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Jan 27, 2014

Top 10 Biggest Biopharma Marketing Fines: 2014 Edition

Making false claims about your products not only doesn’t pay—it can cost you a lot of money.

Top 10 Biggest Biopharma Marketing Fines: 2014 Edition

Someone blew the whistle on these misbehaving firms. [© Peterfactors - Fotolia.com]

  • #5. Eli Lilly

    Amount of fine: $1.415 billion

    Drug(s) involved: Zyprexa (olanzapine)—$1.701 billion in 2012 sales

    Date penalty approved and/or announced: January 15, 2009

    Details of the admissions and resulting penalties: Lilly pleaded guilty to a misdemeanor criminal charge of off-label marketing of the drug as a treatment for dementia, including Alzheimer’s dementia, in elderly people. Lilly agreed to pay a criminal fine of $515 million, the largest fine imposed to that date in a healthcare case, and the largest criminal fine for an individual corporation ever imposed to that date in a U.S. criminal prosecution of any kind. Lilly also agreed to forfeit $100 million, and pay up to $800 million in a civil settlement with the federal government and the states to resolve civil allegations that its off-label marketing caused false claims for payment to be submitted to federal insurance programs such as Medicaid, TRICARE, and the Federal Employee Health Benefits Program.

  • #4. Abbott Laboratories

    Amount of fine: $1.6 billion

    Drug(s) involved: Depakote (divalproex sodium)—2012 sales figure unavailable

    Date penalty approved and/or announced: October 2, 2012

    Details of the admissions and resulting penalties: Abbott pleaded guilty to a criminal misdemeanor for misbranding Depakote by marketing the drug off-label to treat behavioral disturbances in dementia patients from January 1998 to December 2006, and schizophrenia from January 2002 to December 2006. Abbott was ordered to pay the second-largest fine for the marketing of an individual drug, including a $500 million criminal fine, forfeit $198.5 million, and pay $1.5 million to the Virginia Medicaid Fraud Control Unit. The company also agreed to pay $100 million to resolve state consumer-protection claims and $800 million to the federal government and the states to resolve civil claims that its unlawful marketing and illegal remuneration practices caused false claims to be submitted to government healthcare programs.

  • #3. Johnson & Johnson

    Amount of fine: $2.2 billion

    Drug(s) involved: Risperdal (risperidone)—$1.425 billion in 2012 sales
    Invega—$550 million in 2012 sales
    Natrecor—2012 sales figure unavailable

    Date penalty approved and/or announced: November 4, 2013

    Details of the admissions and resulting penalties: Johnson & Johnson and subsidiaries Janssen Pharmaceuticals and Scios agreed to pay $485 million in criminal penalties and $1.72 billion in civil settlements with the federal government and several states, all to resolve criminal and civil charges relating to the prescription drugs Risperdal, Invega, and Natrecor. Janssen pleaded guilty and will pay $400 million in criminal penalties—a $334 million criminal fine and forfeiture of $66 million—for introducing Risperdal as a misbranded drug into interstate commerce, plus $1.273 billion in a civil settlement, under an agreement overseen by the U.S. District Court for the Eastern District of Pennsylvania. Janssen and J&J also agreed to new corporate integrity requirements.

    J&J and Janssen also agreed to pay $149 million to settle DoJ claims that they paid millions of dollars in kickbacks intended to promote use of Risperdal and other J&J drugs in nursing homes by Omnicare and its consultant pharmacists. J&J and Janssen were also cited for off-label marketing of antipsychotic drug Invega, approved only for schizophrenia and schizoaffective disorder, and for making false and misleading statements about its safety and efficacy.

    J&J and Scios agreed to pay the federal government $184 million to resolve civil charges that they caused submission of false and fraudulent claims to federal health care programs for heart failure drug Natrecor.

  • #2. Pfizer

    Amount of fine: $2.3 billion

    Drug(s) involved: Lyrica (pregabalin)—$4.158 billion in 2012 sales
    Zyvox (linezolid)—$1.345 billion in 2012 sales
    Bextra—2012 sales figure unavailable
    Geodon (also marketed as Zeldox; ziprasidone)—2012 sales figure unavailable

    Date penalty approved and/or announced: September 2, 2009

    Details of the admissions and resulting penalties: Pfizer’s Pharmacia & Upjohn subsidiary pleaded guilty to a felony violation of the Food, Drug, and Cosmetic Act for misbranding Bextra with the intent to defraud or mislead. In addition, Pfizer agreed to pay a criminal fine of $1.195 billion, the largest U.S. criminal fine ever imposed to that date. Pharmacia & Upjohn also agreed to forfeit $105 million, for a total criminal resolution of $1.3 billion. Pfizer agreed to pay $1 billion to resolve allegations that the company illegally promoted the drugs, and caused false claims to be submitted to government health care programs for uses that were not medically accepted indications and therefore not covered by those programs. The federal share of the civil settlement was $668,514,830 and the state Medicaid share, $331,485,170.

  • #1. GlaxoSmithKline

    Amount of fine: $3 billion

    Drug(s) involved: Advair (fluticasone/salmeterol)—$8.3 billion in 2012 sales5
    Flovent (fluticasone)—About $1.3 billion in 2012 sales5
    Lamictal (lamotrigine)—About $1 billion in 2012 sales5
    Paxil (paroxetine)—$615.4 million in 2012 sales5
    Valtrex (valacyclovir)—$413.9 million in 2012 sales5
    Imitrex (sumatriptan)—$312.1 million in 2012 sales5
    Wellbutrin (bupropion)—$138.2 million in 2012 sales5
    Avandia (rosiglitazone)—$9.9 million in 2012 sales5
    Zofran (ondansetron)—2012 sales figure not available

    Date penalty approved and/or announced: July 2, 2012

    Details of the admissions and resulting penalties: GSK pleaded guilty to two counts of introducing misbranded drugs, Paxil and Wellbutrin, into interstate commerce, and one count of failing to report safety data about Avandia to FDA. GSK also agreed to pay $1 billion consisting of a criminal fine of $956,814,400 and forfeiture of $43,185,600; as well as a $2 billion civil settlement resolving claims for (1) promoting the drugs Paxil, Wellbutrin, Advair, Lamictal and Zofran for off-label, noncovered uses and paying kickbacks to physicians to prescribe those drugs as well as the drugs Imitrex, Lotronex, Flovent and Valtrex; (2) making false and misleading statements concerning the safety of Avandia; and (3) reporting false best prices and underpaying rebates owed under the Medicaid Drug Rebate Program.



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