(NaturalNews) The biggest of the Big Pharmas, Pfizer, has agreed to pay $60 million in fines to the federal government to settle charges the company paid millions of dollars in bribes to foreign officials.
The drug maker agreed to pay roughly $45 million to the Securities and Exchange Commission to settle charges that it, along with fellow Big Pharma firm Wyeth - which Pfizer acquired just a few years ago - violated the Foreign Corrupt Practices Act, a variety of reports noted.
Officials with the SEC said staff from both companies' subsidiaries paid off foreign government officials to increase sales and obtain regulatory approvals. Violations occurred in several countries - China, Bulgaria, Russia, Serbia, Croatia, the Czech Republic, Italy, and Kazakhstan, said SEC officials.
In addition, the company was forced to pay $15 million into a deferred prosecution arrangement by entering into two agreements with the Department of Justice, according to filings in federal court in Washington, D.C., Bloomberg News reported. Prosecutors further agreed to drop all charges after two years if the company continues to cooperate.
"Corrupt pay-offs to foreign officials in order to secure lucrative contracts creates an inherently uneven marketplace and puts honest companies at a disadvantage," said James McJunkin of the FBI's Washington field office, in a statement.
In China, for instance, Pfizer officials rewarded government physicians who prescribed large amounts of the company's medications by inviting them to meetings and conferences with "extensive entertainment activities," according to the SEC.
In Croatia, government doctors were given a portion of the proceeds from Pfizer's sales of drugs to the doctors' own institutions, said the agency.
In Bulgaria, local Pfizer representatives shelled out $28,000 to invite government doctors on so-called "incentive trips" to Greece, as a way to reward those of them who were the biggest prescribers of Pfizer's products. They also paid $17,000 to send doctors to medical conferences, once again, in exchange of prescribing Pfizer medications.
In Bulgaria, local representatives spent $28,000 to invite government doctors on "incentive trips" to Greece, as a reward for the physicians who were the biggest prescribers of Pfizer's products, Pfizer admitted according to the Justice Department filing. They also paid $17,000 to send doctors to medical conferences, again in exchange for commitments to prescribe Pfizer drugs.
The company said in response there are no allegations against anyone at its corporate headquarters was aware of the conduct being scrutinized and punished, and that it voluntarily reported the activity to the government in 2004, then again in 2009 after acquiring Wyeth.
"The actions which led to this resolution were disappointing, 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," said Amy Schulman, executive vice president and general counsel at Pfizer, in a statement.
The SEC did acknowledge that the payouts were made "without the knowledge or approval of officers or employees of Pfizer," but went on to say that "the inaccurate books and records of Pfizer subsidiaries were consolidated in the financial reports of Pfizer."
Prosecutors also said they agreed to the $15 million fine - a 34 percent reduction - because of Pfizer's "extraordinary cooperation" and its "extraordinary and ongoing remediation" of the problem.
The case against Pfizer came as the U.S. government probed other drug makers, including Teva Pharmaceutical Industries, Ltd., AstraZenica Plc, Bristol-Myers Squibb Co., and GlaxoSmithKline Plc., for possibly violating an overseas anti-bribery law barring employees or those acting on their behalf from paying bribes to officials of foreign governments to either obtain or retain business.
"These improper payments were variously made to influence regulatory and formulary approvals, purchase decisions, prescription decisions, and to clear customs," said the SEC.
Pfizer and the other drug makers are not alone in the business of bribery. Retail giant Walmart was in the spotlight earlier this year following a New York Times report that said the company paid out $24 million with bribes in Mexico as a way of streamlining construction projects.