Pfizer: How to Win or Lose the Lottery

What does it take to win the lottery? So much money that you get to pay the cost of the U.S. government for a few hours. If you are a pharmaceutical company, you could invite doctors to a retreat, pay for golf and massages. If you are unlucky enough to be Pfizer (PFE) and told the doctors about “off-label” uses for four of your drugs, you would be fined $2.3 billion dollars.

It is legal to use drugs “off-label.” After all, do you take an aspirin once a week? It is illegal for a drug company to market a drug for an “off-label” use. Two sales managers were blamed, and have left the company. This was the largest fine ever paid by a drug company. The criminal fine part, $1.2 billion is the largest ever in U.S. criminal history. ABC News has the story on the Record $2.3 Billion Fine.

Pfizer is currently valued by the market at $110 billion, so the government just seized about 2% of the shareholders value. Should we be upset that a company and employee’s tried to bend the rules? Is it wrong for the company to work to increase sales? Should the four “whistleblowers” that will share $102 million in rewards be thanked, or should they be ashamed of themselves?

Every company should do all it can to increase sales, legally. I dare say every one of the self-righteous justice department lawyers that prosecuted this case, would cry like babies for a little Bextra (painkiller) if it provided relief after an operation, and other drugs didn’t work. But, how would their doctors know if a salesman didn’t tell them other doctors were using Bextra for other uses than just arthritis pain.

I followed a couple of rules when I worked for someone else, a long time ago. As long as they are signing my check, I will do what they tell me, and keep my mouth shut. These rules are hard learned, believe me, I have four daughters. Nevertheless, they are important lessons to internalize. What gives one individual the right to supplant his values or determination in place of his employers? If you believe your employer is acting unethically or illegally, why not quit? Find a job for an angel, someone else or another company that aligns with your values and ideas about how a business should be run.

This is exactly why I went in business for myself at the tender age of twenty-four. I had no experience, but a burning desire to do it my way and never feel I had to compromise my integrity. Do I regret it, no? Will the “whistle-blowers” regret their actions? I hope so; they have become a pawn in the government’s monitoring of our lives and liberty.

Let me say, I think it is important to comply with all laws, not just the one’s you agree with. Unless the law has to do with speeding, smoking, wearing seat belts, motorcycle helmets, open containers and pay-offs to foreign bureaucrats when that is the only way to get anything done. Do I, or have I broken any of these laws? Yes, but….

Before you get angry with me, remember you are going to pay this fine. If you own shares in PFE, YOUR money. If you ever take any of their drugs, the price just went up! Come to think of it. It would be sweet for the Chairman Mr. Jeffery Kindler to order the check delivered by currier to the Justice Department. Next Monday, double the price off all drugs to the government and all prescriptions paid by any government program.

If you have not read “Atlas Shrugged” Mr. Kindler, I will send you a copy. You may also want to read “The Road to Serfdom” by F.A. Hayek, before you prostrate yourself in the White House thinking you will gain any favor with “world improvers.”

Disclosure: No position

Comments

[workfaster:]

FTA: "But, how would their doctors know if a salesman didn’t tell them other doctors were using Bextra for other uses than just arthritis pain."
===============
Your comments are completely off-base and potentially dangerous. Doctors can share off-label recommendations with other doctors. Doctors are qualified to make these recommendations, and to determine whether to use them. However, doctors expect salespeople to strictly discuss on-label indications only. If salespeople start illegally providing off-label recommendations, a doctor could easily confuse the message as being legitimate and accidentally kill someone.

In the future, please don't confuse the fact that you've read Ayn Rand with wisdom or enlightenment. Her book obviously hasn't helped make you as smart or perceptive as you think it did.

Sep 04 03:35 PM

[desicon:]

Workfaster: You missed the whole point of the article instead focused on a technical detail.

Medicines and human body do not function linearly. That is why most medicines have some adverse side effect; their overall benefits significantly outweigh the side effects. Punishing PFE with $1.2 billion will have more negative impact in terms of cost going up to make up the loss and restricted knowledge sharing thereby denying benefit to patients. Economically $1.2 billion is siphoned from private hands to government.

A lawyer CEO for the world largest pharmaceuticals company, go figure.

Sep 04 04:57 PM

[workfaster:]

Desicon: The point of my post was that laws are there for a reason- to protect the consumer/patient. Paying fines to the government is not equivalent to "prostrating yourself in the White House". It's a punishment for illegal behavior. I pay my speeding tickets. Pfizer should pay theirs.
Your excuse that Pfizer's fine ultimately hurts patients is laughable. If they were able to simply raise prices arbitrarily and with no loss in demand to cover this fine, believe me, they would have done so long ago and well before this was ever a concern...
And regarding "restricted knowledge"?? Doctors have this covered just fine, and sales reps simply aren't qualified to have this discussion. Many have a hard enough time with the on-label recommendations. I shudder to think of a world where sales reps could say whatever they wanted to about their drug. (Heck, why stop there? Why couldn't the drug companies bypass the FDA and just make whatever claims they felt like directly on their labels?) You'll just have to trust me on this one.
Finally, regarding the "siphoning", get used to it. Our country is in debt big time. We'll have to start paying it back eventually.

