising safety concerns.
The jury decided Pfizer had violated laws protecting free speech and whistleblowers by retaliating against McClain, who continues to suffer from a potassium deficiency that causes sporadic and temporary paralysis.
Pfizer Admits Paying $20 Million to 4,500 Doctors in Six Months
The third disclosure of the week for Pfizer involved admitting it had paid $20 million to 4,500 doctors and other medical professionals for consulting and speaking on its behalf in the last six months of 2009. The company also told of another $15.3 million it doled out to 250 academic medical centers and other research groups for clinical trials in the same period. The latter represented the first admission of its kind by a pharmaceutical company in the U.S.
Most of the disclosures were required of Pfizer as part the settlement it reached with the federal government last summer for illegally promoting its drugs for uses not approved by the Food and Drug Administration.
-David Wallechinsky
Feds Found Pfizer Too Big to Nail (by Drew Griffin and Andy Segal, CNN)
Drug Companies Find it Cost-Effective to Pay Fines and Keep Breaking Laws (by David Wallechinsky, AllGov)
Pfizer to Pay Largest Criminal Fine in History (by David Wallechinsky, AllGov)
A Pfizer Whistle-Blower Is Awarded $1.4 Million (by Andrew Pollack and Duff Wilson, New York Times)
Becky McClain v. Pfizer (U.S. District Court, Connecticut) (pdf)
Pfizer Gives Details on Payments to Doctors (by Duff Wilson, New York Times)
Comments