DOJ announces J&J subsidiaries to pay $81 million to settle off-label allegations concerning Topamax; one to plead guilty

by Ben Vernia | April 29th, 2010

The Department of Justice announced on April 29 that Ortho-McNeil Pharmaceutical, LLC, and Ortho-McNeil-Janssen Pharmaceuticals, Inc., two subsidiaries of Johnson & Johnson, have agreed to pay $81 million to settle charges brought in two whistleblower suits that they violated the False Claims Act by promoting Topamax for off-label (unapproved) uses. According to the Department’s press release:

Ortho-McNeil Pharmaceutical LLC has agreed to plead guilty to a misdemeanor and pay a $6.14 million criminal fine for the misbranding of Topamax in violation of the Food, Drug and Cosmetic Act. The Food and Drug Administration (FDA) approved Topamax as an anti-epileptic drug, for the treatment of partial onset seizures, but not for any psychiatric use. Once a pharmaceutical is approved by the FDA, a manufacturer may not market or promote it for any use not specified in its new drug application. The unauthorized uses are also known as “unapproved” or “off-label uses.”

The government alleged that Ortho-McNeil Pharmaceutical promoted the sale of Topamax for off-label psychiatric uses through a practice known as the “Doctor-for-a-Day” program. Using this program, Ortho-McNeil hired outside physicians to join sales representatives in their visits to the offices of health care providers and to speak at meetings and dinners about prescribing Topamax for unapproved uses and doses.

In addition to the criminal fine, Ortho-McNeil-Janssen Pharmaceuticals will pay $75.37 million to resolve civil allegations under the False Claims Act that they illegally promoted Topamax and caused false claims to be submitted to government health care programs for a variety of psychiatric uses that were not medically accepted indications and therefore not covered by those programs.

Ortho-McNeil-Janssen has also agreed to a Corporate Integrity Agreement. Regarding the CIA, the Department’s press release said:

Also as part of the settlement, Ortho-McNeil-Janssen Pharmaceuticals has agreed to enter into an expansive corporate integrity agreement with the Office of Inspector General of the Department of Health and Human Services. That agreement provides for procedures and reviews to be put in place to avoid and promptly detect conduct similar to that which gave rise to this matter.

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“This settlement is about more than financial recoveries, it is also about protecting the integrity of health care programs and the health of beneficiaries,” said Department of Health and Human Services Inspector General Daniel R. Levinson. “The Corporate Integrity Agreement requires Ortho-McNeil-Janssen-Pharmaceuticals, Inc. to increase transparency and accountability and to make changes designed to avoid illegal drug promotion in the future.”

The Department reports that the federal share of the recovery is approximately $51 million, and that the relators will receive $9 million of this (approximately 17.7%).

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