COVID-19 vaccine maker Pfizer was involved in the largest healthcare fraud settlement in history in 2009
In 2009, the Wuhan coronavirus (COVID-19) vaccine maker Pfizer paid $2.3 billion in what was — and is still — the largest healthcare fraud settlement in history. This is to resolve criminal and civil liability arising from the illegal promotion of certain pharmaceutical products.
The U.S. Department of Justice fined Pfizer in September of 2009 after one of its subsidiaries, Pharmacia & UpJohn Company, pleaded guilty to marketing four drugs “with the intent to defraud and mislead.” Aside from promoting the sale of an unapproved anti-inflammatory drug, the pharmaceutical company was also penalized for making false claims to government healthcare programs and bribing healthcare providers to prescribe the said drugs.
Pfizer fined for falsely marketing drugs
Prior to pulling Bextra from the market in 2005, Pfizer had promoted its sale for several uses and dosages that the Food and Drug Administration (FDA) specifically declined to approve because of safety concerns. For this, the company and its subsidiary Pharmacia & UpJohn paid a fine of $1.195 billion. On top of this, Pfizer also had to forfeit $105 million for a total criminal restitution of $1.3 billion.
In addition, Pfizer also agreed to pay $1 billion to resolve allegations that the company had illegally promoted three other drugs besides Bextra, namely, Geodon, an anti-psychotic drug; Lyrica, an anti-epileptic drug; and Zyvox, an antibiotic. The company also 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.
A former Pfizer district sales manager was indicted and sentenced to home confinement for destroying documents regarding the illegal promotion of the drugs. Meanwhile, a regional manager pleaded guilty to distribution of a misbranded product and was fined $75,000 while being placed on 24 months of probation.
Also resolved in the civil settlement were allegations that Pfizer paid kickbacks to healthcare providers so they would prescribe the aforementioned drugs, as well as other drugs. Altogether this was the largest civil fraud settlement against a pharmaceutical company in history.
Pfizer is now making a windfall from the coronavirus vaccine
That Pfizer was involved in the largest pharmaceutical fraud claim in history is important, as the company begins to roll out its new vaccine against COVID-19. To cover the cost of inoculating 50 million people, the U.S. government is paying the company and its German partner, BioNTech, nearly $2 billion – a few hundred million shy of what the company paid back in 2009. Related: (“We have a winner”: Trump administration inks $1.95-billion coronavirus vaccine deal, forcing taxpayers to enrich evil pharma giants.)
The contract is the most that the U.S. government has agreed to spend on a vaccine, though previous deals with other vaccine makers were intended to help pay for development costs. But for Pfizer to get paid, the vaccine had to succeed in large clinical trials, which it reportedly did. The jab has recently received emergency approval from the FDA and mass vaccination in America is now underway.
Since settling with the government, Pfizer representatives have claimed that the company has reformed.
“The reasons to trust Pfizer are because, as I have walked the halls at Pfizer, you would see that the vast majority of our employees spend their lives dedicated to bringing truly important medications to patients and physicians in an appropriate manner,” said Amy W. Schulman, Pfizer general counsel, back in 2009.
As part of the settlement, the company entered into an expansive corporate integrity agreement with the Office of the Inspector General of the Department of Health and Human Services. This agreement ensures that procedures and reviews are in place to prevent a repeat of the company’s previous misconduct.
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