Pfizer 2005 Annual Report Download - page 68

2005 Financial Report 67
Notes to Consolidated Financial Statements
Pfizer Inc and Subsidiary Companies
will provide Pharmacia with a release of all retiree benefit claims.
Solutia will continue to be liable for retiree benefits, as modified.
The plan does not in any way affect the obligations undertaken
by New Monsanto to indemnify Pharmacia for all liabilities that
Solutia originally assumed in connection with the 1997 spin-off.
Importation Cases
In 2004, a number of purported class actions were filed in the U.S.
District Court for the District of Minnesota alleging that Pfizer and
several other pharmaceutical manufacturers violated federal and
state civil antitrust laws by conspiring to prevent the importation
of brand-name prescription drugs from Canada. These suits were
consolidated into a single action in the District of Minnesota (In
re Canadian Import Antitrust Litigation), which seeks to represent
a nationwide class consisting of all persons who purchased or
reimbursed patients for the purchase of prescription drugs
manufactured and marketed by defendants that also are available
in Canada. Plaintiffs claim that, as a result of the alleged
conspiracy, U.S. prices for defendants’ prescription drugs are
higher than they otherwise would be. Plaintiffs seek monetary
relief, including treble damages and a refund of the allegedly
unlawful profits received by defendants, and injunctive relief. In
August 2005, the court granted the defendants’ motion to dismiss
this action, and the plaintiffs have appealed the decision.
Also in 2004, a number of independent pharmacists in California
filed an action in California Superior Court, Alameda County,
against Pfizer and several other pharmaceutical manufacturers. The
complaint, as amended, asserts that the defendants conspired to
fix the prices of their prescription drugs in California, using the prices
at which such drugs are sold in Canada as the minimum prices, in
violation of California antitrust and unfair business practices laws.
Environmental Matters
We will be required to submit a corrective measures study report
to the U.S. Environmental Protection Agency with regard to
Pharmacia’s discontinued industrial chemical facility in North
Haven, Connecticut.
We are a party to a number of other proceedings brought under
the Comprehensive Environmental Response Compensation and
Liability Act of 1980, as amended, (CERCLA or Superfund) and
other state, local or foreign laws in which the primary relief
sought is the cost of past and/or future remediation.
F. Government Investigations and Requests for
Information
Like other pharmaceutical companies, we are subject to extensive
regulation by national, state and local government agencies in the
U.S. and in the other countries in which we operate. As a result,
we have interactions with government agencies on an ongoing
basis. The principal pending investigations and requests for
information by government agencies are as follows:
We received requests for information and documents from the
Department of Justice in 2003 concerning the marketing of
Genotropin as well as certain managed care payments, and in 2005
concerning certain physician payments budgeted to our
prescription pharmaceutical products.
In 2003 and 2004, we received requests for information and
documents concerning the marketing and safety of Bextra and
Celebrex from the Department of Justice and a group of state
attorneys general. In 2005, we received a similar request from the
staff of the Securities and Exchange Commission.
In 2005, the Department of Justice informed us that it is
investigating Pharmacia’s former contractual relationship with a
health care intermediary.
The Company has voluntarily provided the Department of Justice
and the Securities and Exchange Commission information
concerning certain potentially improper payments made in
connection with foreign sales activities in certain countries. In Italy,
Pfizer Italia S.r.l., an indirect, wholly owned subsidiary of Pfizer
Inc., has been notified that it is under criminal investigation by
the Public Attorney’s office in Bari, Italy, with respect to gifts and
payments allegedly provided to certain doctors operating within
Italy’s national healthcare system. Pfizer Italia intends to continue
to fully cooperate with the Public Attorney’s office.
We received a letter from the Office of the Attorney General of
the State of New York in 2004 requesting documents and
information concerning clinical trials of certain of our
pharmaceutical products for indications other than those approved
by the FDA and concerning possible promotion of those products
for such indications. We also received a letter from the Office of
the Attorney General of the State of Connecticut in 2004
requesting similar materials concerning Zoloft.
G. Guarantees and Indemnifications
In the ordinary course of business and in connection with the sale
of assets and businesses, we often indemnify our counterparties
against certain liabilities that may arise in connection with the
transaction or related to activities prior to the transaction. These
indemnifications typically pertain to environmental, tax, employee
and/or product-related matters. If the indemnified party were to
make a successful claim pursuant to the terms of the
indemnification, we would be required to reimburse the loss.
These indemnifications are generally subject to threshold amounts,
specified claim periods and other restrictions and limitations.
Historically, we have not paid significant amounts under these
provisions and at December 31, 2005, recorded amounts for the
estimated fair value of these indemnifications are not material.
19. Segment, Geographic and
Revenue Information
Business Segments
We operate in the following business segments:
•Human Health
—The Human Health segment, which represents our
pharmaceutical business, includes treatments for
cardiovascular and metabolic diseases, central nervous
system disorders, arthritis and pain, infectious and
respiratory diseases, urogenital conditions, cancer, eye
disease, endocrine disorders and allergies.
•Consumer Healthcare
—The Consumer Healthcare segment includes self-medications
for oral care, upper-respiratory health, tobacco dependence,
gastrointestinal health, skin care, eye care and hair growth.
•Animal Health
—The Animal Health segment includes prevention and
treatments for diseases in livestock and companion animals.
We operate several other businesses, including the manufacture
of empty soft-gelatin capsules, contract manufacturing and bulk
pharmaceutical chemicals. Due to the size of these businesses, they
are grouped into the “Corporate/Other” category.