A Denial of Wrongdoing and a 2 Billion Dollar Misdemeanor
On November 4, 2013, the Department of Justice (DOJ) and Johnson
& Johnson (J&J) issued press releases (DOJ Press Release and J&J Press Release) announcing that the
federal government and 45 states were resolving claims related to
claims of off-label promotion of three drugs (Risperdal, Invega and
Natrecor) for $2 billion. The settlement requires a subsidiary
company accept "accountability for the actions described in
the misdemeanor plea." The settlement also requires the
company operate under a short 5 year Corporate Integrity Agreement while the
whistleblowers enjoy a whopping $167 million payment.
The Kickback Claims
The settlement includes payment of $149 million dollars to resolve whistleblower claims in US ex rel. Lisitza and Kammerer, et al. v. Johnson & Johnson, et al. Civ. No.: 07-10288, 05-11518 (D. Mass). Also settled on the eve of trial, is the whistleblower case U.S. ex rel. Gale v. Omnicare Inc., 10-cv-00127, U.S. District Court, Northern District of Ohio (Cleveland). The various whistleblower claims alleged that J&J used "market share rebate" agreements, "grant" and sponsorship fees to encourage Omnicare, which provides drugs to nursing home patients, to engage in "active intervention programs" reviewing patient charts and recommending physicians switch patients to Risperdal without regard to clinical appropriateness. For its part, Omnicare has agreed to pay $120 million, plus attorney's fees, to settle the lawsuit related to Omnicare's practices in connection with Medicare Part A, which provides prescription drug coverage for patients in skilled nursing facilities. That lawsuit claimed Omnicare violated the U.S. anti-kickback law by providing the discounts in exchange for referrals of patients with government-reimbursable drug costs.
Did They Misrepresent The Science Or Not?
The Food and Drug Administration's (FDA) News Release on the settlement states that the defendants
The government claimed that the manufacturer overstated the results of favorable studies, and did not disclose unfavorable study results (i.e. misstated or misrepresented scientific facts to prescribing physicians). As with most high profile and high price settlements involving the pharmaceutical industry, the defendant maintains that the settlement of the civil allegations "is not an admission of any liability or wrongdoing, and the Company expressly denies the government's civil allegations."
The Off-Label Conundrum
The DOJ confirms in the Plea Agreement that it is not illegal for a doctor to prescribe a drug for an off-label use. The FDA recognizes in its News Release that off-label prescribing is not prohibited and only rarely interferes with a physician's medical judgment. Physicians, consumers, and academics are unrestrained in recommending through any medium, including oral, written or electronic, any product for any use, irrespective of whether there is scientific or medical support for the use. For manufacturers the law is very different. If a pharmaceutical manufacturer, through any medium, "intends" its drug to be prescribed for a use that is not among those approved by the FDA, and introduces the drug into interstate commerce for that use, the drug is misbranded and the introduction of that misbranded drug into interstate commerce is a crime.
There are a number of reasons for FDA's hands-off approach: 1) Congress has largely excluded the practice of medicine from the reach of the FDA; 2) the practice of medicine is regulated by the states (See Planned Parenthood v Abbott); and 3) it is widely recognized that life saving therapy and the medical standard of care often demands a product be used off-label. Because people are unique, including their response to pharmacotherapy, the standard of care and sound medical judgment is an art which develops and evolves, providing for products to be used in new, unapproved ways. As the art of medicine evolves, all in our society are free to discuss this evolution, except the most potent participant, the manufacturer.
When The "Learned" Intermediary Is
Not Learned
A national survey of nearly 500 randomly sampled primary-care physicians and psychiatrists found that 55 percent of the time, doctors correctly identified the FDA-label status of drugs for particular indications. See Kevin B. O'Reilly, Physicians Know FDA-OK'd Uses for Drugs Half the Time, amednews.com, Sept. 14, 2009. According to one source, "[i]n 2001, there were an estimated 150 million off-label prescriptions (21% of overall use) of the sampled medications. . . . Most off-label drug medicines (73%) had little or no scientific support." David C. Radley et. al, Off-Label Prescribing Among Office-Based Physicians, 166 Archives of Internal Med. 1021–66 (May 8, 2006).
Manufacturers with reliable scientific information regarding a use
not in the FDA-approved labeling are throttled by the threat of
criminal prosecution under the rubric of off-label
promotion. Yet the data suggest that an urgent moral and
ethical imperative exists to provide more—not
less—reliable scientific and medical information concerning
unapproved new uses for FDA regulated products. In 2011, the
US Supreme Court in Sorrell v. IMS Health Inc.,131 S. Ct.
2653 (2011)addressed the issue of pharmaceutical marketing and
stated that "[s]peech in aid of pharmaceutical marketing,
however, is a form of expression protected by the Free Speech
Clause of the First Amendment." The Court applied strict
scrutiny to the State of Vermont's effort to limit
pharmaceutical marketing and struck down that state's statute
limiting information a manufacturer could use in its marketing of
regulated products. In 2012, in a landmark ruling by the
Second Circuit in US v. Caronia 703 F.3d 149, 169
(2d Cir. 2012), the landscape for off-label cases changed
dramatically. The Second Circuit ruled in favor of a
pharmaceutical sales representative holding:
The true cost of limiting what manufacturers say in marketing their products may not be measured merely by the billions of dollars paid in fines, but in the hundreds of millions of prescriptions written without sound, reliable scientific information by prescribing physicians. While the risk to patients is not insignificant when physicians rely on inconclusive science espoused by manufacturers in the promotion of its products, far more sinister and a greater risk exists when hundreds of millions of prescriptions are written each year based on no science whatsoever.
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