Move over Wal-Mart; there’s a new FCPA violator in town. Pfizer Inc. will pay $60 million to settle allegations that its subsidiaries bribed foreign health care professionals in an effort to increase business.
The Securities and Exchange Commission (SEC) and the Department of Justice (DOJ) were both investigating reports that, for more than a decade, Pfizer employees in Bulgaria, China, Croatia, the Czech Republic, Italy, Kazakhstan, Russia and Serbia paid overseas officials to endorse the company’s products and grant them regulatory approval. Among the more colorful allegations in the SEC complaint are reports that Pfizer employees gave cell phones, reading glasses and tea sets to government doctors in China, and took Russian officials on “motivational trips” to boost pharmaceutical sales.
Pfizer and a subsidiary, Wyeth LLC, will pay a combined $45 million in two separate settlements with the SEC. Pfizer H.C.P. Corp. will also pay a $15 million penalty to end a DOJ investigation into the FCPA violations.
Pfizer itself alerted regulators to several improper payments in 2004 and cooperated during the subsequent investigation. There is reportedly no indication that the company’s management knew of the alleged bribery, and neither Pfizer nor Wyeth admitted wrongdoing as part of the settlement.
In a statement, the company’s general counsel Amy Schulman highlighted its commitment to compliance. "The actions which led to this resolution were disappointing,” she said. “But the openness and speed with which Pfizer voluntarily disclosed and addressed them reflects our true culture and the real value we place on integrity and meeting commitments.”
Read more on the settlement at Futures Magazine.
For more InsideCounsel coverage of FCPA violations, read: