Pfizer Inc. has agreed to pay $784.6 million to resolve a 14-year old lawsuit, announces the US Department of Justice on Wednesday. The suit accuses Pfizer and its Wyeth unit for overcharging the government through concealing rebate information that they provided to the hospitals. The rebate has been offered for drugs used in treating acid related damage to the digestive systems.
The Department of Justice alleges that Wyeth has knowingly reported inflated prices for two of its anti-acid drugs- Protonix Oral and Protonix IV. Notably mentioning, Pfizer has acquired Wyeth in 2009 i.e., the acquisition has been made three years after the fraudulence committed, reports Bloomberg.
Doug Lanker, executive vice president and general counsel for Pfizer, has expressed his pleasure on finalizing the agreement to resolve pending cases. Accusations have been made over the acts conducted at least 10 years ago and well before acquiring Wyeth by Pfizer. The resolution reflects Pfizer's intention to put these historic cases behind while focusing on the needs of patients, reports Reuters quoting Lankler.
Pharmaceutical companies are in obligations for offering discounts on drugs under Medicaid program to represent the best prices. Drug-makers usually hide or manipulate these prices through concealing discount related information to the program. The settlement also resolves a case filed under the False Claims Act by two whistle blowers, Lauren Kieff and William St. John LaCorte. The act allows citizens to sue on behalf of the government and share in any recovery made under the suit. The duo will share $98.1 million against total recovery of $784.6 million, reports Chicago Tribune, quoting Justice Department. According to the settlement agreement, LaCorte, a physician in New Orleans, will get $64 million with accrued interest against his lawsuit filed in 2002. Meanwhile, Kieff, a former hospital sales representative in Massachusetts for AstraZeneca Plc will share the rest for his suit filed in 2003. LaCorte considers the lawsuit as his get-rich-quick scheme enduring 14 years, informs the Physician while expressing reaction in a telephonic interview. He has also earned from his previous whistle-blowing act against Merck & Co. The company has agreed to pay $649 million against federal and state claims on drug pricing in 2008. From the recovered amount in Merck case, he has reportedly shared $34 million while winning other cases involving drug-makers. On the contrary, Kieff has been marketing competing drugs for AstraZeneca. He has cherished a strong belief that Wyeth has been enjoying unfair advantage, informs her attorney, Jeanne Markey.
