The drug maker Pfizer agreed to pay $491 million to settle criminal and civil charges over the illegal marketing of the kidney-transplant drug Rapamune, the Justice Department announced on Tuesday.
The recent case centers on the practices of Wyeth Pharmaceuticals, which Pfizer acquired in 2009.
Rapamune, which prevents the body’s immune system from rejecting a transplanted organ, was approved by the Food and Drug Administration in 1999 for use in patients receiving a kidney transplant. However, federal officials said Wyeth aggressively promoted the drug for use in patients receiving other organ transplants, even offering financial incentives to its sales force to do so.Accusations of Wyeth’s practices became public in 2010 after a whistle-blower lawsuit filed by two former employees was unsealed.After lawmakers announced a Congressional inquiry, the Justice Department opted to join the lawsuit. The settlement announced Tuesday, which also resolves a second, similar whistle-blower suit, includes a criminal fine and forfeiture of $233.5 million, and a civil settlement of $257.4 million with the federal government, all 50 states and the District of Columbia.
The case did not get much media coverage. So far, the only other somewhat detailed article on it was put out by Bloomberg. In fact, the lawyer for two of the whistle-blowers who alerted federal authorities to what Wyeth was doing had to say
the spate of pharmaceutical settlements in recent years had blunted reaction to what he said were shameful practices. 'Everybody’s been asking me why this case is different than any other,' he said. 'We used to trust these companies. You can’t trust these companies anymore.'
However, we should not be too blase. This case was not only about money. The over-promotion of a potentially dangerous drug likely lead to patients being harmed in the absence of any benefits. Rapamune suppresses the immune system and increases risks of serious infections and malignancy. Specific serious adverse events have been reported when it is used in transplants of organs other than the kidney (e.g., lung and liver transplants). (See full prescribing information here.) Bloomberg reported that 90% of Wyeth's revenues from Rapamune came from off-label uses, suggesting that quite a few people may have been adversely affected by its excess use.
As in most other members of the march of legal settlements by big health care organizations, this case involved no negative consequences for anybody who authorized, directed, or implemented the improper marketing practices. While such people must have existed, they were not even named in the press coverage. At least this settlement involved a guilty plea to a crime, albeit a misdemeanor (misbranding as reported by Bloomberg), so the company did have to admit some wrongdoing.
A Pfizer manager, however, tried to disavow responsibility, as noted by Bloomberg,
'Pfizer was not a subject or target of this matter, and cooperated fully with the government from the time it learned of this investigation in October 2009,' Chris Loder, a Pfizer spokesman,...
But Pfizer had purchased Wyeth, and in doing so got not only assets and profits, but responsibility for actions.
Also, neither the settlement nor the criminal plea seemed to take into account Pfizer's amazingly sorry recent track record. I am losing count of all of Pfizer's settlements and/or guilty plea or convictions since 2000. (The updated list of previous legal results is in the Appendix.)
People found guilty of small-time Medicaid or Medicare fraud often forfeit all their assets and go to jail. Yet actions by large pharmaceutical companies that may harm patients and cost many millions of dollars almost never result in any individual facing any negative consequences, or even being named and shamed. Meanwhile, the managers of these companies may make gargantuan amounts of money partially rationalized by the revenues produced by such recurrent misbehavior. In 2012, according to the company's 2013 proxy filing, Pfizer CEO Ian Reed's total compensation was $25,634,136, and the four next most highly paid executives all made more than $5,000,000.
So the Kabuki play that is regulation of and law enforcement for large health care organizations goes on. As our society is being increasingly divided into a huge majority in increasingly difficult economic circumstances and a small and increasingly rich minority, it also seems to be increasingly divided into little people who may be ruined by lawsuits, and imprisoned for even minor infractions, and big people who have impunity.
True health care reform would need to start by making leaders of big health care organizations accountable for their organizations' misbehavior.
APPENDIX - Pfizer's Settlements