$1.6 BILLION Pharmaceutical Company Payment For Off-Labeling Marketing

The large pharmaceutical company Abbott Laboratories (“Abbott”) has agreed to pay $1.6 billion, the second largest payment by a drug company, to settle an investigation into its drug marketing practices (the largest payment was $2.3 billion that was paid by Pfizer Inc. in 2009). The $1.6 billion includes $700 million in criminal fines and forfeiture and $800 million to settle civil claims brought by states and the federal government.

Additionally, Abbott agreed to pay $100 million to resolve state consumer protection claims, to plead guilty to a misdemeanor violation of  the federal Food, Drug and Cosmetic Act, and to be subjected to court-supervised probation for a five year period.

The settlements, payments, and guilty plea are related to Abbott’s misbranding (improper promotion/marketing) of its drug named Depakote. The only uses of Depakote that are approved by the FDA are for treatment of epilepsy, bipolar disorder, and in the prevention of migraines. One of the known safety risks of Depakote is liver disease. Sales of Depakote reached $1.7 billion in 2007.

According to the U.S. Department of Justice, Abbott promoted Depakote in controlling agitation and aggression in elderly dementia patients as well as in treating schizophrenia, both of which were not approved uses of Depakote by the U.S. Food and Drug Administration. Such improper marketing is often referred to as “off-label” use.

Abbott admitted that the off-label use of Depakote for elderly dementia patients who were agitated or aggressive in nursing homes was actively promoted by a specialized sales force between 1998 and 2006 despite no credible scientific evidence that Depakote was safe and effective for such use (Abbott discontinued a clinical trial of Depakote’s use in treating dementia in 1999 due to adverse effects such as dehydration, anorexia, and drowsiness). Additionally, Abbott also admitted that it paid millions of dollars in rebates to pharmacists who serviced nursing homes based on how much Depakote’s use was increased in the nursing homes that they serviced.

Abbott further admitted that Depakote’s use for treatment of schizophrenia in combination with other drugs was actively promoted between 2001 and 2006 without evidence that it was any more effective than other medications alone in the treatment of schizophrenia (two studies of Depakote’s use in the treatment of schizophrenia that were paid for by Abbott failed to meet their goals, which Abbott did not report to its sales force for two years and which were not published for an additional two years).

The recently announced settlements will result in some “whistle-blowers” receiving about $84 million as their share of the federal government’s recovery pursuant to the False Claims Act that provides for such incentives. The whistle-blowers had filed four lawsuits in federal court in Virginia regarding Abbott’s improper marketing promotion of off-label uses for Depakote.


Without the monetary incentives provided under the False Claims Act for whistle-blowers, one must wonder if the illegal activities of a giant pharmaceutical company would have been discovered and punished.

If you have a possible whistle-blower claim against a drug company or other large company in the United States, you may wish to consult with a medical malpractice lawyer or other attorney who is knowledgeable about whistle-blower claims and handles such claims.

Click here to visit our website to be connected with whistle-blower lawyers in your local area who may be able to advise you regarding your whistle-blower responsibilities and possible monetary recovery and to assist you in filing a whistle-blower claim, if appropriate.

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This entry was posted on Tuesday, May 8th, 2012 at 10:01 am. Both comments and pings are currently closed.


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