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Pfizer offered a major “mea culpa” last week when it agreed to pay $2.3 billion in fines for the “largest combined federal and state health care fraud settlement in the history of the Department of Justice.” The pharmaceutical company has ended up in this less than esteemed position as a result of its marketing of numerous drugs, including Bextra, Geodon, Zyvox, and Lyrica, for uses not previously approved by the FDA (called off-label uses), and at doses higher than any approved level. The settlement accounts for both criminal and civil violations related to fraudulent marketing, including improper kickbacks, to physicians.
Federal law prohibits pharmaceutical companies from marketing FDA-approved drugs for any use other than their approved use, although physicians may prescribe drugs for off-label uses once the FDA has approved the drug for some purpose. Pfizer utilized numerous marketing techniques to promote off-label uses of its drugs, such as fabrication of requests from physicians about medications so that it could send information to the physicians about these unapproved uses.
Pfizer also offered remuneration to physicians, such as vacations, and offered physicians positions on advisory boards so that it could further market its drugs for off-label uses and encourage physicians to prescribe these drugs for off-label uses. Many universities and hospitals have recently cracked down on the ability of pharmaceutical companies to directly market their drugs to physicians on the institution’s premises. Stanford University imposed such a ban back in 2006, and the University of Iowa enacted a similar policy in early 2009. Furthermore, the Anti-Kickback Statute specifically prohibits physicians from receiving remuneration in exchange for prescribing particular drugs.
This large settlement follows Pfizer’s 2004 settlement with the federal government for a much smaller sum–$430 million–resulting from its off-label promotion of the drug Neurontin. The FDA approved Neurontin to treat seizures, but the company marketed it for pain management and treatment of psychiatric conditions.
The fact that these large settlement sums will not sink the pharmaceutical giant confirms the high demand that exists for Pfizer’s drugs, as Pfizer has clearly earned enough money from the sale of its pharmaceuticals to cover the cost of such settlements. Given this high demand, as well as the high cost for such “unorthodox” marketing techniques, large pharmaceutical companies are likely better off undertaking–without hesitation–the clinical trials necessary to determine the safety and efficacy of drugs for their off-label uses. Clinical trials are expensive and time consuming, and waiting for clinical trial results may cut into profit margins; but, as we have now seen, so do federal lawsuits and the potential resulting penalties.
– Lauren Solberg
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