New Law Blogs

Birmingham News: Siegelman, Scrushy Seek Dismissal of Honest Services Fraud Charges

By Leah Nylen

The manufacturer of Botox agreed to plead guilty in a False Claims Act case, in which the pharmaceutical company, Allergan Inc., was accused of unlawfully promoting the anti-wrinkle drug, the head of the Justice Department Civil Division announced Wednesday.

Allergan will pay $600 million in fines and forfeiture as part of the plea agreement, with $37.8 million going to the five whistleblowers in the case.

Assistant Attorney General Tony West of the Civil Division said Allergan illegally marketed Botox for applications that were not endorsed by the Food and Drug Administration, including treatments for headaches, pain, juvenile cerebral palsy and spasticity. He said the company also gave kickbacks to doctors to encourage them to use the drug for off-label purposes, in addition to showing them how to miscode Botox for billing claims.

U.S. Attorney Sally Yates looks on as Assistant Attorney General Tony West announces the Allergan Inc. settlement. (photo by Andrew Ramonas / Main Justice)

West said the actions of Allergan aren’t “victimless crimes.”

“When our public health care programs are burdened with fraudulent charges, it drives the cost of health care up for all of us ? consumers  pay more in premiums; companies pay more to cover their employees,” West said at a news conference at DOJ headquarters. “And when a pharmaceutical manufacturer violates the integrity of the drug- approval process established by Congress and the FDA by paying kickbacks to encourage the off-label use of an unapproved drug, that not only undermines the judgments of health care professionals, but also threatens to put patients? health and safety at risk.”

U.S. Attorney Sally Yates of the Northern District of Georgia, whose office assisted with the case, said the Justice Department is committed to ensuring that prescription drugs are safe and federal health care funds aren’t wasted.

“With cases like this one, we hope to put an end to the practice known in the pharmaceutical industry as off-label marketing,” Yates said at the news conference.

Full post as published by Main Justice on September 01, 2010 (boomark / email).