J&J Pays $81M Over Off Label Marketing Charges
10 CommentsBy Ed Silverman // April 29th, 2010 // 1:12 pm
The health care giant’s Ortho-McNeil Pharmaceutical and Ortho-McNeil-Janssen Pharmaceuticals subsidiaries are ponying up $81 million in order to resolve criminal and civil lawsuits charging the units with illegally promoting the Topamax epilepsy drug.
This is one of three such agreements the Justice Department announced this week. Also today, Schwarz Pharma will pay $22 million for failing to tell the Centers for Medicare and Medicaid Services that two unapproved drugs didn’t qualify for coverage under federal health care programs. And earlier this week, AstraZeneca agreed to pay $520 million for off-label promotion of the Seroquel antipsychotic (see here).
Unlike the J&J charges, these two oher cases didn’t involve criminal charges. One thing all three settlements have in common, however, is that no individual executives were named. This has become an issue. Earlier this month, Lewis Morris, the Health and Human Services Inspector General, said that drugmakers that repeatedly defraud the government may be forced to sell meds, relinquish product exclusivity, or fire execs and have them banned from working at other companies that do business with the government (see here).
Ortho-McNeil agreed to plead guilty to a misdemeanor and pay a $6.14 million criminal fine, and Prtho-McNeil-Janssen Pharmaceuticals will pay $75.37 million to resolve civil allegations under the False Claims Act. The federal share of the civil settlement is $50.6 million and the state Medicaid share of the civil settlement is $24.7 million. Two whistleblowers will receive payments totaling more than $9 million from the federal share of the civil recovery (see Justice Department statement and the settlement).
The government alleged Ortho-McNeil promoted Topamax for off-label psychiatric uses through a program called “Doctor-for-a-Day, in which the J&J unit hired outside physicians to join sales reps in visiting other docs and to speak at meetings and dinners about prescribing Topamax for unapproved uses and doses.
One whistleblower, Gary Spivack, says he learned of this when he attended a “Psychiatry Consultants’ Conference” sponsored by the J&J unit. The attendees were paid $500 each or more as “consultants” simply to show up and listen to company presentations. The vast majority concerned off-label uses of Topamax and effectiveness claims for unapproved uses, according to a statement from Spivack (here is his lawsuit).
pic thx to katerha on flickr
Former SP
Unfortunately, the penalty is not harsh enough. It does not fit the “crime.” There is no accountability for the actions of the executives and the management team that allowed the off-label promotion to take place just to push more drug use for more money in their pockets. Until the decision-makers are held responsible, face personal fines, face criminal charges and fines, these pharma practices will continue unabated. let’s see, I can make $10 billion, but I have to pat $520 million in fines and admit no wrongdoing. My net profit is $9.5 billion and this is good business. Nevermind that thousadns of people were harmed by my actions, I’m rich! besides, the sahareholders pay the fine and I laugh all the way to the bank. Educated crooks lead to a corrupt industry. Wall Street is a perfect example!
M. Black
Then people wonder why there is a lack of trust between industry and the public.
For the love of [God], $81M NOT ENOUGH.
MB
M. Black
Interesting picture with this headline, Ed.
MB
Devil's Advocate
Points to Ponder:
1. So if a physician uses a drug based on published off-label use in a medical journal, is he or she open to penalties?
2. If you were a suffering patient or had a loved one who has tried everything to improve their quality of life (or save their life) and your doctor suggested an off-label use which might work, would you say NO? You would rather wait and hope that in years it would be in black and white in the P.I. (Package Inset)?
3. As a patient, using a drug off-label and you receive a call that the doctor stating to stop using it but you FINALLY found something that works, would you stop?
I am not in favor of out-right promotion of an off-label use, especially when it includes a small trial of 12 patients and a monkey. However, as a person, who is actively involved in my health, I DO want to know all the options for improving and saving lives when it comes to my life and those of loved ones. I EXPECT my doctor to know the latest and greatest on how drugs can make a difference. It does seem self-serving when that information comes from a drug rep, but should that make it illegal? How many doctors spend their free time actually keeping up on the latest medical news or do they rely on others to give it to them. How many doctors even know the specialists they refer to and sit down on their own dime, and personal time learning what is being seen in each others’s practice?
Anyone want to talk about actual examples when approvals followed market usage by years, even a decade? How many patients were thankful they had access to an “off-label” drug during that time.
I think the govenment has found another way to bring in the revenue from those, “greedy drug companies”. God help us all when more money goes into the legal profession and gov’t pockets instead of R&D.
Yes, I am a former drug representative of 12 years. Yes, I have seen abuse in the industry. AND Yes, I do believe there are companies and people, who want to make a difference in the lives of others. Keep an open mind and hope others are open when you are in need.
Angel
Devil’s Ad writes: “I DO want to know all the options for improving and saving lives when it comes to my life and those of loved ones. I EXPECT my doctor to know the latest and greatest on how drugs can make a difference. It does seem self-serving when that information comes from a drug rep, but should that make it illegal?”
I certainly follow the argument. But, yes, I do think it should be illegal for reps to promote unapproved uses. The arguments that this is the only way docs will learn, etc. just don’t counterbalance the downside.
That said, there are obviously degrees of malfeasance in this arena. Paying docs to rx for off-label, creating indications where there is zilch data, suppressing internal studies that actually show harm from such use, etc., add to the heinousness quotient, needless to say.
rep
Doxepin (generic antidepressant), used for years for sleep off label was recently REBRANDED and officially approved for sleep. I’m sure the idiots on this blog will complain that the penny they used to pay now costs a dollar again.
Idiot
I’m sure there’s a point to what rep writes. I just don’t follow what it is.
But here’s another scenario. If gabapentin was ever shown actually to be useful for bipolar disorder–rather than the horse manure put out by WL that kept who knows how many pts from getting genuinely efficacious treatment–it would probably be worth some price increase.
rep
Worse yet, most will still probably pay for generic doxepin, instead of the brand, and not support the company that actually did the research they demanded.
Jim
I currently take two prescription drugs, both in off-label indications. Both have significantly improved my QOL, and I know that in at least one case the manufacturer paid a very large fine for promoting the drug in the indication for which I use it.
All in all I agree with the fine, but its pretty hard for me to work up a lot of moral outrage over something I ultimately benefited from.
Grandfather
But what if Peter hadn’t caught the wolf?