Pfizer Inc. has failed to persuade a federal judge to dismiss a shareholder lawsuit accusing the company of fraudulently misrepresenting the safety of its Celebrex and Bextra pain-relieving drugs. While dismissing some of the claims, U.S. District Judge Laura Taylor Swain in Manhattan said a reasonable jury could find that Pfizer and several top executives intended to mislead shareholders about the drugs’ cardiovascular risks. Judge Swain wrote in her order:
The record is replete with evidence that defendants recognized that Celebrex and Bextra had associated cardiovascular risks, that such risks would be considered material by investors, and that defendants nonetheless misrepresented and actively concealed these risks.
The Plaintiffs are led by the Teachers’ Retirement System of Louisiana and a class was certified July 5, 2012. Judge Swain scheduled a final pre-trial conference for July 12. She also directed both sides to meet with a federal magistrate judge or an outside mediator to work on a settlement before then.
As we reported on numerous occasions, concerns about the safety of Celebrex and Bextra began to mount following the release of medical studies in late 2004, when rival Merck & Co. withdrew its own Vioxx drug from the market because of associated cardiovascular risks. Celebrex sales totaled $3.3 billion and Bextra sales totaled $1.29 billion in 2004. But Pfizer finally pulled Bextra from the U.S. market in April 2005 at the recommendation of the U.S. Food and Drug Administration (FDA). Sales of Celebrex fell by nearly half that year. Then in 2009, Pfizer agreed to pay $2.3 billion to settle a U.S. Department of Justice investigation into the marketing of Bextra and other drugs.
The New York-based company still sells Celebrex, which is intended to treat arthritis pain and inflammation, as well as acute pain, and whose sales totaled $2.72 billion last year. Pfizer won a patent extension in March giving it marketing exclusivity over the drug, whose chemical name is celecoxib, until December 2015. The lawsuit covers investors who bought Pfizer stock between October 31, 2000, and October 19, 2005, a period in which the company’s share price fell by roughly half and its market value fell by well over $100 billion.
Several big investors, including the California pension funds CalPERS and Calstrs, “opted out” of the class last year, enabling them to sue on their own. Pfizer bought Pharmacia Corp, which originally developed Celebrex and Bextra, in April 2003. The Plaintiffs are represented by Jay W. Eisenhofer, Richard S. Schiffrin, James J. Sabella, Mary S. Thomas, Charles T. Caliendo, Brenda F. Szydlo and Ned C. Weinberger at Grant & Eisenhofer P.A.; Andrew L. Zivitz, Benjamin J. Sweet, Karen E. Reilly and Michaelle M. Newcomer at Kessler Topaz Meltzer & Check LLP; and Chris Seeger and David Buchanan at Seeger Weiss LLP. The case is In re: Pfizer Inc Securities Litigation, which is in the U.S. District Court, Southern District of New York, No. 05-md-01688.
Contact us today for a free legal consultation with an experienced attorney.
Fields marked *may be required for submission.
If you would like to subscribe to the Jere Beasley Report digital edition, simply visit our Subscriptions page and provide the necessary information or call us at 800-898-2034.
Attorney Advertising - Prior results do not guarantee a similar outcome.