by Ben Vernia | November 22nd, 2011
On November 22, the Department of Justice announced another large settlement in a case involving an arthritis prescription drug. According to DOJ’s press release:
American pharmaceutical company Merck, Sharp & Dohme has agreed to pay $950 million to resolve criminal charges and civil claims related to its promotion and marketing of the painkiller Vioxx® (rofecoxib), the Justice Department announced today. Under the terms of the resolution, Merck will plead guilty to a one-count information charging a single violation of the Food Drug and Cosmetic Act (FDCA) for introducing a misbranded drug, Vioxx®, into interstate commerce. Under the terms of its plea agreement with the United States, Merck will plead guilty to a misdemeanor for its illegal promotional activity and will pay a $321,636,000 criminal fine.
Merck is also entering into a civil settlement agreement under which it will pay $628,364,000 to resolve additional allegations regarding off-label marketing of Vioxx® and false statements about the drug’s cardiovascular safety. Of the total civil settlement, $426,389,000 will be recovered by the United States, and the remaining share of $201,975,000 will be distributed to the participating Medicaid states. The settlement and plea conclude a long-running investigation of Merck’s promotion of Vioxx®, which was withdrawn from the marketplace in September 2004.
Merck’s criminal plea relates to misbranding of Vioxx® by promoting the drug for treating rheumatoid arthritis, before that use was approved by the Food and Drug Administration (FDA). Under the provisions of the FDCA, a company is required to specify the intended uses of a product in its new drug application to FDA. Once approved, the drug may not be marketed or promoted for so-called “off-label” uses – any use not specified in an application and approved by FDA – unless the company applies to the FDA for approval of the additional use. The FDA approved Vioxx® for three indications in May 1999, but did not approve its use against rheumatoid arthritis until April 2002. In the interim, for nearly three years, Merck promoted Vioxx® for rheumatoid arthritis, conduct for which it was admonished in an FDA warning letter issued in September 2001.