Abbott Labs with Depakote also, and a few other drug companies below.
Abbott Labs agrees to pay $1.6 billion to settle Depakote cases
May 07, 2012|By Peter Frost
Abbott will pay $800 million to resolve civil allegations split among federal and state governments, $700 million in criminal penalties and $100 million to states to resolve consumer protection matters, the Abbott Park, Ill., company said Monday.
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An article from Hawaii gives other terms of the settlement.
The company also will pay $100 million nationally. As part of this settlement, Hawaii will receive nearly $1.2 million in settlement funds from the company for consumer education and consumer protection enforcement actions.
Under the settlement, Abbott Laboratories is:
Prohibited from making false or misleading claims about Depakote.
Prohibited from promoting Depakote for off-label uses.
Required to ensure financial incentives on sales do not promote off-label uses of Depakote.
In addition, for a 5-year period Abbott must:
Limit the creation and use of responses to requests by physicians for non-promotional information about off-label uses of Depakote.
Limit dissemination of reprints of clinical studies relating to off-label uses of Depakote.
Limit use of grants and continuing medical education.
Disclose payments to physicians.
Register and disclose clinical trials.
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In a previous article, The Chicago Tribune does some in-depth on off-label marketing practices and the reason drugmakers settle by paying fines.
Whistle-blower suits target Abbott's 'off-label' selling of epilepsy drug Depakote
Company, federal regulators could be close to settlement
November 13, 2011|By Ellen Gabler, Chicago Tribune reporter
...
Although doctors are allowed to prescribe drugs "off-label," as the practice is known, companies cannot market them in that way. Regulators say companies often do so anyway and, as a result, drug companies are facing more scrutiny and sometimes end up paying billions in legal settlements.
Some experts say companies agree to the settlements because if they are found liable, the firms could be barred from receiving payments from Medicare and Medicaid programs, which make up a big portion of their sales.
"No company is willing to take that risk," said Antonia Giuliana, an attorney who has represented large pharmaceutical companies.
"The consequences for a company that doesn't settle is potentially devastating."Even though settlements can be costly, some experts contend that drugmakers have little reason to stop off-label promotion because the penalties usually don't offset profits companies reap from off-label marketing.
"Even with these large fines, it is still good business to promote drugs illegally," said Dr. Adriane Fugh-Berman, director of PharmedOut, a project at Georgetown University Medical Center that works to expose inappropriate pharmaceutical marketing techniques.
One reason illegal marketing persists is because companies as an entity, not top executives, are the targets of most investigations and lawsuits, said Eric Blumberg, a litigation deputy for the FDA's Office of Chief Counsel.
"The government needs to start prosecuting individuals if we want to deter this conduct," he said.
The FDA is constantly investigating off-label marketing cases. The FDA said it has received dozens of whistle-blower cases in the past two years.
The cases are often filed under the False Claims Act, in which a private citizen files a lawsuit alleging suspected fraud being committed against the federal government.
Early this month, GlaxoSmithKline PLC said it would pay the U.S. government $3 billion to settle civil and criminal charges for illegal marketing of diabetes drug Avandia and others. In 2009, Pfizer Inc. paid $2.3 billion for similar allegations about its painkiller Bextra, and Eli Lilly & Co. settled for $1.4 billion the same year for Zyprexa, used to treat schizophrenia.Abbott's settlement is expected to be announced sometime in December. Company spokesman Scott Stoffel would only say that "discussions are ongoing."
"These drugs are being promoted for conditions they have not been shown to be effective, and they might be dangerous," she said.
The complaints also allege that doctors were given kickbacks to talk about off-label uses of Depakote.
According to McCoyd's filing, Abbott salespeople were given about $20,000 to $30,000 each year to "educate" physicians and other heath care providers about off-label use of Depakote.
Abbott paid doctors who promoted the drug between $500 and $2000 per speech, the complaint states. The money allegedly was funneled through intermediaries and associations, including the Alzheimer's Association, although the association told the Tribune it has "no knowledge" of such activities.
Using the organizations to pay doctors was done to "disguise the direct payments to doctors and Abbott's substantial and direct involvement" in the events, the complaint alleges.
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