Johnson & Johnson to pay $2.2 billion to resolve off-label marketing and kickback allegations

Johnson & Johnson and subsidiaries will pay more than $2.2 billion for allegedly promoting three drugs for unapproved uses in the elderly, children and mentally disabled, as well as purportedly paying kickbacks to doctors and the country’s biggest long-term care pharmacy provider in what the federal government maintains is one of the largest healthcare fraud settlements in U.S. history.

“Put simply, this alleged conduct is shameful, and it is unacceptable,” U.S. Attorney General Eric Holder said in a press conference last week. “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.”

The resolution addresses the government’s charges that, allegedly, J&J and/or its subsidiaries:

• Promoted risperidone (Risperdal) to treat anxiety, agitation, depression, hostility and confusion in elderly patients with dementia at a time (March 2002 to December 2003) when the medication was approved only to treat schizophrenia.
• Provided bonuses to sales representatives who successfully pushed the “off-label” use of the drug.
• Marketed risperidone to control behavior and conduct in elderly nursing home residents from 1999 to 2005, despite warnings from the Food and Drug Administration (FDA) that its marketing would be “misleading” and despite research showing that use of risperidone “posed serious health risks for the elderly, including an increased risk of strokes” and diabetes.
• Tried to suppress or dilute research findings to downplay the health risks associated with the drug.
• Paid speakers’ fees to physicians who increased their prescribing of risperidone.
• Marketed risperidone for treatment of children during a time that it was not approved for use in children, and for use in those with mental disabilities.
• Marketed schizophrenia/schizoaffective disorder drug paliperidone (Invega) for off-label uses.
• Paid kickbacks to pharmacy company Omnicare, which specializes in dispensing drugs to nursing home residents, to induce the company and its consultant pharmacists to actively promote risperidone and other J&J drugs to physicians treating nursing home residents.
• Promoted off-label uses of heart failure drug nesiritide (Natrecor).

J&J will plead guilty to one misdemeanor violation of the Food, Drug and Cosmetic Act. The company also will implement a five-year “corporate integrity agreement” with the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG). The agreement requires the company to recoup bonuses and incentives from current and former executives who engage in significant misconduct; to be transparent in its research practices, publication policies and payments to physicians; and to obtain verification from senior executives and board of director members that they have complied with the terms of the agreement. The company also must submit annual reports to HHS-OIG about its compliance program and business operations.

“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," Michael Ullmann, J&J’s vice president and general counsel, said in a press release. "We remain committed to working with the [FDA] and others to ensure greater clarity around the guidance for pharmaceutical industry practices and standards."

Additional information is available on the Department of Justice website.