Lawrence Wasden (R)
BOISE, Idaho (Legal Newsline) – Pharmaceutical manufacturer Eli Lilly and Company has agreed to a $13 million settlement with the state of Idaho over allegations of failing to warn about the serious side effects of an anti-psychotic drug.
Eli Lilly’s failure to warn health care providers of the anti-psychotic Zyprexa’s serious side effects resulted in significant costs to the state’s Medicaid program from the drug’s unadvertised side effects.
The settlement also covers Eli Lilly’s alleged deceptive marketing of Zyprexa, which is the brand name for the prescription drug Olanzapine.
The state alleges that Eli Lilly marketed Zyprexa for off-label uses, including for use by children, and did not adequately disclose the side effects of the drug to health care providers. Side effects, the state alleged, included weight-gain related effects including hyperglycemia and diabetes.
Physicians are allowed to prescribe drugs for off-label uses, which are uses not approved by the FDA, but federal law prohibits pharmaceutical manufacturers from marketing their products for off-label uses.
“Off-label promotion of pharmaceutical drugs is a deceptive practice and creates unnecessary risks to consumers,” Attorney General Lawrence Wasden said. “In this instance, the company’s practices also resulted in additional costs to Idaho Medicaid, at the expense of Idaho taxpayers. Fortunately we were able to reach this settlement and recover those taxpayer dollars.”
Eli Lilly, under the terms of the settlement, is prohibited from making any false, misleading or deceptive claims in regards to Zyprexa.
The pharmaceutical manufacturer must also not take certain actions relating to dissemination of medical information, continuing medical education and grants, payments to consultants and speakers, product samples, and clinical research.
The settlement, which is still subject to court approval, is the state’s second largest financial recovery, after its 1998 tobacco settlement, under the Idaho Consumer Protection Act. The $13 million recovered is for losses incurred by Idaho’s Medicaid program and for consumer protection damages.
A portion of the settlement will be used to reimburse the federal government for its payments to Idaho Medicaid. Wasden estimate that $6.9 million of the settlement will go to the state’s general account.
The settlement does not, however, address claims by individual consumers. Eli Lilly currently faces multiple private class action cases seeking recovery of damages by individuals.