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J&J close to settlement on Risperdal illegal marketing charges

Jan 1, 2012 | Parker Waichman LLP

Wall Street Journal reports that Johnson & Johnson is nearing a settlement agreement on federal charges that it illegally marketed its schizophrenia drug Risperdal. The settlement is believed to range between $1.5 and $1.7 billion. 

Dept. of Justice prosecutors have been pursuing illegal marketing charges against Johnson & Johnson for encouraging physicians and other health care professionals to dispense Risperdal for indications other than what it is approved to treat. The federal government is believed to be seeking $2 billion before it agrees to a settlement and recently rejected a $1 billion offer the pharmaceutical giant offered earlier this year. The settlement would cover lawsuits and other investigations conducted by state governments which seek to regain the money they paid for prescriptions to patients receiving the drug who shouldn't have.

The Justice Dept. has weighed felony charges against Johnson & Johnson, and its subsidiary Janssen Pharmaceuticals Inc. for these illegal marketing tactics and a conviction would likely prevent the company from selling drugs to health care facilities and patients participating in the federal Medicare program.

Sales of Risperdal reached a peak in 2007, just before Johnson & Johnson lost patent exclusivity on the drug, topping $2.2 billion in revenue that year.

To get nursing homes and nursing home pharmacies to dispense Risperdal and other schizophrenia drug, Invega, Janssen officials offered millions of dollars in bribe. One company to take the bribe was Omnicare Inc. Getting the drugs prescribed for indications like dementia and Alzheimer's disease boosted sales but the drug has never been approved for these symptoms or conditions. Janssen also allegedly urged phsycians to prescribe Risperdal to children even though it is only approved to treat adults suffering from schizophrenia.

J&J and Janssen also used false evidence to convince Medicaid officials that Risperdal was more effective than other drugs used to treat schizophrenia, the report indicates. The companies have already paid billions to settle other investigations waged by states looking to recoup the money they spent believing the deceptive marketing of these drugs.

Risperdal is an expensive option among antipsychotic drugs and carries with it several serious risks of side effects. Patients taking Risperdal are more likely to suffer a stroke and 50 percent more likely to develop diabetes than if they took another drug in the same class to treat symptoms of schizophrenia. Common side effects of taking Risperdal are irregular heartbeats, muscle weakness and spasms, high fever, constipation, weight gain, and headaches. More serious side effects to Risperdal include Neuroleptic Malignant Syndrome (NMS) and Tardive Dyskinesia.

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