{"id":12263,"date":"2016-09-09T16:20:00","date_gmt":"2009-09-09T16:20:00","guid":{"rendered":"http:\/\/www.accessrx.com\/blog\/?p=59"},"modified":"2009-09-09T16:20:00","modified_gmt":"2009-09-09T16:20:00","slug":"2-3-billion-fine-chump-change-for-pfizer","status":"publish","type":"post","link":"https:\/\/www.edrugstore.com\/blog\/erectile-dysfunction\/2-3-billion-fine-chump-change-for-pfizer\/","title":{"rendered":"Viagra ED Medication Manufacturer Pfizer Hit with $2.3 Billion Fine"},"content":{"rendered":"

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Many prescription drugs, including Viagra, are fairly expensive.<\/figcaption><\/figure> The damage to Pfizer had already been done when the New York Times <\/em>and many other news agencies covered a dog-and-pony press conference last week at the White House. There, Kathleen Sebelius, secretary of health and human services, patted the backs of her fellow bureaucrats as they celebrated the $2.3 settlement that Pfizer already agreed to put on its books in the final quarter of 2008.<\/p>\n

However, it did serve its purpose to remind the world of what the Times<\/em> called the largest health care fraud settlement and the largest criminal fine of any kind \u2013 ever. Wow, these Pfizer people must have really done it THIS<\/em> time.<\/p>\n

What, you ask? Pfizer has been in this boat before? Well, actually this was Pfizer\u2019s fourth settlement regarding illegal marketing activities since 2002. Which is a point a couple of Forbes editors accidentally missed, apparently, in this truly entertaining column<\/a> posted yesterday. Still, their argument has its merits. Pfizer DID NOT really do it this time, the editors say \u2013 unless you count the hurt feelings at the FDA worth anything.<\/p>\n

The headline in the New York Times<\/em><\/a> last week read just like the headlines did when the settlement came to light many months ago: \u201cPfizer Pays $2.3 Billion to Settle Marketing Case Wholesalers.\u201d This probably made a few people ask the questions, \u201cIs Pfizer in trouble and how can they absorb such a fine\u2026 What does $2.3 billion mean to a Big Pharma company like Pfizer?\u201d<\/p>\n

Well, here are your answers, in reverse order, just to spice things up\u2026<\/p>\n

1)\u00a0 For full-year 2008, Pfizer recorded reported revenues of $48.3 billion (not bad considering it includes the $2.3 billion penalties), essentially flat compared with 2007 full-year revenues of $48.4 billion.<\/p>\n

So the fine equals less than 5 percent of annual revenues. And we\u2019re not sure if you\u2019ve been tracking price increases recently, but Pfizer began to raise the cost of Viagra\u00a0twice a year instead of once a year in 2007. Including the last six price increases since Jan. 1, 2007, the price of Viagra has gone up 45.5%.\u00a0 This means that online\u00a0pharmacies, such as eDrugstore.com, have\u00a0also raised the price of Viagra online<\/a> to keep up with Pfizer’s increases.<\/p>\n

Let\u2019s put it this way, Pfizer will continue to find ways to be profitable, including its expected purchase of Wyeth for $68 billion. Makes the fine almost seems like play money, doesn\u2019t it? Makes you wonder if all of these \u201ccorporate integrity agreements\u201d that the feds make Pfizer sign are used as placeholders or scratch paper.<\/p>\n

2) Pfizer does not appear to be in trouble, and the fine can be \u201cabsorbed\u201d if not replaced with additional streams of new revenue. The company\u2019s stock bottomed out below $12 per share in late February, about a month after the company\u2019s 2008 revenue reports were released. The shares climbed to above $16 in July, where they remain in early September.<\/p>\n

It seems Pfizer\u2019s track record indicates a profound ability to recover from similar and repeated misdoings, fines and even White House press conferences. Some of the facts surrounding the case are still somewhat disconcerting\u2026<\/p>\n

To borrow a line from the Times<\/em>: \u201cJohn Kopchinski, a former Pfizer sales representative whose complaint helped prompt the government\u2019s Bextra case (which cost Pfizer $1.3 billion of the settlement), said that company managers told him and others to dismiss concerns about (another drug being marketed improperly) while pushing them to undertake similar illegal efforts on behalf of Bextra.<\/p>\n

\u2018The whole culture of Pfizer is driven by sales, and if you didn\u2019t sell drugs illegally, you were not seen as a team player,\u2019 said Mr. Kopchinski, whose personal share of the Pfizer settlement is expected to exceed $50 million (thanks to a Civil-War era law that pays bounties to whistleblowers). Mr. Kopchinski left Pfizer in 2003.\u201d<\/p>\n

Of course, Pfizer is not alone among pharmaceutical companies who have settled or been told, to pay huge amounts of money. And the other companies are not hard to find. In fact, there are numerous industry blogs that track these and other pharma stories. For a good pharma carnival blog review that provides weekly insight, check out\u00a0 http:\/\/blog.pharmalive.com.<\/p>\n","protected":false},"excerpt":{"rendered":"

The damage to Pfizer had already been done when the New York Times and many other news agencies covered a dog-and-pony press conference last week at the White House. There, Kathleen Sebelius, secretary of health and human services, patted the backs of her fellow bureaucrats as they celebrated the $2.3 settlement that Pfizer already agreed […]<\/p>\n","protected":false},"author":1,"featured_media":5851,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_autoblog_aioseo_focus_keyphrase":"","_autoblog_aioseo_title":"","_autoblog_aioseo_description":"","footnotes":""},"categories":[20],"tags":[],"class_list":["post-12263","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-erectile-dysfunction"],"acf":[],"aioseo_notices":[],"aioseo_head":"\n\t\t\n\t\n\t\n\t\n\t\n\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t