Op-ed slams Ark. AG's handling of Eli Lilly settlement funds

Jessica M. Karmasek Jul. 26, 2011, 2:17pm


LITTLE ROCK, Ark. (Legal Newsline) - An Arkansas columnist is calling out state Attorney General Dustin McDaniel for his office's distribution of lawsuit settlement money.

John Brummett, a columnist for the Arkansas News, took issue with the attorney general's handling of the $18.5 million from pharmaceutical company Eli Lilly in a June 5 opinion piece.

In February 2010, McDaniel announced that his office settled its lawsuit, filed in 2008, against the company over its promotion of the drug Zyprexa.

In 2009, the drug company settled with multiple entities over its off-label promotion of the drug and agreed to pay $1.42 billion in penalties, including $362 million to 32 states and the District of Columbia, $438 million to the federal government and $615 million to end a criminal probe.

According to the Attorney General's Office, about $1.4 million of Arkansas' settlement was allocated to the Arkansas Medicaid Program as reimbursement for improper payments due to the off-label marketing of Zyprexa.

The Attorney General's Consumer Education and Enforcement Fund also received $2 million to support future consumer investigations and prosecutions. About $15 million was placed in the Medicaid Program Trust Fund, McDaniel's office said.

In his column, Brummett said McDaniel also took some of that settlement money to make his office "a special investigator and locally deputized prosecutor of sex predators of children on the Internet."

"He also made his office the place for a new cyberspace forensics unit to track these Internet child-porn creeps," the columnist wrote.

Brummett argues that McDaniel did so "for noble purposes that, coincidentally, serve to enhance his political standing."

He also argues that, in doing so, McDaniel benefits his "inevitable" race for governor -- "an office that soon will amount to a demotion considering the way the attorney general keeps getting more presumptuously powerful," Brummett wrote.

The attorney general recently told the columnist that sometimes good policy and good politics fuse and that the Eli Lilly settlement is such an example.

But Brummett argues that Arkansas simply has "entirely too many" independent cash funds, with money coming into state agencies and the agencies spending it as they wish.

Instead, he suggests the state Legislature appoint a special study committee to identify and count up the money and "figure out if it might be more efficient and fiscally accountable to the people to bring all of it into the general appropriation process."

From Legal Newsline: Reach Jessica Karmasek by email at jessica@legalnewsline.com.

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