Alabama Attorney General Troy King announced Wednesday two major settlements with the drug company Pfizer Inc. totaling more than $2.2 billion.
The state of Alabama will collect a total of $2,888,464 from these settlements.
King's office calls one of the settlements "the largest health care fraud settlement in history." Under the terms of the agreement, Pfizer will pay the states and the federal government $1 billion in civil damages and penalties to compensate Medicaid, Medicare and various federal health care programs for harm suffered as a result of its conduct.
Pfizer was alleged to have paid kickbacks and engaged in off-labeling marketing campaigns that improperly promoted numerous drugs that the company manufactures.
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A second settlement totaling $33 million was related to the alleged improper marketing of the antipsychotic drug Geodon.
"Today's guilty plea and settlements underscore the need for my office to remain aggressive in our protection of consumers from pharmaceutical companies engaging in this type of conduct," King said in a release. "I am committed to continue to monitor drug companies' practices and to take appropriate action if we believe wrongdoing has occurred."
The government alleged that Pfizer, the largest pharmaceutical manufacturer in the world, engaged in a pattern of unlawful marketing activity to promote multiple drugs for certain uses which the Food and Drug Administration had not approved. While it is not illegal for a physician to prescribe a drug for an unapproved use, federal law prohibits a manufacturer from promoting a drug for uses not approved by the FDA.
In addition to that, Pfizer subsidiary, Pharmacia & Upjohn Company, Inc., has agreed to plead guilty to a felony violation of the Food, Drug and Cosmetic Act and to pay a criminal fine and forfeiture of $1.3 billion. The criminal component of the resolution, according to King's office, centers on the illegal marketing and promotion of Bextra, an anti-inflammatory drug that Pfizer pulled form the market in 2005. Because of illegal promotion, Pharmacia & Upjohn Company, Inc. has agreed to plead guilty to a felony violation of the FDCA for misbranding the drug with the intent to defraud or mislead.