Pfizer pays $60m in bribery cases
pharmafile | August 8, 2012 | News story | Sales and Marketing | DoJ, FDA, GSK, Janssen, Pfizer, Wyeth, bribery
Pfizer has been fined $60 million for making improper payments to doctors in Europe, Asia and the Middle East.
The charge has been made by the US Department of Justice (DoJ) and the firm will pay a criminal fine of $15 million to the US government.
Under the terms of a civil settlement with the Securities and Exchange Commission, Pfizer will also cough up $16 million from its profits, as well as a pre-judgment interest charge of $10.3 million.
In a separate civil settlement, Pfizer also announced that its Wyeth subsidiary has agreed to pay $18.9 million to resolve issues involving certain “improper payments in the operations of four subsidiaries outside the US”, bringing the total level of the fines up to $60.2 million.
The DoJ had been looking to charge a Pfizer subsidiary with “conspiracy and violations in connection with improper payments” made to government officials, including publicly-employed regulators and healthcare professionals in Bulgaria, Croatia, Kazakhstan and Russia.
Pfizer avoided receiving a harsher criminal charge by entering into a ‘deferred prosecution agreement’ with the US government and paying the fines.
Assistant director McJunkin of the DoJ said: “Corrupt pay-offs to foreign officials in order to secure lucrative contracts creates an inherently uneven marketplace and puts honest companies at a disadvantage.
“Those that attempt to make these illegal backroom deals to influence contract procurement can expect to be investigated by the FBI and appropriately held responsible for their actions.”
Bribes
According to court documents, Pfizer made a broad range of improper payments to numerous government officials in Bulgaria, Croatia, Kazakhstan and Russia. These payments also extended to hospital administrators, members of regulatory and purchasing committees and other healthcare professionals.
The DoJ said that Pfizer “sought to improperly influence government decisions” in these countries regarding the approval and registration of Pfizer’s products, the award of pharmaceutical tenders and the level of sales of its products.
This is illegal under the 1977 Foreign Corrupt Practices Act, and is the legislation the DoJ used to charge Pfizer.
The court documents also shows that Pfizer “used numerous mechanisms to improperly influence government officials”, including sham consulting contracts, an exclusive distributorship and improper travel and cash payments.
In the settlement, Pfizer admitted that between 1997 and 2006, it paid more than $2 million of bribes to government officials in Bulgaria, Croatia, Kazakhstan and Russia. It also admitted that it made more than $7 million in profits as a result of the bribes.
This is another black eye for the industry’s reputation after GSK was charged a massive $3 billion for off-label marketing and bribery charges last month.
Other firms such as Janssen have also made similar bribery settlements, with other cases ongoing for firms including AstraZeneca and Teva.
Ben Adams
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