Pharmacia and Upjohn Company Inc., a unit of Pfizer Inc. (PFE.N), pleaded guilty to one count of offering a kickback to a pharmacy benefit manager and was sentenced to pay a criminal fine of $19.68 million, federal prosecutors said on Wednesday.
As a result of its conviction, Pharmacia will be excluded permanently from participation in all federal health care programs, prosecutors said.
Pharmacy benefit managers often recommend drugs to health plans. Their list of recommended drugs is called a formulary.
Prosecutors alleged Pharmacia offered the pharmacy benefit manager inflated payments in the amount of $12.3 million.
They also charged that Pharmacia's financial analyses showed the company expected to earn that much or more from the improved formulary positioning and benefits their drugs were expected to receive in return.
Earlier this month, prosecutors said Pharmacia would plead guilty to the charge, pay the fine and be permanently banned from federal health care programs.
