Pfizer (PFE) faces $8.5 billion lawsuit in Nigeria

In an example of just how dicey it can be to do business in the developing world, Pfizer (NYSE: PFE) finds itself in a lawsuit brought by the government in Nigeria for $8.5 billion. The suit claims that the company "deceived patients and caused the death of 11 children in 1996 when it performed clinical trials for a new drug," according to Reuters. In 1996, the country was in the midst of a meningitis outbreak killed more than 12,000 children in six months.

Pfizer says it offered experimental drug Trovan because the government was pleading for help. Nigeria claims that Pfizer "failed to obtain all the required approvals for the test and did not get proper consent from the patients." And, later the FDA found that the drug could cause liver problems in some patients.

The suit brings up a difficult moral dilemma. Assuming that Pfizer felt that the drug was safe, offering it in an emergency would appear to be almost noble. But, if the trouble in Nigeria was used to get further test data on the drug, the company is due for more PR trouble than it has faced in a long time.

It would appear that, since Pfizer was likely to be able to have clinical trials outside Nigeria, that testing the drug there was of little use.

The incident may effect how much help US companies will want to give when poorer nations ask for it.

Douglas A. McIntyre is a partner at 24/7 Wall St.