Drugmaker paying $1.5B over Depakote

John O'Brien May 7, 2012, 1:00pm


WASHINGTON (Legal Newsline) - Abbott Laboratories is paying $1.5 billion to resolve criminal and civil liability arising from its marketing of the prescription drug Depakote.

The federal government will receive $700 million in the agreement, while states will split $700 million. Abbott allegedly promoted its drug to control agitation and aggression in elderly dementia patients and to treat schizophrenia, even though the federal Food and Drug Administration never approved the drug for those uses.

The drug was approved by the FDA to treat epileptic seizures, bipolar mania and migraines.

"Today's settlement demonstrates our continued scrutiny of the sales and marketing practices of pharmaceutical companies that put profits ahead of patient health," said U.S. Food and Drug Administration Commissioner Margaret Hamburg.

"The FDA will continue its due diligence and hold pharmaceutical companies accountable for marketing practices that undermine the drug approval process."

In 2007, the office of then-Virginia Attorney General Bob McDonnell was contacted with allegations of off-label marketing. Neither the whistleblowers nor the defendant were located in Virginia, but now-AG Ken Cuccinelli says his office was contacted because of its national reputation.

Virginia had a hand in landing a $600 million fine paid by Purdue Pharma, the maker of OxyContin.

The Virginia Medicaid Fraud Control Unit contacted the U.S. Attorney's Office for the Western District of Virginia following its initial investigation. A whistleblower suit was filed on Oct. 31, 2007.

"I'm committed to stopping fraud against taxpayers and I've made fighting Medicaid fraud a priority in Virginia by increasing the size of our fraud team by 50 percent over the last two years," Cuccinelli said.

"I'm committed to ensuring that money intended for medical services for the poor isn't stolen from them through fraud. Medicaid dollars are limited, and fraud deprives people in true need of necessary medical care."

Several state attorneys general put out press releases touting their respective states' hauls from the agreement.

Virginia is receiving $4.2 million, while Illinois is receiving $20 million.

In all, 45 states and the District of Columbia participated in the agreement. The states are Alabama, Alaska, Arizona, Arkansas, California, Colorado, Connecticut, Florida, Hawaii, Idaho, Indiana, Iowa, Kansas, Kentucky, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Montana, Nebraska, Nevada, New Jersey, New Mexico, New York, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, South Dakota, Tennessee, Texas, Utah, Vermont, Virginia, Washington, West Virginia and Wisconsin.

The whistleblowers are receiving $84 million from the federal share of the recovery.

From Legal Newsline: Reach John O'Brien by e-mail at jobrienwv@gmail.com.

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