Summary
Pfizer Inc. (PFE) has filed an 8-K report on September 2, 2009, detailing the finalization of a previously announced agreement in principle with the U.S. Department of Justice (DOJ) to settle investigations into past off-label promotional practices. This settlement covers Bextra, Zyvox, Geodon, and Lyrica, as well as allegations related to payments to healthcare professionals for several other medicines. The company had previously disclosed a $2.3 billion charge in Q4 2008 for this DOJ agreement, and no additional charge will be recognized. In addition to the federal settlement, Pfizer has also reached agreements with attorneys general from 42 states and the District of Columbia to resolve state civil consumer protection allegations concerning Geodon's past promotion. This will result in a $33 million payment to the settling states, with a charge to be recorded in the third quarter of 2009. A subsidiary will plead guilty to a criminal count related to Bextra promotion.
Key Highlights
- 1Pfizer finalized its settlement with the U.S. Department of Justice regarding past off-label promotional practices for Bextra, Zyvox, Geodon, and Lyrica.
- 2A subsidiary, Pharmacia & Upjohn Company, Inc., will plead guilty to one criminal count related to the past promotion of Bextra.
- 3The total settlement with the DOJ includes $2.3 billion previously disclosed, consisting of $1.0 billion in civil payments and a $1.3 billion criminal penalty for Bextra.
- 4No additional financial charge will be recorded for the DOJ settlement, as the related $2.3 billion was already accounted for in Q4 2008 earnings.
- 5Pfizer also settled with attorneys general in 42 states and the District of Columbia for $33 million concerning past promotional practices for Geodon.
- 6A $33 million charge will be recorded in the third quarter of 2009 for the settlement with the states.
- 7The settlements resolve investigations into alleged past off-label promotional activities and certain payments to healthcare professionals.