Big Pharma Takes Big Hit, to the Tune of a Half Billion Dollars

AstraZeneca to pay $520 million to settle claims, PA to receive $9 million

HARRISBURG – Pennsylvania will receive more than $9 million as part of a $520 million settlement with the drug company AstraZeneca Pharmaceuticals LP resolving allegations that the drug company engaged in improper marketing for the antipsychotic drug Seroquel.

Attorney General Tom Corbett said that the joint federal and state investigation alleged that AstraZeneca engaged in a pattern of unlawful marketing activity, including “off-label” marketing and kickbacks to promote and sell Seroquel.

Corbett explained that off-label marketing involves promoting a drug for uses that have not been approved by the U.S. Food and Drug Administration (FDA).  While it is not illegal for a physician to prescribe a drug for an unapproved use, federal law prohibits a manufacturer from promoting a drug for uses not approved by the FDA.

According to the settlement, from Jan. 1, 2001 through Dec. 31, 2006, AstraZeneca promoted the sale and use of Seroquel for certain uses that the Food and Drug Administration (FDA) had not approved.

Corbett said that the settlement also resolves allegations that the company’s promotional activities were directed not only to psychiatrists but to primary care physicians and other health care professionals for unapproved uses in treatment of medical conditions such as aggression, Alzheimer’s disease, anger management, anxiety, attention deficit hyperactivity disorder, dementia and sleeplessness.

Additionally, AstraZeneca allegedly paid illegal kickbacks to doctors, including gifts, and complimentary visits to resort locations to “advise” AstraZeneca about marketing messages and articles, and to conduct studies for unapproved uses of Seroquel. Federal law prohibits payment of anything of value in exchange for prescribing a product paid for by a federal health care program.

Corbett said that the settlement also resolves claims that, as a result of their promotional activities, AstraZeneca caused physicians to prescribe Seroquel for children, adolescents and dementia patients in long term care facilities.

As part of the settlement, AstraZeneca is required to enter into a Corporate Integrity Agreement with the United States Department of Health and Human Services, Office of the Inspector General, which will closely monitor the company’s future marketing and sales practices.

Corbett said the settlement is based on whistle blower cases that were filed in the United States District Court for the Eastern District of Pennsylvania.

The investigation for Pennsylvania was handled by the Attorney General’s Medicaid Fraud Control Section and the Attorney General’s Health Care Section.