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In-PharmaTechnologist special feature

The perils of whistleblowing

By Kirsty Barnes , 06-Jan-2006

The firing of Dr Peter Rost by Pfizer highlights the position that employees can be faced with if they take a stand on what they believe to be illegal activity in the companies they work for.

The choices in such a situation are limited – quit and find a new job; turn a blind eye and in doing so risk becoming party to the activity; or act, and risk jeopardizing a career.

The outspoken exec, who has long been a thorn in >Pfizer's side as an advocate of drug re-importation – to which the pharma giant is greatly opposed – was fired on 1 December 2005 after a False Claims Act civil case, launched by Dr Rost against Pfizer/Pharmacia on 3 June 2003, was unsealed.

Dr Rost accused Pfizer/Pharmacia of defrauding the Medicare Program by off-label promotion of Genotropin, a prescription growth hormone.

His complaint alleges that Genotropin was promoted for its anti-aging effects in adults and for unapproved genetic disorders in children, and that this off-label marketing produced $50 million in illegal Genotropin sales, 25 per cent of the total.

An email, made available on the Green & Savits’ website, sent from Dr Rost to Marie-Caroline Sainpy, senior vice president, Pfizer on 21 January 2003 stated:

“Pharmacia has been actively promoting Genotropin for more than 5 years, mainly for anti-ageing purposes. For growth hormone, this is a felony. Pharmacia sales reps who did not agree to off-label promotion were fired, or other adverse action was taken against them. We also have compliance records from sales reps indicating in writing that they had been forced to do off-label promotion. Pharmacia also actively encouraged off-label promotions by through favourable contracts with distributors and doctors exclusively working in the anti-ageing area. Pharmacia also paid kickbacks, sometimes in the form of “consulting agreements” of up to $50,000.”

In the US it can be a federal crime for any growth hormone to be promoted off-label because of the significant abuse potential associated with growth hormones and the harm they can have if taken incorrectly.

Dr Rost told In-PharmaTechnologist.com that filing against his own employer was a matter on which he had “no choice”. “I tried for months through meetings and written correspondence to get the company to act but when they did not I had to take matters into my own hands.”

“Off-label promotion of growth hormone can carry up to a 5-year jail term. I risked going to jail if I knew about this and did not act,” alleged Dr Rost.

This civil claim was kept sealed until November 2005, however, once it was opened, the US attorney’s office in Boston decided not to intervene. Not being put off by this, Dr Rost now intends to pursue the claim against Pfizer/Pharmacia, funding the legal challenge himself.

According to Dr Rost, the Justice Department does not intervene in 70-80 per cent of these types of cases due to lack of resources. “If they thought it was without merit they could dismiss it, which they haven’t,” he alleged.

If Dr Rost were to win his civil case, Pfizer would be fined a large sum and the government would retain 75-80 per cent as compensation. The remainder would be paid to Dr Rost as a bonus.

Pfizer has since filed a motion to dismiss Dr Rost’s civil case. It argues that it was Pfizer's lawyers, not Rost, who were the true whistleblowers - informing federal officials of Genotropin irregularities in letters via email, before Rost filed the proper legal paperwork.

However, a letter, made available on the Green & Savitt’s website, sent by Jeffrey Kindler, Pfizer's vice-chairman and general counsel, dated May 28, 2003, and received by Dr Rost on June 9, 2003, acknowledged and validated Rost's disclosure of the company’s illegal marketing conduct, stating:

"I recognize that, with your assistance, Pharmacia examined these issues in 2002 and made significant changes to correct the issues you raised. Nevertheless we are making additional changes to the endocrine care business based on our review, which we are also in the process of disclosing to the relevant government authorities."

The issue that will now be argued in court is whether the general letters sent to the government by Pfizer constitutes sufficient notification to the government or not, Jon Green, Green & Savits' law firm told In-PharmaTechnologist.com.

Rost said that in addition to the civil case that he will be pursuing, a criminal investigation of Genotropin has been underway, led by Susan Winkler, assistant US Attorney, Boston.

“I have testified twice before a grand jury in Boston, and several of my colleagues have also testified,”he said.

If the Justice Department decides from this testimony that there is sufficient evidence to pursue the matter further, they will call an indictment against the employees involved, with the risk of large fines and possible jail time. The current status of this criminal case could not, however, be confirmed by In-PharmaTechnologist.com at the time of publishing.

Pfizer recently settled a similar criminal lawsuit, initiated by whistleblower Dr David Franklin, after the company pleaded guilty to criminal fraud in the promotion of Neurontin, and agreed to pay $430 million last year.

In 2003, Dr Rost also settled a whistle-blower lawsuit against Wyeth for an undisclosed amount. He made allegations about wages and unpaid taxes in Wyeth's operations he oversaw in Sweden, Denmark and Norway from 1999 to 2001 before landing at Pharmacia. He would comment no further on the matter.

Dr Rost has also now launched an unfair dismissal case against Pfizer, following the company’s decision to fire him last month.

“Whether or not Pfizer have the False Claims Act civil case dismissed has no bearing on the recent unfair dismissal case launched by Rost against Pfizer,” said Green.

“The unfair dismissal case is based around the fact that after he began raising these issues of illegal activity to Pfizer in Oct 2003, he was told a few months later that there would be no position for him in the company,” said Green.

In New Jersey, there’s a statute called the Conscientious employee protection act (CEPA) where if an employee raises concerns pertaining to what they believe are illegal activities conducted by the company, even if these turn out to be unfounded, employees cannot punish them or retaliate in any way, Green explained.

According to the unfair dismissal complaint, when Pfizer acquired Pharmacia in 2002, Rost was then a vice president at Pharmacia who was initially informed by Pfizer that "there is no question whatsoever on our side with your being considered for several positions."

Prior to the takeover in 2002, Dr Rost’s supervisor Magriet Gabriel-Regis, group vice president, Pharmacia, met with Marie-Caroline Sainpy, senior vice president, Pfizer and recommended his continued employment.

According to his end of year review in 2002 written by Gabriel-Regis, “Peter brought a tremendous difference to the department. He has effected a major reorganization, reanalyzed many aspects of the business and essentially rebuilt plans from the ground up. His significant role and the energy he has devoted will pay off even more in the future. Peter is a key leader with potential for an even larger senior marketing role or a high-level role within operations.”

However, in January 2003 The New York Times published a front-page article describing how Rost had launched a whistleblower lawsuit against his former employee Wyeth. Shortly after, Pfizer informed Dr Rost that it would not be offering him a position within the company, according to the legal complaint on the Green & Savits' website.

Paul Fitzhenry, a Pfizer spokesman claimed that the latest unfair dismissal lawsuit was “baseless” and that Pfizer would “vigorously defend the case.”

Pfizer said it had kept Dr Rost on the payroll until this month to avoid any associated complications while the False Claims Act was being investigated against Pfizer.

Had there been no lawsuit, Rost would have been given severance pay and released in 2003, when his vice president's position at Pharmacia was eliminated as part of the merger between the two companies, claimed Fitzhenry.

Commenting on the situation, Dr Rost said “I don’t enjoy having to sue people – for 20 years prior to all this mess I have had no contact with lawyers.”

“I am now looking for another job so that I can support myself and my family, however, the big pharma companies are reluctant to interview me for any positions,” he said.

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