Pfizer fined record $1.3bn for illegal marketing

Pfizer has been slapped with the largest criminal fine in US history, part of a $2.3bn (£1.4bn) settlement over illegal marketing practices for a string of prescription drugs.

The pharmaceuticals giant is pleading guilty to promoting its withdrawn arthritis painkiller Bextra to doctors for unapproved uses and is paying to settle other claims over its marketing of nine other drugs. The criminal fine of $1.3bn is the highest ever levied and the overall size of the settlement is the biggest ever in the drug industry. It signals that the Department of Justice plans to come down hard on firms as it seeks to claw back money to reduce the cost of the US state-run health insurance schemes Medicare and Medicaid.

Bextra, which was withdrawn in 2005 after being linked to an increased risk of heart attacks and strokes, was among several drugs Pfizer promoted to doctors for unapproved uses. It also settled claims that it had made inappropriate payments to doctors. As part of the settlement it will submit to a five-year compliance regime overseen by the US government. "We regret certain actions taken in the past, but are proud of the action we've taken to strengthen our internal controls," said Amy Schulman, Pfizer's general counsel.

Regulators such as the Food and Drug Administration in the US carefully set out what claims can be made for every drug and control the exact wording of the drug's label. Companies promoting products for unapproved uses face large fines. However, doctors can prescribe drugs whenever they think they may be effective, even if the precise use has not been officially sanctioned. This "off-label" use can be a big contributor to drug-company revenue, particularly from recently launched products.

Companies try to encourage off-label use by pursuing and publicising scientific studies that suggest potential new uses for drugs, but their actions have increasingly been attracting the attentions of law enforcers.