Allergan Inc., the maker of wrinkle-smoothing Botox, has agreed to pay $600 million to settle a year-long federal investigation into its marketing of the top-selling, botulin-based drug. The Justice Department says the company will plead guilty to one misdemeanor charge of “misbranding.” It appears the company’s marketing led physicians to use Botox for unapproved uses. Those included the treatment of headache, pain, spasticity and cerebral palsy in children.
As we have previously reported, manufacturers are prohibited from promoting drugs for unapproved, or “off-label,” uses. Allergan will pay $375 million in connection with the plea, which includes the forfeiture of $25 million in assets. Additionally, the company will pay $225 million in civil fines – $210 million to the federal government and the rest to several states – related to the investigation.
Allergan, based in Irvine, California, also reached an agreement with the Department of Health and Human Services’ Office of the Inspector General that requires the company to submit compliance reports, and to post on its website any payments to doctors, such as honoraria, travel or lodging.
Assistant Attorney General Tony West said Allergan “paid kickbacks to induce physicians to inject Botox for off-label uses and Allergan also taught doctors how to bill for off-label uses, including coaching doctors how to miscode Botox claims leading to millions of dollars of false claims being to submitted to federal and state programs.” The settlement is not final until approved by a federal judge. Sally Yates, U.S. Attorney for the Northern District of Georgia, had this to say:
The FDA had approved therapeutic uses of Botox for only four rare conditions, yet Allergan made it a top corporate priority to maximize sales of far more lucrative off-label uses that were not approved by the FDA. Allergan further demanded tremendous growth in these off-label sales year after year, even when there was little clinical evidence that these uses were effective.
The investigation was started by a whistle-blower complaint. Allergan’s product sales topped $4.4 billion in 2009, with Botox accounting for more than $1.3 billion of that total. The Justice Department’s investigation covered Allergan’s marketing of Botox from 2001 through at least 2008. In recent years, federal investigators have reached multibillion dollar settlements with Pfizer, Eli Lilly and other drug companies over their marketing practices.
Source: Associated Press
Contact us today for a free legal consultation with an experienced attorney.
Fields marked *may be required for submission.
If you would like to subscribe to the Jere Beasley Report digital edition, simply visit our Subscriptions page and provide the necessary information or call us at 800-898-2034.
Attorney Advertising - Prior results do not guarantee a similar outcome.