Washington State

Office of the Attorney General

Attorney General

Bob Ferguson

Sep 2 2009

Drug company will pay $2.3 billion to settle historic Medicaid fraud settlement and $33 million more to settle states’ claims of unfair and deceptive marketing practices

OLYMPIA… Attorney General Rob McKenna today announced two major national settlements with pharmaceutical giant, Pfizer Inc. 

In the first settlement, McKenna joined with other states and the federal government to reach agreement with Pfizer Inc. to settle civil and criminal allegations that Pfizer and its subsidiaries paid kickbacks and engaged in "off-label" marketing campaigns that improperly promoted numerous drugs that Pfizer manufactures.   "Off-label" refers to uses that have not been approved by the U.S. Food and Drug Administration (FDA).

“This historic settlement is the largest health care fraud settlement to date,” McKenna said. “It sends a message that states and the federal government take this kind of behavior very seriously – and allows us to recover millions for our state and federal health care plans, just when we need it the most.”

Pfizer will pay the states and the federal government a total of $1 billion in civil damages and penalties to compensate Medicaid, Medicare and various federal healthcare programs for harm suffered as a result of its conduct.

In addition, a Pfizer subsidiary, Pharmacia & Upjohn Company, Inc., has agreed to plead guilty to a felony violation of the Food, Drug, and Cosmetic Act (FDCA) and to pay a criminal fine and forfeiture of $1.3 billion. 

Washington’s share is roughly $9 million. AAG Dawn Cortez, director of Washington’s Medicaid Fraud Control Unit, facilitated the settlement for the state of Washington. For the entire news release on this settlement, please click here.

In the second settlement, 43 Attorneys General, including McKenna, reached a $33 million dollar agreement with Pfizer Inc. related to the drug company’s alleged improper marketing of the antipsychotic drug, Geodon. 

In a consumer protection complaint soon to be filed in court along with the settlement agreement, McKenna alleges Pfizer engaged in unfair and deceptive practices when it marketed Geodon for off-label uses. Pfizer has agreed to change how it markets Geodon and has agreed not to promote “off-label” uses.

“This case is consistent with the related case in that it demonstrates once again, that drug companies will be held accountable and we will not tolerate “off-label” marketing,” McKenna said.

Geodon is the brand name for the prescription drug ziprasidone. The drug has been approved by the FDA for treatment of schizophrenia in adults and for manic or mixed episodes of bipolar disorder in adults.  The state of Washington will receive $880,000 as a result of this settlement.

The Attorneys General from Delaware and Maryland led the Executive Committee States’ negotiation of the settlement of Pfizer’s marketing and promotional practices. 

The Executive Committee States for this settlement include Arizona, Colorado, Delaware, District of Columbia, Florida, Kentucky, Maryland, Massachusetts, North Carolina, Ohio, and Pennsylvania. The participating states in the settlement are: Alabama, Arkansas, Arizona, California, Colorado, Connecticut, Delaware, District of Columbia, Florida, Hawaii, Idaho, Illinois, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Missouri, Montana, Nebraska, Nevada, New Hampshire, New Jersey, New Mexico, New York, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Dakota, Tennessee, Texas, Vermont, Washington, West Virginia, and Wisconsin.

Assistant Attorney General Robert Lipson handled the second case for Attorney General McKenna’s Consumer Protection Division.  For the entire news release on this settlement, please click here.


Janelle Guthrie, AGO Communications Director, (360) 586-0725
Kristin Alexander, AGO Seattle Media Relations Manager, (206) 464-6432