Pfizer Settles Neurontin Off-Label Marketing Lawsuit for $427M

Pfizer Inc., the world’s largest pharmaceutical company, has agreed to plead guilty and pay more than $430 million to settle all criminal charges and civil liabilities related to the illegal and fraudulent promotion of unapproved uses for its top selling epilepsy drug Neurontin by Warner-Lambert’s Parke-Davis Division, the Justice Department said in a prepared statement issued on Thursday.

“The Department of Justice is committed to rooting out and prosecuting health care fraud,” said Associate Attorney General Robert McCallum. “The Department’s commitment to effective health care fraud enforcement is driven by a mandate that wrongdoers be brought to justice, to deter conduct which threatens the safety and welfare of all Americans, and the need to protect the resources of the Medicare Trust Fund, state Medicaid programs, and other government health programs.”

Neurontin

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Neurontin was approved in 1993 for the treatment of partial seizures with and without secondary generalization in adults with epilepsy. In 2002, Pfizer received approval for Neurontin for treatment of post-herpetic neuralgia.

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 the Food and Drug Administration.

Off-Label Uses

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However, Warner-Lambert’s strategic marketing plans, as well as other evidence, show that Neurontin was aggressively marketed to treat a wide array of ailments for which the drug was not approved, the Justice Department said. The company promoted Neurontin for the treatment of bipolar mental disorder, various pain disorders, Lou Gehrig’s Disease, attention deficit disorder, migraine, drug and alcohol withdrawal seizures, restless leg syndrome, and as a first-line monotherapy treatment for epilepsy (using Neurontin alone, rather than in addition to another drug).

Warner-Lambert promoted Neurontin even when scientific studies had shown it was not effective, the Justice Department said. For Example, the company falsely promoted Neurontin as effective for treating bipolar disease, even when a scientific study demonstrated that a placebo worked as well or better than the drug.

“This illegal and fraudulent promotion scheme corrupted the information process relied upon by doctors in their medical decision-making, thereby putting patients at risk,” stated U.S. Attorney Michael Sullivan.

Consequence of Illegal Marketing Scheme

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As a consequence of the unlawful promotion scheme, patients who received the drug for unapproved and unproven uses had no assurance that their doctors were exercising their independent and fully-informed medical judgment, or whether the doctor was instead influenced by misleading statements made by, or inducements provided by, Warner-Lambert, the Justice Department said. Potential problems that can arise from off-label use without the benefit of careful FDA oversight include the occurrence of unforeseen adverse effects because the drug was not studied in the type of patient it is being used for off-label and the appropriate dosage and course of treatment have not been established.

“The plea agreement and settlement announced today marks the end of an exemplary effort to use all of the appropriate anti-fraud weapons available to us in a concerted manner to send clear and unequivocal messages to the pharmaceutical industry,” said Assistant Attorney General Peter D. Keisler. “To insure a just result, we in the Civil Division will vigilantly join our tools for fighting fraud on consumers with those available to remedy fraud on the federal health care programs.”

Illegal Marketing Tactics

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Warner-Lambert used a number of tactics to achieve its marketing goals, including encouraging sales representatives to provide one-on-one sales pitches to physicians about off-label uses of Neurontin without prior inquiry by doctors, the Justice Department said. The company’s agents also made false or misleading statements to health care professionals regarding Neurontin’s effectiveness. The company also utilized “Medical Liaisons,” who represented themselves (often falsely) as scientific experts in a particular disease, to promote off-label uses for Neurontin.

Warner-Lambert paid doctors to attend so-called “consultants meetings” in which physicians received a fee for attending expensive dinners or conferences during which presentations about off-label uses of Neurontin were made, the Justice Department said. These events included lavish weekends and trips to Florida, the 1996 Atlanta Olympics and Hawaii. There was little or no significant consulting provided by the physicians.

The pharmaceutical company implemented numerous teleconferences in which physicians were recruited by sales representatives to call into a pre-arranged number where they would listen to a doctor or a Warner-Lambert employee speak about an off-label use of Neurontin.

The company also sponsored purportedly “independent medical education” events on off-label Neurontin uses with extensive input from Warner-Lambert regarding topics, speakers, content, and participants.

