by Christopher Freeburn | July 31, 2013 8:53 am
On Tuesday, the U.S. Justice Department announced that it had negotiated a settlement of charges stemming from improper sales practices by a major pharmaceutical giant.
The deal, which settles civil and criminal claims arising from the marketing of a kidney-transplant treatment, will cost Pfizer (PFE) $491 million. The company took a charge for cost of the settlement during last year’s third quarter in anticipation of the deal, the New York Times noted.
Charges against Pfizer stemmed from the improper marketing of Rapamune by Wyeth Pharmaceuticals, which Pfizer purchased in 2009. Though the Food and Drug Administration (FDA) had cleared the drug only for use in patients who had received a kidney transplant, Wyeth promoted it to patients who had received other organ transplants as well.
The government alleged that Wyeth encouraged its sales team to market the drug beyond its FDA approval by providing incentives. The government noted that Pfizer had cooperated in the investigation.
In 2009, Pfizer paid $2.3 billion to settle charges that it improperly promoted a number of other drugs.
Shares of Pfizer rose fractionally in pre-market trading on Wednesday.
Source URL: http://investorplace.com/2013/07/pfizer-to-pay-491m-over-illegal-marketing-of-kidney-drug/
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