Pfizer subsidiary, Wyeth, agrees in principle to resolve claims

Pfizer announced this week that an agreement has been reached by its subsidiary, Wyeth, to resolve claims that its practice in calculating Medicaid rebates violated the Federal Civil False Claims Act and other laws.

The suits revolve around Wyeth’s rebates involving the drug Protonix from 2001 to 2006, which happened before Pfizer bought the company in 2009. The agreement has yet to be finalized, but when it is it will settle in full pending cases in the Federal District Court for the District of Massachusetts.

The terms of the agreement state that Wyeth must pay out $784.6 million so the claims filed against it can be resolved. An admission of liability for these claims by Wyeth does not exist in the agreement. The final settlements of the agreement are up for negotiation and must be approved by the court.

Pfizer has responded to the agreement against Wyeth by reissuing 2015 financial reports for its fourth quarter and full-year earnings to reflect the $784.6 million. The document was originally released on Feb. 2 of this year. These reports will be in compliance with the U.S. generally accepted accounting principles (GAAP). Pfizer’s non-GAAP financials reports were not affected by the charges against Wyeth.