Pfizer to Pay $400 million to Avert Class Action Trial

Pfizer has agreed to pay $400 million to avert a trial in a class action lawsuit accusing the US pharmaceutical giant of misleading investors in connection with off-label marketing.

The accord, which must be approved by a federal judge in New York City, came days ahead of a jury trial that had been scheduled for Feb. 10.

"This resolution reflects a desire by the company to avoid the distraction of continued litigation and focus on the needs of patients and physicians," a Pfizer spokesperson told the news agency Reuters.

Filed in 2010 by a class of investors who bought Pfizer stock from Jan. 19, 2006 to Jan. 23, 2009, the lawsuit accused the company and several executives of making false statements to shareholders about its off-label marketing of products, including the nonsteroidal anti-inflammatory drug (NSAID) Bextra, withdrawn in 2005, and other medicines.

The suit also contended that Pfizer made misleading statements about various US government investigations of those practices that led to a $2.3 billion settlement with the Justice Department in 2009.

Saying its disclosures to investors "were appropriate and prepared in good faith," the company has continuously denied wrongdoing.

Ahead of the trial, Pfizer had sought to block jurors from hearing from the plaintiffs' damages expert, who said the company's stock had been artificially inflated $1.26 a share over the three-year period due to misstatements or omissions.

The drugmaker last year secured the dismissal of another securities class action in the state of New York after a different judge precluded the investors' damages expert. But in early January, a judge denied the company's motion, allowing the case to move forward to trial.