The largest health care fraud settlement ever was announced by the U.S. Justice Department today. The settlement, totaling $2.3 billion, is with pharmaceutical company Pfizer and its subsidiary, Pharmacia & Upjohn.  According to the agreement, Pharmacia & Upjohn will plead guilty to charges of fraudulently marketing Bextra, an anti-inflammatory drug, which constitutes a felony violation of the Food, Drug and Cosmetic Act.  Pharmacia & Upjohn will pay a $105 million fine for the infraction, and Pfizer will pay $1.195 billion, the largest criminal fine in U.S. history.  The total criminal liability is $1.3 billion. 

Pfizer will also pay an additional $1 billion to settle allegations that it violated the federal False Claims Act by illegally promoting four drugs (Bextra, Geodon, Zyvox and Lyrica) and causing the submission of false claims to government healthcare programs.  The government also alleged that Pfizer had paid kickbacks to doctors in exchange for prescribing these medications.  The $1 billion represents the largest civil fraud settlement ever against a pharmaceutical company.  The settlement agreement also calls for Pfizer to establish business procedures aimed at preventing recurrence of the conduct alleged.

As part of the resolution, six whistleblowers will receive a total of $102 million from the federal share of the civil recovery.