Johnson & Johnson To Pay $2.2 Billion To Settle Deceptive Marketing Claims

jjlogoFor 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 patients.

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 a statement.

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