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For Immediate Release:  
For Further Information:
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September 2, 2009  

Division of Criminal Justice
609-292-4791

Office of The Attorney General
- Anne Milgram, Attorney General
Division of Criminal Justice
- Deborah L. Gramiccioni, Director
Office of the Insurance Fraud Prosecutor
- Riza Dagli, Acting Insurance Fraud Prosecutor

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New Jersey to Receive $12 Million in Medicaid Fraud Settlement with Pfizer

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TRENTON - Attorney General Anne Milgram announced today that New Jersey has joined with other states and the federal government and reached agreement with Pfizer Inc to settle civil and criminal allegations that Pfizer and its subsidiaries paid kickbacks and engaged in off-labeling marketing campaigns that improperly promoted numerous drugs that Pfizer manufactures.

This is the largest settlement in history in a health care fraud matter. Pfizer will pay $2.3 billion to settle nine False Claims Act cases filed against it. Pfizer will pay the states and the federal government to compensate Medicaid, Medicare, and various federal healthcare programs .The total Medicaid portion of the settlement is $705.3 million. New Jersey’s share in the Medicaid settlement is $12,463, 555.

The settlement comes simultaneously with a separate multi-state agreement that resolved allegations Pfizer improperly marketed its anti-psychotic drug Geodon. In addition to requiring that Pfizer make certain changes in its approach to marketing Geodon, that settlement requires Pfizer to pay New Jersey $943,230.

The government entities alleged that Pfizer, the largest pharmaceutical manufacturer in the world, engaged in a pattern of unlawful marketing activity to promote multiple drugs for certain uses which the Food and Drug Administration (FDA) had not approved. While it is not illegal for a physician to prescribe a drug for an unapproved use, federal law prohibits a manufacturer from promoting a drug for uses not approved by the FDA.

This promotional activity included:

  • Marketing Bextra for conditions and dosages other than those for which it was approved;
  • Promoting the use of the antipsychotic drug Geodon for a variety of off-label conditions such as attention deficit disorder, autism, dementia and depression for patients that included children and adolescents;
  • Selling the pain medication Lyrica for unapproved conditions;
  • Making false representations about the safety and efficacy of Zyvox, an antibiotic only approved to treat certain drug resistant infections.

In addition to the improper off-label marketing of these drugs Pfizer is alleged to have paid illegal remuneration to health care professionals to induce them to promote and prescribe Bextra, Geodon, Lyrica, Zyvox, Aricept, Celebrex, Lipitor, Norvasc, Relpax, Viagra, Zithromax, Zoloft and Zyrtec. These payments allegedly took many forms, including entertainment, cash, travel and meals. Federal law prohibits payment of anything of value in exchange for the prescribing of a product paid for by a federal health care program.

As a condition of the settlement, Pfizer will enter into a Corporate Integrity Agreement with the United States Department of Health and Human Services, Office of the Inspector General, which will closely monitor the company’s future marketing and sales practices.

A National Association of Medicaid Fraud Control Units team participated in the investigation and conducted the settlement negotiations with Pfizer on behalf of the settling states. Team members included representatives from the Offices of the Attorneys General for the states of Massachusetts, Oregon, Ohio, New York, Virginia, Texas and Arkansas. The New Jersey Medicaid Fraud Control Unit is funded 75% by the federal government and 25% by the state government. The Medicaid Fraud Control Unit routinely participates in civil settlements involving allegations of false claims brought on a national level.

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