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Pfizer/Wyeth to pay $784M to settle Protonix cases

Drug maker Pfizer Inc. said Tuesday that its subsidiary Wyeth, with operations in Collegeville,has reached an agreement with the Department of Justice to pay $784.6 million to settle claims involving Medicaid rebates for its heartburn drug Protonix.

Drug maker Pfizer Inc. said Tuesday that its subsidiary Wyeth, with operations in Collegeville,has reached an agreement with the Department of Justice to pay $784.6 million to settle claims involving Medicaid rebates for its heartburn drug Protonix.

The agreement resolves cases pending in the U.S. District Court in Massachusetts, alleging that Wyeth's practices relating to the calculation of Medicaid rebates for Protonix violated the Federal Civil False Claims Act and other laws between 2001 and 2006. Pfizer acquired Wyeth in 2009.

The settlement "does not include an admission of liability by Wyeth," the company said.

As a result of the settlement, Pfizer revised its fourth-quarter financial results to a loss of $172 million, or 3 cents a share. Earlier this month,Pfizer had reported a fourth-quarter profit of $613 million, or 10 cents a share.

Pfizer has manufacturing plant in Carlyle, Pa., and commercial operations, and drug research and development in Collegeville, Montgomery County.

"We are pleased to have reached an agreement in principle to resolve these cases, which involve historic conduct that occurred at least 10 years ago, before Pfizer acquired Wyeth," said Doug Lankler, Pfizer executive vice president and general counsel. "The resolution of these cases reflects a desire by the company to put these cases behind us and to focus on the needs of patients."

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