Drugmakers to pay $563,000 for off-label marketing

Attorney General Joseph R. “Beau” Biden III’s office announced last week that the Attorney General’s Medicaid Fraud Control Unit had recovered more than half a million dollars for Delaware following the completion of separate multi-state and federal investigations of improper off-label marketing by pharmaceutical makers Novartis Pharmaceuticals Corporation and Novartis Vaccines & Diagnostics Inc., and AstraZeneca of two popular drugs.

As a result, the companies together are paying nearly $600 million to the investigating states and to the federal government. AstraZeneca will pay $520 million, Novartis $72.5 million.

The total settlement to Delaware’s state-federal cost-sharing Medicaid program is $1,258,356, with the payments split between the state and the federal government. The State of Delaware is receiving $563,065, which will be paid to the General Fund.

“These cases demonstrate Attorney General Biden’s commitment to protecting patients, looking out for taxpayers, and holding the pharmaceutical industry accountable for inappropriate and illegal sales and marketing practices,” stated Timothy Mullaney Sr., director of the Attorney General’s Fraud and Consumer Protection Division. “We will continue to join with other states and the federal government in cases such as these to enforce fair business practices in Delaware.”

Over a period of six years, from 2001 through 2006, investigators allege that AstraZeneca promoted Seroquel, an anti-psychotic medication used to treat psychological disorders, for certain treatments that the FDA had not approved, such as aggression, Alzheimer’s disease, anger management, anxiety, attention deficit hyperactivity disorder, dementia and sleeplessness.

The settlement with 50 states, the District of Columbia and the federal government resolved the government investigation into improper promotion by AstraZeneca to psychiatrists, primary-care physicians and other health care professionals. The settlement is based on qui tam cases that were filed in U.S. District Court by private parties.

The agreement with Novartis resolves allegations by 49 states, the District of Columbia and the federal government that, from January 2001 through July 2006, it promoted tobramycin, a cystic fibrosis drug marketed under the trade name TOBI, for off-label uses not approved by the FDA.

It also resolved claims brought by three former employees of Chiron Corp. – the company that manufactured TOBI before its 2006 acquisition by Novartis. The government alleges that the off-label marketing included for diseases other than cystic fibrosis and for cystic fibrosis patients younger than 6.