NEW YORK, Jan 27 (Reuters) - Pfizer Inc said on Tuesday it agreed to pay $400 million to avert a trial in a class action lawsuit accusing the pharmaceutical giant of misleading investors in connection with off-label marketing.
Pfizer disclosed the agreement-in-principle as it released its fourth-quarter results. The accord, which must be approved by a federal judge in Manhattan, came days ahead of a jury trial set 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,” said Christine Regan Lindenbloom, a Pfizer spokeswoman.
Michael Dowd, a lawyer for the investors at law firm Robbins Geller Rudman & Dowd, did not respond to requests for comment.
Filed in 2010, the lawsuit accused Pfizer and various executives of making false statements to shareholders about its off-label marketing of products, including Bextra and other drugs.
The lawsuit also contended Pfizer made misleading statements about various government investigations of those practices that led to a $2.3 billion settlement with the U.S. Justice Department in 2009.
Lindenbloom, the Pfizer spokeswoman, said the company continues to deny wrongdoing and believes its disclosures to investors “were appropriate and prepared in good faith.”
U.S. District Judge Alvin Hellerstein had named pension fund Stichting Philips Pensioenfonds the lead plaintiff and certified a class of investors who bought Pfizer stock from Jan. 19, 2006 to Jan. 23, 2009.
Ahead of 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.
Pfizer last year secured the dismissal of another securities class action in New York after a different judge precluded the investors’ damages expert. But earlier this month, Hellerstein denied Pfizer’s motion, allowing the case to move forward to trial.
The case is Jones v. Pfizer Inc, U.S. District Court, Southern District of New York, No. 10-03864. (Reporting by Nate Raymond; Editing by Dan Grebler)