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Corporate Drugs |
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July 2, 2012 Company: GlaxoSmithKline In not only the largest pharma settlement, but the largest healthcare
fraud settlement in history, GlaxoSmithKline ($GSK) agreed to pay a whopping $3 billion to wrap up its Justice
Department probes. The deal requires GSK to plead guilty to three counts and pay a $1 billion criminal penalty, plus another
$2 billion to wrap up civil claims. One reason the settlement is so large is that it's so comprehensive.
It not only includes the off-label marketing and kickback allegations we've grown accustomed
to reporting, but also pricing and rebate claims other drugmakers have settled separately. Glaxo's deal also covers allegations that it downplayed
the safety risks of its controversial diabetes drug Avandia. While the Justice Department crowed about the settlement--"unprecedented
in size and scope," Deputy Attorney General James M. Cole said--Glaxo referred to the "difficult, long-standing matters" the
settlement resolves. Since he took over the company in May 2008, CEO Andrew Witty has taken pains to distance his own governance from past reigns.
His statement about the settlement was no different. "Whilst these originate in a different era for the company, they cannot
and will not be ignored," Witty said, going on to list changes he's made at GSK to forestall misconduct, including revamping
sales-rep pay incentives and reporting payments to doctors. "I want to express our regret and reiterate that we have learnt
from the mistakes that were made," he said. According to the Justice Department, GSK agreed to plead
guilty to two misbranding charges The third count: failing to report Avandia safety data to the FDA. The company touted Paxil for off-label use in children and adolescents, despite
data that failed to show it was effective for kids, the government says. Meanwhile, Glaxo marketed its antidepressant Wellbutrin
for a litany of off-label uses, including weight loss, substance abuse and sexual dysfunction, Justice
alleges. The civil settlement covers allegations of mismarketing 5 other drugs, including the asthma drug Advair and the seizure drug Lamictal. On Avandia, Glaxo allegedly failed to report safety data
to FDA, the government says, including two studies specifically designed to gauge the diabetes drug's safety. The drugmaker withheld data from the agency from 2001 to 2007, the statement says. After that, studies
raised red flags about Avandia's risks to the heart, and the drug was slapped with two black-box warnings;
its use has since been severely curtailed by FDA. The Avandia false-claims allegations--wrapped up on the civil side--include
exaggerating the drug's benefits, including, ironically, its cardiovascular benefits. In all this morass of misbehavior, there's one bit of solace
for Witty: Glaxo's $1 billion criminal fine doesn't top Pfizer's. That penalty amounted to $1.2 billion. ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ June 25, 2012 Company: Pfizer Pfizer's 2009 settlement with the Justice Department wasn't the first to top $1 billion.
But this very different kind of blockbuster was at the time--and remains, at least for now--the biggest healthcare fraud settlement ever. The $1.3 billion in criminal penalties also set a record. ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ |
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June 25, 2012 Company: Johnson & Johnson You might call Johnson and Johnson's ($JNJ) Risperdal settlement an omnibus deal. It is expected to cover federal probes about off-label Risperdal
marketing, state claims of Medicaid fraud (also related to Risperdal), kickback allegations involving the nursing home pharmacy
provider Omnicare and several other drugs besides Risperdal. It would also settle litigation over marketing practices involving
Invega, another antipsychotic, and Natrecor, a congestive heart failure treatment. The company had already pleaded guilty to
misbranding Natrecor and agreed to pay an $85 million fine. ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ http://www.fiercepharma.com/special-reports/top-10-pharma-settlements/abbott-laboratories-depakote Abbott Laboratories - Depakote June 25, 2012 Company: Abbott Laboratories Dementia patients were a target market for drugmakers in the late '90s and into the new millennium,
if off-label marketing settlements are any indication. Like Eli Lilly ($LLY) and Johnson & Johnson ($JNJ), Abbott ($ABT) promoted a product--the seizure drug Depakote--for off-label use in elderly dementia patients who became agitated or aggressive. A
specialized, specially trained Abbott sales force pushed Depakote in nursing homes to help control these patients, even though it had no credible evidence that the drug was safe
or effective for that use. In fact, the company had to stop a clinical trial in elderly dementia patients because of adverse
events. ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ Eli Lilly - Zyprexa June 25, 2012 http://www.fiercepharma.com/special-reports/top-10-pharma-settlements/eli-lilly-zyprexa Company: Eli Lilly When Eli Lilly ($LLY) announced its $1.415 billion settlement with the Justice Department, it was the largest
amount ever paid by any one defendant. It would keep that record for only 8 months, till Pfizer's Bextra deal went public.
