Pfizer unit pleads guilty, agrees to pay $491M in off-label marketing case

The ink is dry on Pfizer's ($PFE) latest off-label marketing settlement. The company's Wyeth unit agreed to pay $491 million in criminal and civil penalties to wrap up allegations that it marketed the kidney-transplant drug Rapamune for patients who received other types of organs. The settlement ends a longstanding probe that Pfizer inherited when it bought Wyeth in 2009.

According to the Justice Department, Wyeth trained sales reps to push Rapamune for unapproved uses and offered bonuses to persuade them to flog the drug for patients it wasn't cleared to treat. "This was a systemic, corporate effort to seek profit over safety," U.S. Attorney Sanford Coats said in a statement. "Companies that ignore compliance with FDA regulations will face criminal prosecution and stiff penalties."

Under the settlement agreement, Pfizer's Wyeth unit pleaded guilty to a criminal misbranding violation under the Food, Drug and Cosmetics Act. The deal includes a criminal fine of $157.58 million and asset forfeiture amounting to $76 million, or $233.5 million total. Civil payments to the government and states add another $257.4 million. Grand total: $490.9 million.

The settlement stems from a whistleblower suit filed by two former Wyeth sales reps. The feds joined that case back in 2010, and at the time, Pfizer said it welcomed the government's involvement. "[W]e believe its doing so will allow for a more orderly process and efficient conclusion" of the lawsuit and the federal probe, the company said. After all, the alleged misconduct didn't extend past 2007, Pfizer pointed out, two years before it bought Wyeth.

Wyeth's legacy may be to blame here, but Pfizer is no stranger to off-label marketing settlements. It agreed to pay $2.3 billion in criminal and civil penalties to settle off-label marketing allegations involving Bextra and a handful of other drugs. That settlement includes the biggest criminal penalty in a drug-marketing case. The latest deal is, obviously, less than one-fifth of that previous settlement, and it's not big enough to qualify for FiercePharma's Top 11 Marketing Settlements list.

- see the Justice Department release

Special Report: Pharma's Top 11 Marketing Settlements