The settlement would result in a third-quarter charge of $229 million, the company said. Quigley, the subsidiary Pfizer bought in 1968, filed for bankruptcy protection in U.S. Court in New York on Friday. Quigley at one time made materials used to coat steelmaking equipment.
Pfizer agreed to contribute $405 million over 40 years to a trust that will pay remaining and future claims against Quigley, whose only business since 1992 has been the management of the lawsuits. Pfizer and Quigley are named in 171,611 pending lawsuits that claimed personal injury caused by exposure to asbestos, silica or mixed dust, Pfizer said.
The settlement, which is subject to court approval, also requires Pfizer to forgive a $30 million loan to Quigley.
Paul Fitzhenry, a Pfizer spokesman, said the charge and Pfizer’s insurance coverage should cover all asbestos-related liabilities.
“I’m glad they settled,” said John Farrall of National City Private Client Group. “Pfizer is not normally thought of as an asbestos-related concern, so it hasn’t been that major of an issue or a risk, but it’s good to see it done.”
Quigley sold insulation materials and products containing asbestos until the early 1970s. Pfizer later sold off the activities unrelated to its main business of developing and selling prescription medicines.
Asbestos, used as an insulation and fireproofing material until the 1980s, has been linked to cancer and respiratory illnesses. Asbestos-related personal-injury claims have forced more than 60 companies into bankruptcy since 1982, including W.R. Grace and Federal-Mogul.
Pfizer still faces about 139,100 claims against American Optical, a business Warner-Lambert bought in 1967 and sold in 1982. Pfizer inherited the liabilities when it acquired Warner-Lambert in June 2000. The unit made respiratory devices and safety clothing to shield against asbestos exposure.