But at the time, Justice officials bragged about the historic nature of the agreement: "the largest criminal fine for an individual
corporation ever imposed in a United States criminal prosecution of any kind," the department's release crowed. ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ Merck - Vioxx June 25, 2012 http://www.fiercepharma.com/special-reports/top-10-pharma-settlements/merck-vioxx Company: Merck Vioxx had been a notorious drug for at least 7 years when Merck ($MRK) agreed to pay $950 million to resolve its set of marketing allegations. The dubious
distinction of this settlement isn't its size, though $950 million isn't petty cash. Nor is it the claim that Merck hawked
Vioxx for an unapproved use--rheumatoid arthritis, in this case. Nor are the allegations that the drugmaker exaggerated the
drug's safety and downplayed its risks. Many of the other settlements on this list share those hallmarks. The Vioxx settlement included a $321.6 million criminal
fine--for a misdemeanor misbranding violation--and a $628.4 million payment to wrap up civil claims, including those filed
by 40 states attorneys general. While that $950 million total looms large enough in the settlement universe, it's less than one-sixth the amount Merck
has paid to settle liability lawsuits and other litigation. And it's even smaller fraction of Merck's Vioxx sales. Those revenues
amounted to more than $11 billion during the drug's four-plus years on the market. ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ |
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Serono - Serostim June 25, 2012 http://www.fiercepharma.com/special-reports/top-10-pharma-settlements/serono-serostim Company: Serono (now Merck Serono, owned by Merck KGaA) At the time that Serono pleaded guilty to two felony charges in 2005 for marketing
misbehaving with the growth hormone used to treat wasting in HIV patients, it was the largest settlement of its kind. It has
clearly been eclipsed since then. The settlement, which says the company played loose with the rules from 1996 through 2004,
came ahead of a $13.2 billion acquisition of the Swiss company in 2006 by Merck KGaA ($MRK). Purdue Pharma - OxyContin June 25, 2012 http://www.fiercepharma.com/special-reports/top-10-pharma-settlements/purdue-pharma-oxycontin Company: Purdue Pharma Purdue pleaded guilty to one felony count of fraudulently misbranding Oxycontin for suggesting it was less addictive and less abused than other painkillers, an obvious
disconnect with the reality. It also had sales representatives saying users could stop using the drug, often referred to as
hillbilly heroin, without withdrawal, also a big lie. The New York Times reported at the time that sales representatives
were allowed to draw "fake scientific charts," on the drug's safety, which they passed out to physicians as proof of their
claims. ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ Allergan - Botox June 25, 2012 http://www.fiercepharma.com/special-reports/top-10-pharma-settlements/allergan-botox Company: Allergan Like its bigger rivals that found themselves in off-label trouble, Allergan ($AGN) pled guilty to a misdemeanor violation of the Food, Drug and Cosmetic Act, and paid
fines and penalties for pushing a big product for unapproved indications. The wrinkle that sets this case apart? According to the Justice Department, Allergan smoothed the way for physicians to buy into those off-label uses. Allergan paid doctors $1,500 to sit through presentations about the wrinkle drug's
versatility, the government said, and instructed sales reps to help doctors with the paperwork required to get Botox covered
for unapproved use. Allergan made off-label sales of Botox "a top corporate priority," the DOJ said. Allergan submitted to a $375 million criminal penalty, and it agreed to pay $225 million to wrap up civil claims, including three whistleblower
lawsuits. Its Corporate Integrity Agreement--like Eli Lilly's ($LLY) and Pfizer's ($PFE), among others--requires the company to report its payments to doctors, including
speaking fees and travel, in a publicly available database on its website. ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ AstraZeneca - Seroquel June 25, 2012 http://www.fiercepharma.com/special-reports/top-10-pharma-settlements/astrazeneca-seroquel Company: AstraZeneca To get untangled from legal complications, it signed a 5-year Corporate Integrity Agreement that, among other things, required it post any financial relationships it has with
doctors. The result has been that AstraZeneca has the best disclosure system in the industry with a searchable database that
gives all the dope on cash payments, royalties and even payments made through third-party organizations. ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ Bristol-Myers Squibb - Abilify June 25, 2012 Company: Bristol-Myers Squibb And finally... There is Bristol-Myers ($BMY) and its bad behavior. Its 2007 settlement covered a number of violations, such as gaming
the system to jack up prices on Serzone. But the main focus was Abilify, an atypical antipsychotic in the same class as Eli Lilly's ($LLY) Zyprexa, Johnson & Johnson's ($JNJ) Risperdal and AstraZeneca's ($AZN) Seroquel. ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ |
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