It paid nearly $1.2 billion in criminal fines for the way it pushed Bextra – the largest fine the U.S. government has ever collected from a drug company. It paid a billion dollars more to settle a batch of civil suits – although it denied wrongdoing – on allegations that it illegally promoted 12 other drugs. In all, Pfizer, the world’s biggest drug company, lost the equivalent of three months’ profit.
The story began in 2001, when Pfizer’s painkilling drug Bextra was about to hit the market. The drug was part of a revolutionary class of painkillers known as Cox-2 inhibitors that were supposed to be safer than generic drugs, but at 20 times the price of ibuprofen.
Pfizer and its marketing partner, Pharmacia, planned to sell Bextra as a treatment for acute pain, the kind you have after surgery. But in November 2001, the U.S. Food and Drug Administration said Bextra was not safe for patients at high risk of heart attacks and strokes.
The FDA approved Bextra only for arthritis and menstrual cramps. It rejected the drug in higher doses for acute, surgical pain.
Promoting drugs for unapproved uses can put patients at risk by circumventing expert medical approvals about which products are safe and effective. For that reason, this “off-label” promotion of drugs is against the law.
But by the time Bextra was taken off the market four years later, more than half of its $1.7 billion in profits had come from prescriptions written for uses that the FDA had rejected.
Internal Pfizer documents show that Pfizer and Pharmacia (which Pfizer later bought) used a multimillion dollar medical education budget to pay hundreds of doctors as speakers and consultants to tout Bextra for these off-label uses. In fact, an internal marketing plan called for training physicians “to serve as public relations spokespeople.”
According to Lewis Morris of the U.S. Department of Health and Human Services:
“They pushed the envelope so far past any reasonable interpretation of the law that it’s simply outrageous.”
But when it came to prosecuting Pfizer for this fraudulent marketing, the pharmaceutical giant had a trump card: just as the giant banks on Wall Street were deemed too big to fail, Pfizer was considered too big to nail.
Because any company convicted of a major health care fraud is automatically excluded from Medicare and Medicaid in the U.S. Convicting Pfizer on Bextra would prevent the company from billing federal health programs for any of its products. It would be a corporate death sentence.
Prosecutors said that excluding Pfizer would most likely lead to Pfizer’s collapse, with collateral consequences:
- disrupting the flow of Pfizer products to Medicare and Medicaid recipients
- causing the loss of jobs including those of Pfizer employees who were not involved in the fraud
- causing significant losses for Pfizer shareholders.