A subsidiary of Pfizer Inc. that paid out millions of dollars in bribes for nearly a decade has agreed to a $15 million settlement with the U.S. Justice Department in a Foreign Corrupt Practices Act investigation.
The subsidiary, Pfizer H.C.P., paid more than $2 million in bribes to government officials in Bulgaria, Croatia, Kazakhstan and Russia, according to charges the government announced today. The company, which entered a deferred prosecution agreement with DOJ, admitted making more than $7 million in profit via the misconduct.
“Pfizer took short cuts to boost its business in several Eurasian countries, bribing government officials in Bulgaria, Croatia, Kazakhstan and Russia to the tune of millions of dollars,” Mythili Raman, a principal assistant attorney general in the DOJ Criminal Division, said in a prepared statement.
Raman also said DOJ "recognizes the significant efforts the company made to eliminate such improper practices, not only by implementing compliance reforms, but also by assisting U.S. authorities in our ongoing FCPA investigations of other companies and individuals.”
Cadwalader, Wickersham & Taft partners Bret Campbell and Peter Clark of the firm's business fraud and complex litigation group represented Pfizer. Campbell was not immediately reached for comment this afternoon.
The deferred prosecution agreement papers called the $15 million fine "appropriate given the nature and extent of Pfizer's voluntary, prompt and thorough disclosure of the misconduct at issue." Pfizer cooperated with the department's investigation of other misconduct in the pharmaceutical industry, the court papers said.
DOJ officials said Pfizer H.C.P. said company employees made illegal payments to hospital administrators, regulatory and purchasing committee officials and other health care professionals. The payments, government lawyers said, were executed to influence the approval and registration of Pfizer products.
Charging documents and the deferred prosecution agreement against Pfizer H.C.P. were filed in U.S. District Court for the District of Columbia. Nathaniel Edmonds, an assistant chief in the DOJ Fraud Section who oversees FCPA enforcement, investigated the case with trial attorney Andrew Gentin.
Pfizer Inc., in a related matter, agreed to the disgorgement of more than $26.3 million in profits in a deal reached with the U.S. Securities and Exchange Commission. Pfizer did not admit or deny the allegations in settling the charges the SEC filed.
The SEC separately charged Wyeth LLC—Pfizer purchased the company in 2009—with violations of the Foreign Corrupt Practices Act. The SEC said Wyeth will give up more than $18.8 million in profits to resolve allegations involving the conduct of subsidiaries.