Conn. announces settlement in Zyprexa case

John O'Brien Sep. 30, 2009, 4:49pm


HARTFORD, Conn. (Legal Newsline) - Another settlement has been announced in the final round of Zyprexa lawsuits brought by state attorneys general.

Eli Lilly & Co. is paying the State of Connecticut $25.1 million to settle allegations that the company marketed Zyprexa for off-label uses, and that the drug caused weight gain-related side effects like diabetes and hypertension.

After a $62 million settlement with state attorneys general, 12 states with claims remained. Most have settled, though the terms have not been announced yet. West Virginia settled its claim in August for more than $22 million, with $6.75 million going to private lawyers hired by state Attorney General Darrell McGraw.

"This illicit multi-billion dollar drug marketing scheme corrupted health care at the expense of taxpayers, senior citizens, children and others who suffered serious side effects from Zyprexa," Blumenthal said.

"Eli Lilly was aided and abetted by so-called independent physicians paid handsomely to promote Zyprexa for unapproved off-label uses -- ghost writing articles, downplaying dangers, and pitching the product.

Eli Lilly also agreed to pay $1.4 billion to settle federal civil and criminal claims stemming from the alleged off-label marketing.

The payment also benefited the Medicaid programs of more than 30 states that collectively received approximately $362 million.

In a 10-Q filing with the Securities and Exchange Commission, Lilly revealed in July that it incurred special charges of $105 million in the second quarter.

"We are in advanced discussions with the attorneys general for several states that were not part of the Eastern District of Pennsylvania settlement, seeking to resolve their Zyprexa-related claims, and we have reached settlement with the State of West Virginia," the filing says.

"The charge represents the currently probable and estimable exposures in connection with the states' claims."

Only Mississippi now has an unsettled case before U.S. District Judge Jack Weinstein. The other three, brought by South Carolina, Arkansas and Pennsylvania, are located in state courts.

The trial in South Carolina's case begins Monday. It can be viewed on Courtroom View Network.

Other settlements will be announced in the cases brought by the attorneys general of Utah, Montana, Idaho, Louisiana, Minnesota and New Mexico.

From Legal Newsline: Reach John O'Brien by e-mail at

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