Big Pharma caught again…

Date: January 21, 2009

Eli Lilly Agrees to Pay $1.4 Billion to Settle Allegations of
Off-Label Promotion of Zyprexa

By Harry Silver; reviewed by Laura Laemmle-Weidenfeld*

Eli Lilly will pay more than a billion dollars after pleading guilty to criminal violations of the Food Drug and Cosmetic Act, and settling civil false claims actions with five qui tam relators, the United States, several states, and the District of Columbia. The criminal and civil charges arise out of allegations that Lilly instructed its sales force to promote the use of its antipsychotic drug, Zyprexa, for treatment of dementia after declining to seek FDA approval for such use. The government alleged that Lilly abandoned an effort to secure FDA approval because the use of Zyprexa for treatment of dementia produced mixed clinical results and because there were concerns about the drug’s safety risks. In fact, the government alleged that Zyprexa had side effects””such as significant weight gain””that could cause the elderly to develop hyperglycemia and diabetes. It was also alleged that Lilly promoted the off-label uses of the drug by providing gifts to physicians. According to the allegations, Lilly developed its sales campaign in order to overcome the anticipated resistance by physicians to prescribing Zyprexa for off-label uses. The $1.4 billion includes a criminal fine of $515 million which, according to a press release by the Justice Department, is the largest corporate criminal fine in history.

In addition to the financial settlement, Lilly agreed to enter into a corporate integrity agreement that, among other things, requires corporate employees, including the president and CEO, to certify annually that Lilly is in compliance with federal healthcare requirements. The CIA also requires Lilly to notify healthcare providers of the settlement, including the alleged violations leading up to the settlement. Lilly is also required to post on its website a list of physicians who receive payments from Lilly for serving as speakers or consultants, together with the amount of money each physician receives.

The Settlement Agreement, Information, and Corporate Integrity Agreement are available in the Practice Corner on the Fraud and Abuse Practice Group’s website.

*We would like thank Harry Silver, Esquire, and Laura Laemmle-Weidenfeld, Esquire (Patton Boggs LLP, Washington, DC) for submitting this email alert.

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Date: January 21, 2009 Eli Lilly Agrees to Pay $1.4 Billion to Settle Allegations of Off-Label Promotion of Zyprexa By Harry Silver; reviewed by Laura Laemmle-Weidenfeld* Eli Lilly will pay more than a billion dollars after pleading guilty to criminal violations of the Food Drug and Cosmetic Act, and settling civil false claims actions with five…
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