This fraudulent scheme involves pharmaceutical companies promoting and marketing drugs for uses that have not been approved by the Food and Drug Administration (“FDA”). The FDA, among other things, governs the lawful interstate distribution of drugs for human use. A drug’s FDA approval largely determines whether a prescription for the use of that drug is properly reimbursed under federal health care programs such as Medicare, Medicaid or Tri-Care. Uses that are not approved by the FDA and are not included in the drug-approved labeling are considered “unapproved uses” or “off-label uses”, and companies promoting and marketing drugs for these uses can be in violation of the federal False Claims Act.
Examples of successful cases:
- In a 2010 case, Ortho-McNeil-Janssen Pharmaceuticals (“OMJPI”), a subsidiary of Johnson and Johnson, agreed to pay $75 million to resolve allegations that it had improperly marketed its anti-convulsant drug Topamax. Although Topamax was FDA-approved to prevent seizures, OMJPI marketed it as a weight-loss drug and treatment for bipolar disorder, among other non-approved uses.
- In 2012, British drugmaker GlaxoSmithKline agreed to pay a record $3 billion in civil and criminal penalties to resolve allegations that it engaged in the off-label marketing of several of its drugs, including Paxil and Wellbutrin. For example, although Paxil was only FDA-approved as an anti-depressant for adults, Paxil was marketed for treating depression in children, even though the FDA had not approved the drug for use by patients under 18 years old, and in fact clinical trials had shown the drug heightened the risk of suicide in minors.
- In Virginia, an international health care company pled guilty to off-label marketing practices, agreeing to pay $1.5 billion to resolve its criminal and civil liabilities. The company admitted to training a national sales force to promote a drug for off-label uses to health care providers and employees of nursing homes. The sales force specifically targeted the mentally unstable as well as elderly dementia patients.
In California, a pharmaceutical company was sentenced to pay $85 million in criminal fines in accordance to a plea agreement for off-label marketing. The company obtained FDA approval for the drug to be used in acute cases. Instead, the company admitted it intended for the drug to be used in chronic (non-acute) cases – an off-label use.