Pfizer has got a problem on its hands. Businessweek has had a chat with Peter Rost, the VP fired  for accusing Pfizer (and Pharmacia which it bought) of illegally off-label marketing of human growth hormone, the Pharmacia drug Genotropin, and of course for his views on reimportation (He thinks big Pharma should allow it – Big pharma opposes it).

Now in the big scheme of off-label marketing, this one is small potatoes. Big Pharma routinely violates both rules about marketing and promotion, and ends up having to pay fines or settlements on a frequent basis. Whistleblower suits abound. It’s part of the cost of doing business.

I too, have had an email "chat" with Peter Rost. He was in charge of marketing the product in question (although not in charge of sales) I asked him a few pointed questions, like did he inherit the "problem" or did it start when he was there?  And why did he keep going with the suit if Pfizer had already told the government about the problem?

Rost’s answers, which you can extract from the email trail on his lawyers web-site, are that this stuff was going on already when he got there, he pointed it out up the chain, but no one really dealt with it. He was concerned that he was potentially getting himself into trouble if Pharmacia didn’t come clean.

Meanwhile while Pfizer took over Pharmacia, Rost’s retention got messed up by the discovery that he was involved in suing his previous employer Wyeth, after which Pfizer suddenly decided that they didn’t want him. Meanwhile Rost wrote a memo blowing up the chain. Up until that point, according to Rost, Pfizer was doing the right thing but changed its tune and started pulling nasty corporate shenanigans. That included hiring a private detective to check Rost out, etc, etc.

Finally, according to Rost, Pfizer hand delivered a letter to the government (Rost called it an incomplete letter) the day before Rost formally filed his. If Rost is to be believed, he didn’t know that Pfizer was about to submit the letter and he had prepared his submission over time. In that case their timing appears just a little coincidental.

Now the government has declined to take part in the suit, meaning that they don’t think Rost’s case is that strong. Once that decision was made and the suit was uncovered, Rost was fired. Pfizer had kept him around doing nothing for a long time anyway, and hadn’t fired him because (I assume) they knew he was being a whistleblower, and there are strong laws about retaliation.

It seems to me that by piling on Rost, Pfizer has caused itself more trouble than if it had just come clean, blamed the whole thing on Fred Hassan & Pharmacia, and paid whatever it needed to to cut a deal with the  government as soon as it knew. After all it’s just part of the cost of doing business for big pharma. The whole thing is a lesson for risk management; one that you’d expect Pfizer already to have known.

Now they face a court case which at the least will leave them with some unwelcome publicity. Still better than the Feds forcing them to settle the Qui Tam….