Pfizer whistleblower's ordeal reaps big rewards

NEW YORK Thu Sep 3, 2009 12:59pm EDT

A view of the Belgian headquarters of U.S. pharmaceutical giant Pfizer, in Brussels in this January 23, 2007 file photo. REUTERS/Francois Lenoir

A view of the Belgian headquarters of U.S. pharmaceutical giant Pfizer, in Brussels in this January 23, 2007 file photo.

Credit: Reuters/Francois Lenoir

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NEW YORK (Reuters) - Taking on corporate giants can feel like tilting at windmills, but John Kopchinski's six-year legal battle against Pfizer Inc (PFE.N) just made him a rich man.

The Gulf War veteran and former Pfizer sales representative will earn more than $51.5 million as a result of his whistleblower lawsuit against the world's biggest drugmaker and the record penalty the company must pay the U.S. government for its massive marketing transgressions.

The unassuming Texas resident celebrated his windfall by having a family portrait photograph taken Wednesday morning.

"We're going to be staying right here in San Antonio in the same house, and my wife tells me when we go to the movies we're still getting one tub of popcorn -- the large tub," Kopchinski said in a telephone interview.

Kopchinski, appalled by Pfizer's tactics in selling the pain drug Bextra, filed a "qui tam" lawsuit in 2003, sparking federal and state probes that led to Wednesday's agreement by the company to pay $2.3 billion in civil and criminal penalties and plead guilty to a felony charge for promoting Bextra and 12 other drugs for unapproved uses and doses.

"In the Army I was expected to protect people at all costs," Kopchinski said in a statement. "At Pfizer I was expected to increase profits at all costs, even when sales meant endangering lives.

"I couldn't do that," added Kopchinski, 45, who was fired by Pfizer in March of 2003, two years before the company pulled Bextra from the market over concerns it raised the risk of heart attacks and strokes.

At the time of his dismissal after raising his concerns with the company, Kopchinski had a baby son and his wife was pregnant with twins. He went from earning about $125,000 a year to living off his retirement fund before landing a job with an insurance company for $40,000 a year.

"It was a lot of stress on the family. I pretty much depleted my entire 401(k)," he said.

"The last six years have been pretty hard, so going forward it's going to be pretty much easier," said Kopchinski, noting that college for his young children "is taken care of."

Erika Kelton, Kopchinski's lead attorney from the firm of Phillips & Cohen LLP, said large rewards are justified because of what whistleblowers must endure, often for many years, after complaints within the company go unheeded.

"Particularly in pharma, it's no secret that it's an industry that can blackball former employees," Kelton said, "so the reward is important both to encourage people to step forward and to recognize that their contributions are huge."

Kopchinski and five other whistleblowers will earn more than $102 million in payments from the U.S. government under the False Claims Act through which individuals can reap rewards for exposing corporate wrongdoing.

"The use of whistleblowers has really opened up the keys to the kingdom in terms of what's going on in these companies," said Dean Zerbe, senior counsel for the National Whistleblower Center and a partner at the law firm of Zerbe, Fingeret, Frank and Jadav in Washington.

"You'd never find out what's happening without this kind of reward structure," Zerbe said.

Kopchinski was hired by former Pfizer CEO Edward Pratt in 1992 after carrying out a correspondence with him while serving as a platoon leader in a military police company on the Saudi Arabia-Kuwait border during the Gulf War.

Under a later Pfizer regime, he was selling the epilepsy drug Neurontin when a previous whistleblower suit was filed against the company over similar illegal promotion tactics that led to stiff penalties and a form of corporate probation.

At the time he was told by managers that the Neurontin suit would be in the news and any physicians who asked questions should be told it was just complaints from a disgruntled former employee, Kopchinski said. Ironically, after filing the Bextra suit, "I was the disgruntled former employee," he said.

"What you see here is a company which essentially had a culture of corruption," said Patrick Burns, a spokesman for Taxpayers Against Fraud, a U.S. nonprofit organization that helps connect whistleblowers with attorneys on False Claims Act cases. He called the $2.3 billion settlement "a jaw-dropping amount of money."

The size of the whistleblower rewards announced Wednesday are already having an impact.

"I'm seeing it first-hand myself. I've gotten phone calls this morning," said Zerbe, who was approached by an employee of a hospital who claimed that it was overbilling the government, including charging for products it had received for free.

Despite the potential for huge rewards, however, life can be hellish for whistleblowers.

"If this was so easy everyone would be a millionaire," Burns said.

(Reporting by Bill Berkrot; Editing by Gary Hill.)

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