Pfizer Inc. and Pharmacia & Upjohn Company Inc., a subsidiary of Pfizer Inc., have agreed to pay a total of $2.3 billion to settle various criminal and civil charges, according to an announcement made today by the United States Department of Justice. This constitutes the biggest settlement for healthcare fraud ever reached by the Department of Justice in its entire history.

Misbranding Bextra, an anti-inflammatory medication, with the aim to deceive or mislead customers was a violation of the Food, Drug, and Cosmetic Act, which Pharmacia & Upjohn Company has agreed to plead guilty to in exchange for a reduced sentence. The criminal resolution for the corporation includes a fine of $1.195 billion and the forfeiture of $105 million, bringing the total amount paid to resolve the case to $1.3 billion.

In addition, Pfizer has come to an agreement to pay $1 billion in order to settle allegations that the company engaged in the unethical promotion of four different medications. These medications include Bextra, Geodon (which is an anti-psychotic), Zyvox (which is an antibiotic), and Lyrica (which is an anti-epileptic). Additionally, the corporation has been accused of being responsible for the submission of bogus claims to government healthcare programs for purposes that were not acknowledged by the medical community and were thus not covered by the programs.

Pfizer has agreed, as part of the settlement, to engage in a corporate integrity agreement with the Office of Inspector General of the Department of Health and Human Services. The purpose of this agreement is to avoid future behavior that is comparable to the previous one. Over the course of the investigation, there were six individuals came forward with information that led to a civil recovery of more than $102 million.

Associate Attorney General Tom Perrelli stated that “today’s landmark settlement is a testament to the type of broad, coordinated effort among federal agencies and with our state and local partners that is at the core of the Department of Justice’s approach to law enforcement.” “Today’s landmark settlement is a testament to the type of broad, coordinated effort among federal agencies and with our state and local partners,” said Perrelli. According to Kathleen Sebelius, who serves as the Secretary of the Department of Health and Human Services, “This historic settlement will return nearly one billion dollars to Medicare, Medicaid, and other government insurance programs, securing the future of these programs for the Americans who depend on these programs.”

According to Tony West, Assistant Attorney General for the Civil Division, “Illegal activity and fraud by pharmaceutical firms puts the public health in jeopardy, corrupts medical judgments made by health care practitioners, and costs the government billions of dollars.” According to Mike Loucks, the acting United States Attorney for the District of Massachusetts, “the scale and harshness of this settlement, particularly the enormous criminal punishment of $1.3 billion, reflect the seriousness and extent of Pfizer’s offenses.”

News from 2009.

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