Sep 04 07:29 PM

[workfaster:]

Desicon: The point of my post was that laws are there for a reason- to protect the consumer/patient. Paying fines to the government is not equivalent to "prostrating yourself in the White House". It's a punishment for illegal behavior. I pay my speeding tickets. Pfizer should pay theirs.
Your excuse that Pfizer's fine ultimately hurts patients is laughable. If they were able to simply raise prices arbitrarily and with no loss in demand to cover this fine, believe me, they would have done so long ago and well before this was ever a concern...
And regarding "restricted knowledge"?? Doctors have this covered just fine, and sales reps simply aren't qualified to have this discussion. Many have a hard enough time with the on-label recommendations. I shudder to think of a world where sales reps could say whatever they wanted to about their drug. (Heck, why stop there? Why couldn't the drug companies bypass the FDA and just make whatever claims they felt like directly on their labels?) You'll just have to trust me on this one.
Finally, regarding the "siphoning", get used to it. Our country is in debt big time. We'll have to start paying it back eventually.

Sep 04 07:29 PM

[User 482210:]

workfaster:
You make fair points. The law should not be broken, and if it is there should be consequences. But do not overlook the fact that the government is very arbitrary about the way it applies the rule of law.
Currently, managed care companies are not just recommending, but actually requiring, physicians to prescribe medications off-label even when on-label medications exist and physicians want to use them. In the case of fibromyalgia, three FDA approved medications exist to treat this disorder and plans like Blue Shield of California are currently requiring patients and physicians to fail on multiple non-FDA approved medications before access is provided to the FDA drugs. Why is this allowed? Why are managed care companies allowed to overrule the FDA? Why are managed care companies being allowed to do with impunity what has just caused Pfizer the biggest government fine in US history? Why are managed care plans allowed to overrule physicians with algorithms that don't take into account the individual differences of how patients response to different medications? Clearly something is amiss here.
If the government was truly sincere in protecting patients it would launch an immediate investigation into current practices by the managed care industry that are causing more harm than Pfizer ever has by promoting Bextra for acute pain, as opposed to osteoarthritic pain.
Finally, when Americans wonder why medicines are so expensive in this country, this is one reason to not overlook. Simply, in the U.S., the costs of doing business are far greater than in any other country in the world. In effect, this is one of the ways Uncle Sam establishes price controls.

Sep 04 09:08 PM

[a. palmer jr.:]

The point, in my opinion, is that Pfizer's reckless behavior is hurting the shareholder's value. People read about the 2.3 billion dollar fine and down goes the stock price! I've held a small amount of Pfizer stock for a little over a year and watched the stock price go down about 6 dollars a share and the dividends slashed by 50%. You wonder how much they can continue to self-destruct the company and my and others' portfolio if given another year.

Sep 05 09:27 AM

[No Leaf Clover:]

John, great article...this will just be the beginning of the U.S. Government imposing huge fines on businesses to help cover the deficit and pay for even more government services that are so efficiently and effectively run.

Sep 05 11:02 AM

[Chiroworks:]

That is nonsense. The overall benefit do not out weigh the costs. There are many potentially deadly side effects from taking drugs and I am personally happy with the out come. Infact, I wish it was 110 billion. How dare they risk lives in attempt to make profits.


On Sep 04 04:57 PM desicon wrote:

> Workfaster: You missed the whole point of the article instead focused
> on a technical detail.
>
> Medicines and human body do not function linearly. That is why most
> medicines have some adverse side effect; their overall benefits significantly
> outweigh the side effects. Punishing PFE with $1.2 billion will have
> more negative impact in terms of cost going up to make up the loss
> and restricted knowledge sharing thereby denying benefit to patients.
> Economically $1.2 billion is siphoned from private hands to government.
>
>
> A lawyer CEO for the world largest pharmaceuticals company, go figure.

Sep 05 08:00 PM

[Chiroworks:]

Well said. Sad to think a drug company. or responder on this board would put profits before people. The drug companies are laughing at the fines, as they have made 50 times that pushing the drugs


On Sep 04 07:29 PM workfaster wrote:

> Desicon: The point of my post was that laws are there for a reason-
> to protect the consumer/patient. Paying fines to the government is
> not equivalent to "prostrating yourself in the White House". It's
> a punishment for illegal behavior. I pay my speeding tickets. Pfizer
> should pay theirs.
> Your excuse that Pfizer's fine ultimately hurts patients is laughable.
> If they were able to simply raise prices arbitrarily and with no
> loss in demand to cover this fine, believe me, they would have done
> so long ago and well before this was ever a concern...
> And regarding "restricted knowledge"?? Doctors have this covered
> just fine, and sales reps simply aren't qualified to have this discussion.
> Many have a hard enough time with the on-label recommendations. I
> shudder to think of a world where sales reps could say whatever they
> wanted to about their drug. (Heck, why stop there? Why couldn't the
> drug companies bypass the FDA and just make whatever claims they
> felt like directly on their labels?) You'll just have to trust me
> on this one.
> Finally, regarding the "siphoning", get used to it. Our country is
> in debt big time. We'll have to start paying it back eventually.

Sep 05 08:04 PM

[a. palmer jr.:]

I wish the drug companies would act responsibly also. When I bought the few shares of Pfizer that I have I thought they were the good guys! I just wish that sometime I'll buy a stock and it'll be just as I thought it was. My fault I guess; I should do a little more research before I even think about buying a stock. Corporate bonds are just about as bad. Ask the GM guys.

Sep 10 02:52 PM