(CN) – In the largest health-care fraud settlement in history, pharmaceutical giant Pfizer has agreed to pay $2.3 billion for illegally promoting Bextra and other drugs, the Department of Justice announced Wednesday.
Pfizer, along with its subsidiary Pharmacia & Upjohn Company Inc., pleaded guilty to charges of violating the Food, Drug and Cosmetic Act after they misbranded Bextra, an anti-inflammatory drug. The Act requires companies to specify the intended uses of drugs before marketing them.
Pfizer promoted Bextra for several different uses and dosages that were not FDA-approved for safety concerns. The drug was taken off the market in 2005.
In addition to the Bextra fraud, Pfizer pleaded guilty to illegally promoting three other medications- Geodon, an anti-psychotic drug; Lyrica, an anti-epileptic drug, and Zyvox, an antibiotic. The company allegedly paid health care providers kickbacks to promote these medications. Pfizer’s activities triggered the submission of false claims.
While doctors are allowed to prescribe drugs for “off-label” uses, pharmaceutical companies cannot legally promote them. Pfizer and Pharmacia & Upjohn will pay a $1.2 billion criminal fine and $1 billion in civil penalties.
Pfizer also agreed to enter an “expansive” corporate integrity agreement with the Office of Inspector General of the Department of Health and Human Services in an attempt to curb future fraudulent activities. Assistant Attorney General for the Civil Division Tony West called the settlement an “example of what penalties will be faced when a pharmaceutical company puts profits ahead of patient welfare.”
U.S. Attorney offices in Massachusetts, Virginia and Kentucky, as well as the Justice Department’s Civil Division handled the case, while a number of government agencies, spanning from the FBI to the U.S. Postal Service, coordinated the investigation against Pfizer. Six whistleblowers will receive a total of $102 million from the federal settlement for their cooperation in the case.
Some officials are optimistic that this case will return money into a troubled health care system.
“This historic settlement will return nearly $1 billion to Medicare, Medicaid, and other government insurance programs, securing their future for the Americans who depend on these programs,” said Secretary of Department of Health and Human Services Kathleen Sebelius. “Health care is too important to let a single dollar go to waste.”