Pfizer 2013 Annual Report Download - page 110

Notes to Consolidated Financial Statements
Pfizer Inc. and Subsidiary Companies
2013 Financial Report 109
Neurontin
• Off-Label Promotion Actions
A number of lawsuits, including purported class actions, have been filed against us in various federal and state courts alleging claims arising
from the promotion and sale of Neurontin. The plaintiffs in the purported class actions seek to represent nationwide and certain statewide
classes consisting of persons, including individuals, health insurers, employee benefit plans and other third-party payers, who purchased or
reimbursed patients for the purchase of Neurontin that allegedly was used for indications other than those included in the product labeling
approved by the FDA. In 2004, many of the suits pending in federal courts, including individual actions as well as purported class actions,
were transferred for consolidated pre-trial proceedings to a Multi-District Litigation (In re Neurontin Marketing, Sales Practices and Product
Liability Litigation MDL-1629) in the U.S. District Court for the District of Massachusetts.
In the Multi-District Litigation, the District Court (i) denied the plaintiffs’ motion for certification of a nationwide class of all individual consumers
and third-party payers who allegedly purchased or reimbursed patients for the purchase of Neurontin for off-label uses from 1994 through
2004, and (ii) dismissed an individual action by a third-party payer, Aetna, as well as actions by certain proposed class representatives for
third-party payers and for individual consumers. In April 2013, the U.S. Court of Appeals for the First Circuit reversed the decisions of the
District Court dismissing the individual action by Aetna as well as the action by the third-party payer proposed class representatives. The First
Circuit remanded those actions to the District Court for further consideration, including reconsideration of class certification in the third-party
payer action. In addition, a number of individual actions by other third-party payers remain pending in the Multi-District Litigation and in other
courts.
In January 2011, the U.S. District Court for the District of Massachusetts entered an order trebling a jury verdict against us in an individual
action by a third-party payer, the Kaiser Foundation Health Plan Inc., seeking damages for the alleged off-label promotion of Neurontin in
violation of the federal Racketeer Influenced and Corrupt Organizations (RICO) Act. The verdict was for approximately $47.4 million, which
was subject to automatic trebling to $142.1 million under the RICO Act. In November 2010, the court had entered a separate verdict against us
in the amount of $65.4 million, together with prejudgment interest, under California’s Unfair Trade Practices law relating to the same alleged
conduct, which amount is included within and is not additional to the $142.1 million trebled amount of the jury verdict. In April 2013, the U.S.
Court of Appeals for the First Circuit affirmed the District Court's decisions.
In December 2013, the U.S. Supreme Court denied our petition for certiorari seeking review of the First Circuit's decisions, described above,
reversing the dismissals of the individual action by Aetna and the third-party payer purported class action and affirming the verdict against us
in the individual action by Kaiser. As a result, the verdict against us in the individual action by Kaiser is final, and the third-party payer
purported class action remains pending in the District Court. In December 2013, we settled the individual action by Aetna for an amount that is
not material to Pfizer.
Plaintiffs are seeking certification of statewide classes of Neurontin purchasers in actions pending in California and Illinois that allege off-label
promotion of Neurontin. State courts in New York, Pennsylvania, Missouri and New Mexico have declined to certify statewide classes of
Neurontin purchasers.
• Personal Injury Actions
A number of individual lawsuits have been filed against us in various federal and state courts alleging suicide, attempted suicide and other
personal injuries as a result of the purported ingestion of Neurontin. Certain of the federal actions have been transferred for consolidated pre-
trial proceedings to the same Multi-District Litigation referred to in the first paragraph of the “Neurontin––Off-Label Promotion Actions” section
above.
• Antitrust Action
In January 2011, in a Multi-District Litigation (In re Neurontin Antitrust Litigation MDL-1479) that consolidates four actions, the U.S. District
Court for the District of New Jersey certified a nationwide class consisting of wholesalers and other entities who purchased Neurontin directly
from Pfizer and Warner-Lambert during the period from December 11, 2002 to August 31, 2008 and who also purchased generic gabapentin
after it became available. The complaints allege that Pfizer and Warner-Lambert engaged in anticompetitive conduct in violation of the
Sherman Act that included, among other things, submitting patents for listing in the Orange Book and prosecuting and enforcing certain
patents relating to Neurontin, as well as engaging in off-label marketing of Neurontin. Plaintiffs seek compensatory damages on behalf of the
class, which may be subject to trebling.
Lipitor
• Whistleblower Action
In 2004, a former employee filed a “whistleblower” action against us in the U.S. District Court for the Eastern District of New York. The
complaint remained under seal until September 2007, at which time the U.S. Attorney for the Eastern District of New York declined to intervene
in the case. We were served with the complaint in December 2007. Plaintiff alleges off-label promotion of Lipitor in violation of the Federal Civil
False Claims Act and the false claims acts of certain states, and he seeks treble damages and civil penalties on behalf of the federal
government and the specified states as the result of their purchase, or reimbursement of patients for the purchase, of Lipitor allegedly for such
off-label uses. Plaintiff also seeks compensation as a whistleblower under those federal and state statutes. In addition, plaintiff alleges that he
was wrongfully terminated, in violation of the anti-retaliation provisions of applicable federal and New York law, and he seeks damages and the
reinstatement of his employment. In 2009, the District Court dismissed without prejudice the off-label promotion claims and, in 2010, plaintiff
filed an amended complaint containing off-label promotion allegations that are substantially similar to the allegations in the original complaint.
In November 2012, the District Court dismissed the amended complaint. In December 2012, the plaintiff appealed the District Court's decision
to the U.S. Court of Appeals for the Second Circuit.