Quantcast
Connect with us

Prosecutor reveals how world’s largest drug company broke the law

Published

on

Bloomberg news reports on why the acting U.S. attorney in Boston is blasting a top pharmaceutical company for engaging in “clearly criminal” actions.

“Prosecutor Michael Loucks remembers clearly when lawyers for Pfizer Inc., the world’s largest drug company, looked across the table and promised it wouldn’t break the law again,” David Evans writes for Bloomberg.

ADVERTISEMENT

It was January 2004, and the attorneys were negotiating in a conference room on the ninth floor of the federal courthouse in Boston, where Loucks was head of the health-care fraud unit of the U.S. Attorney’s Office. One of Pfizer’s units had been pushing doctors to prescribe an epilepsy drug called Neurontin for uses the Food and Drug Administration had never approved.

In the agreement the lawyers eventually hammered out, the Pfizer unit, Warner-Lambert, pleaded guilty to two felony counts of marketing a drug for unapproved uses.

New York-based Pfizer agreed to pay $430 million in criminal fines and civil penalties, and the company’s lawyers assured Loucks and three other prosecutors that Pfizer and its units would stop promoting drugs for unauthorized purposes.

What Loucks, who’s now acting U.S. attorney in Boston, didn’t know until years later was that Pfizer managers were breaking that pledge not to practice so-called off-label marketing even before the ink was dry on their plea.

Loucks tells Bloomberg news, “At the very same time Pfizer was in our office negotiating and resolving the allegations of criminal conduct in 2004, Pfizer was itself in its other operations violating those very same laws.”

“They’ve repeatedly marketed drugs for things they knew they couldn’t demonstrate efficacy for,” Loucks added. “That’s clearly criminal.”

Pfizer agreed in September to pay out a record 2.3 billion dollars to settle a high-profile fraud case, pleading guilty to a criminal charge for marketing its painkiller Bextra illegally.

The settlement by the world’s biggest drugmaker was trumpeted as a major victory by President Barack Obama’s administration in its efforts to cut down fraud as part of a major overhaul of America’s health care system.

ADVERTISEMENT

Health Secretary Kathleen Sebelius held a press conference to announce the settlement, which will end criminal and civil proceedings against Pfizer over the allegations it illegally marketed drugs for off-label purposes.

“This historic settlement will return nearly one billion dollars to Medicare, Medicaid, and other government insurance programs, securing their future for the Americans who depend on these programs,” she said in a statement.

The agreement with Pfizer is divided into several parts, the largest of which is a 1.195 billion dollar fine — the largest criminal fine ever imposed in the United States for any matter, according to the Justice Department.

ADVERTISEMENT

The company will also forfeit 105 million dollars and pay an additional one billion dollars “to resolve allegations under the civil False Claims Act that the company illegally promoted four drugs.”

The case arose from allegations that Pfizer illegally marketed Bextra, the anti-psychotic drug Geodon, the antibiotic Zyvox, and Lyrica, an anti-epileptic drug, for uses that were not approved by the Food and Drug Administration.

ADVERTISEMENT

The Justice Department had alleged that Pfizer’s inappropriate marketing “caused false claims to be submitted to government health care programs for uses that were not medically accepted indications and therefore not covered by those programs.”

The settlement also ends civil proceedings over “allegations that Pfizer paid kickbacks to healthcare providers to induce them to prescribe these, as well as other, drugs,” the Justice Department said.

Assistant Attorney General Tom Perrelli said the investigation into Pfizer’s activities illustrated that combating healthcare fraud “is one of this administration’s top law enforcement priorities.”

ADVERTISEMENT

“This case is a great example of the department’s commitment to fiscal accountability, combating fraud, and returning much-needed dollars back to the US Treasury and state treasures,” he said.

Amy Schulman, senior vice president and general counsel for Pfizer, said the drug company welcomed the settlement, which it had agreed to pay in principle back in January.

“These agreements bring final closure to significant legal matters and help to enhance our focus on what we do best — discovering, developing and delivering innovative medicines,” Schulman said, adding that the company did “regret certain actions taken in the past.”

The agreement was announced amid continuing efforts by the Obama administration to advance a healthcare reform package that faces stiff opposition.

ADVERTISEMENT

The administration has countered that a key provision of the reform package is an effort to reduce waste and fraud.

“Illegal conduct and fraud by pharmaceutical companies puts the public health at risk, corrupts medical decisions by health care providers, and costs the government billions of dollars,” said Tony West, assistant attorney general for the Justice Department’s civil division.

“This civil settlement and plea agreement by Pfizer represent yet another example of what penalties will be faced when a pharmaceutical company puts profits ahead of patient welfare.”

(with afp report)

Bloomberg’s lengthy report can be accessed at this link

ADVERTISEMENT


Report typos and corrections to: [email protected].
READ COMMENTS - JOIN THE DISCUSSION
Continue Reading

Breaking Banner

GOP scrambling to find delegates willing to attend Trump’s convention after he bailed on North Carolina: report

Published

on

On Saturday, The New York Times reported that Republicans are struggling to find delegates to attend the GOP convention.

"Adding to the uncertainty surrounding the convention is the trepidation delegates are feeling about attending a crowded gathering," reported Annie Karni and Maggie Haberman. "Already, states like Indiana are having difficulty filling both their delegate and alternate spots. Many convention delegates are over 60 and therefore more vulnerable to the virus."

Continue Reading

Breaking Banner

Jim Cramer: Coronavirus pandemic triggered ‘one of the greatest wealth transfers in history’

Published

on

CNBC's Jim Cramer said Thursday that that coronavirus pandemic has triggered "one of the greatest wealth transfers in history."

The remark from the network's "Mad Money" host came amid "ominous" economic data but a rebounding stock market.

"How can the market rebound without the economy? Because the market doesn't represent the economy; it represents the future of big business," said Cramer. "The bigger the business, the more it moves the major averages."

Continue Reading
 

Facebook

Black Lives Matter movement gains momentum worldwide with fresh weekend of protests

Published

on

From Sydney to London, Paris to Washington, D.C., protesters have launched a global weekend of action to support Black Lives Matter, in many cases defying bans on public gatherings.

Taking a knee, chanting and ignoring social-distancing measures, outraged protesters kicked off a weekend of global rallies Saturday against racism and police brutality.

The death during the arrest of George Floyd, an unarmed black man in the US state of Minnesota, has brought tens of thousands out onto the streets during a pandemic that is ebbing in Asia and Europe, but spreading in other parts of the world.

Continue Reading
 
 
You need honest news coverage. Help us deliver it. Join Raw Story Investigates for $1. Go ad-free.
close-image