Drug maker Pfizer, Inc. led the news with two announcements this week:Â It took a record-breaking hit of $2.3 billion over investigations into its improper marketing of the painkiller <"http://www.yourlawyer.com/topics/overview/bextra">Bextra and other medications and it is acquiring its rival, Wyeth, for $68 billion, reported Bloomberg News.Â Pfizer recalled Bextra in 2005 over a rare skin condition and at the urging of the U.S. Food and Drug Administration (FDA).
Pfizer reached the $2.3 billion agreement with the Massachusetts U.S. Attorney to, it said, â€œresolve previously disclosed investigations” regarding Bextra and “other open investigations,” reported Bloomberg, which added that while Pfizer disclosed no other details, its fourth-quarter earnings dropped a massive 90 percent over the charges and investigation.Â The Wall Street Journal blog (WSJ) noted that Pfizerâ€™s fourth-quarter earnings dropped to $266 million from $2.72 billion the prior year.
According to Bloomberg News, the Pfizer settlement is the largest for allegations of off-label marketing practices, a topic of concern to consumers, the medical community, and patient advocates.Â The prior record had occurred earlier this month when Eli Lilly & Company paid out $1.42 billion over its antipsychotic Zyprexa, said Patrick Burns of Washington advocacy group Taxpayers Against Fraud, reported Bloomberg.Â Pfizer spokesman, Christopher Loder, explained that the $2.3 billion settlement represents an “agreement in principle to resolve government allegations of past off-label practices,” said Bloomberg, noting that Loder refused to say what other investigations were covered.
The WSJ noted that Pfizer couched the settlement news around its Wyeth purchase, but noted that Pfizer also agreed to pay $745 million for agreements in principle to settle personal injury suits over painkillers Bextra and Celebrex, late last year.Â FT.com said that amid news of the Wyeth takeover, a â€œtiny referenceâ€ was made in Pfizerâ€™s fourth-quarter results issued on Monday that mentioned the record-breaking $2.3 billion agreement in principle.Â Also, said WSJ, there was $60 million for attorneys general in 33 states and the District of Columbia, and $89 million to resolve class actions, which were not included in the â€œinvestigation by the Department of Justice of the marketing of the companyâ€™s Cox-2 medicines, particularly Bextra,â€ Pfizer said in a recent quarterly filing, reported the WSJ.
Pfizer has also beeh hit hard by a number of other factors, said the Journal, including competition with the generic version of allergy medication Zyrtec and reports about odd and controversial reactions to Chantix, its smoking cessation medication.Â Chantix sales dropped by $36 percentâ€”to $180 millionâ€”when stories of bizarre reactions to the medication began surfacing and making the news.Â To make matters worse, said the WSJ, the combined Pfizer-Wyeth will be reducing staff by 10 percent, which is part of a larger 15 percent reduction.Â The workforce reduction translates into about 19,500 jobs.
Pfizer acquired Bextra in a takeover of Pharmacia, which was finalized in 2000, reported FT.com.Â Bextra, a Cox-2 painkiller is in the same class as Merckâ€™s Vioxx, which was withdrawn in 2004 following reports that Vioxx was linked to an increased incidence of heart attacks.Â Meanwhile, Pfizerâ€™s Celebrex, another Cox-2 painkiller, which was associated with skin infections and concerns over cardiac risk pushed the FDA to seek the drugâ€™s withdrawal, said FT.com.