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Monday, November 04, 2013

Johnson & Johnson On The Hook To Pay $2.2 Billion To Settle Deceptive Marketing Claims

For nearly a decade, various state and federal agencies 
have been looking into Johnson & Johnson’s marketing of 
the drugs Risperdal, Invega, Natrecor, and others, claiming
 the company was putting consumers at risk by paying 
kickbacks to doctors and pharmacists to suggest these drugs
 to patients and for pushing unapproved uses for these
 medications. Today, the Justice Dept. announced that J&J
 will pay out more than $2.2 billion to settle these claims.
The DOJ alleges that Johnson & Johnson subsidiary Janssen
 Pharmaceuticals violated the Food, Drug, and Cosmetic Act
 by introducing the anti-psychotic drug Risperdal — which 
had only been approved for the treatment of schizophrenia
 — into the market for unapproved uses, like the treatment
 of dementia and other non-schizophrenic conditions.
Johnson & Johnson and Janssen Pharmaceuticals are also
 accused of promoting Risperdal and another anti-psychotic,
 Invega, to doctors and nursing homes as a way to control
 behavioral disturbances in elderly dementia patients,
 children, and the mentally disabled. The drug makers 
allegedly failed to mention — or downplayed — possible side
 effects of Risperdal, like the risk of stroke in elderly 
Additionally, the DOJ accuses the companies of paying 
kickbacks to doctors in order to urge them to prescribe 
these drugs, while also kicking back money to the ation’s
 largest long-term care pharmacy in order to get
 pharmacists to recommend off-label use of Risperdal for
 nursing home patients who exhibited behavioral symptoms
 associated with Alzheimer’s Disease and dementia.
In addition to this being against the law and unethical, it 
meant that millions of dollars in Medicare and Medicaid 
payments were being paid out on prescriptions that should 
never have been written.
“Through these alleged actions, these companies lined their 
pockets at the expense of American taxpayers, patients, 
and the private insurance industry,” said U.S. Attorney 
General Eric Holder in a statement. “They drove up costs 
for everyone in the health care system and negatively 
impacted the long-term solvency of essential health care 
programs like Medicare.”
Holder says that J&J and Janssen will plead guilty to 
misbranding Risperdal, and will pay $400 million in criminal 
fines and forfeitures, in addition to $1.2 billion to resolve 
their civil liability under the False Claims Act. Johnson & 
Johnson will pay an additional $149 million to resolve claims 
relating to alleged kickbacks to a long-term care pharmacy.
But wait. There’s more.
Another J&J subsidiary, Scios, has been accused of 
promoting the heart drug Natrecor for off-label use without 
credible scientific evidence that it would have any health 
benefit. Scios pleaded guilty in 2009 to misbranding 
Natrecor and paid a criminal fine of $85 million, and along 
with J&J has agreed to pay an additional $184 million to 
resolve the latest allegations.
“Put simply, this alleged conduct is shameful and it is 
unacceptable,” says Holder. “It displayed a reckless 
indifference to the safety of the American people. And it 
constituted a clear abuse of the public trust, showing a 
blatant disregard for systems and laws designed to protect 
public health.”
“Today we reached closure on complex legal matters 
spanning almost a decade. This resolution allows us to 
move forward and continue to focus on delivering innovative 
solutions that improve and enhance the health and well-
being of patients around the world,” said Michael Ullmann, 
Vice President and General Counsel, Johnson & Johnson, in 
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