Warner-Lambert paid physicians to allow a sales representative to accompany the physician while he or she saw patients, with the representative offering advice regarding the patient’s treatment, which was biased towards the use of Neurontin, the Justice Department said.

These tactics were part of a widespread, coordinated national effort to implement an off-label marketing plan. At the same time, Warner-Lambert decided not to seek FDA approval for any of the new uses because it was concerned that approval for any of the non-epilepsy uses would allow generic competitors of Neurontin, which was expected to go off-patent soon, to compete with a “son of Neurontin” drug that Warner-Lambert hoped to have approved by the FDA for both epilepsy and non-epilepsy uses, the Justice Department said.

Building a Blockbuster Drug

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Neurontin was launched into the marketplace in February of 1994; from mid-1995 to at least 2001, the growth of off-label sales was tremendous. While not all of these sales were the consequence of Warner-Lambert’s illegal marketing, the marketing scheme was very successful in increasing Neurontin prescriptions for unapproved uses, the Justice Department said.

The state Medicaid programs were harmed by Warner-Lambert’s aggressive promotion for off-label uses in numerous ways. The conduct caused doctors to write prescriptions for Medicaid patients when those medications were not eligible for Medicaid reimbursement in that the prescriptions were fraudulently obtained through false statements to doctors and by payment of illegal kickbacks, including so called “consulting fees” and trips for physicians.

The Whistle-blower

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The investigation was commenced in the District of Massachusetts when a former medical liaison for Warner-Lambert, Dr. David Franklin, filed a suit on behalf of the U.S. government. Private individuals like Dr. Franklin are allowed to file whistleblower suits under the federal False Claims Act to bring the United States information about wrongdoing. If the United States is successful in resolving or litigating the whistleblower’s claims, the whistleblower may share in part of the recovery. As a part of today’s resolution, Dr. Franklin will receive approximately $24.64 million of the civil recovery.

Under the Agreement

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(a) Warner-Lambert has agreed to plead guilty to two counts of violating the Food, Drug & Cosmetic Act with regard to its misbranding of Neurontin by failing to provide adequate directions for use and by introduction into interstate commerce of an unapproved new drug. Warner-Lambert has, as punishment for these offenses, agreed to pay a $240 million criminal fine, the second largest criminal fine ever imposed in a health care fraud prosecution. The Plea Agreement between the United States and Warner-Lambert specifically states that Warner-Lambert’s criminal conduct caused losses of $150 million and that the violations are felonies as a consequence of Warner-Lambert’s prior Food, Drug & Cosmetic Act conviction.

(b) Warner-Lambert has agreed to settle its federal civil False Claims Act liabilities and to pay the United States $83.6 million, plus interest, in civil damages for losses suffered by the federal portion of the Medicaid program as a result of Warner-Lambert’s fraudulent drug promotion and marketing misconduct.

(c) Warner-Lambert has agreed to settle its civil liabilities to the fifty states and the District of Columbia in an amount of $68.4 million, plus interest, for losses the state Medicaid programs suffered as a result of Warner-Lambert’s fraudulent drug promotion and marketing misconduct.

(d) Warner-Lambert has agreed to settle its civil liabilities to the fifty states and the District of Columbia in an amount of $38 million, plus interest, for harm caused to consumers and to fund a remediation program to address the effects of Warner-Lambert’s improper marketing scheme. This part of the global settlement agreement was negotiated by the Consumer Protection divisions of the fifty State Attorneys General.

(e) Pfizer Inc, Warner-Lambert’s parent company, has agreed to comply with the terms of a corporate compliance program, which will ensure that the changes Pfizer Inc made after acquiring Warner-Lambert in June 2000, are effective in training and supervising its marketing and sales staff, and ensures that any future off-label marketing conduct is detected and corrected on a timely basis. In addition, Warner-Lambert agreed to an injunction by a state court against continuing the improper conduct that was the subject of the States’ Consumer Protection Divisions investigation.

Pfizer Inc, the owner of Warner-Lambert since June of 2000, has also agreed to institute a compliance program. The charged conduct occurred prior to the acquisition.

(via U.S. Department of Justice)