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Novartis To Pay $422.5M For Off-Label Promotion Of 6 Drugs

PHILADELPHIA -- Novartis Pharmaceuticals Corp. will pay $422.5 million in criminal and civil penalties to resolve off-label marketing allegations for six drugs, the federal government announced Sept. 30 (United States of America v. Novartis Pharmaceuticals Corporation, No. 10-cr-650, E.D. Pa.; United States of American ex rel. Jim Austin v. Novartis Pharmaceuticals Corporation, No. 03-1551, M.D. Fla., Tampa Div.; United States of America ex rel. Steve McKee v. Novartis Pharmaceuticals Corporation, No. 04-1664, E.D. Pa.; United States of America ex rel. Darryl Copeland, et al. v. Novartis Pharmaceuticals Corporation, No. 06-1630, E.D. Pa.; United States of America ex rel. Jeremy Garrity v. Novartis Pharmaceuticals Corporation, No. 08-2588, E.D. Pa.).

In a criminal case filed Sept. 30 in the U.S. District Court for the Eastern District of Pennsylvania, the Swiss drug maker agreed to plead guilty to one misdemeanor count of distribution of a misbranded drug and to pay a $170 million criminal fine and $15 million in criminal forfeiture for promoting its antiepileptic drug Trileptal for off-label uses for psychiatric disorders, pain and other uses, the government said.

Novartis also agreed to pay $237.5 million to resolve four False Claims Act lawsuits alleging off-label promotion of Trileptal and the payment of kickbacks to health care professionals to prescribe Trileptal and five other drugs:  Diovan,  Exforge and Tekturna, all hypertension drugs; Zelnorm, an irritable bowel syndrome drug; and Sandostatin, an anti-growth hormone drug.  The federal government will get $149,241,306 of that amount, and state Medicaid programs will get $88,258,694.

The qui tam relators who filed the four False Claims Act complaints between 2003 and 2008 will receive $25,675,035 from the federal share of the settlement, broken down as follows:  Jim Austin, $20,202,809; Steve McKee, $2,511,611; Darryl Copeland, $2,200,981; and Jeremy Garrity, $759,634.

In addition, Novartis entered into a five-year corporate integrity agreement with the Office of Inspector General of the Department of Health and Human Services.

Novartis said that before it was subpoenaed in the criminal investigation, it had taken steps to correct the disputed practices and to comply with government guidance.  It said it cooperated with all investigations.

In January, Novartis said it would pay a $185 million fine for off-label promotion of Trileptal.  In its 2009 sales and earnings reports, it said it had provided for a total of $397 million for the investigations.

[Editor's Note:  Full coverage will be in the Oct. 7 issue of Mealey's Emerging Drugs & Devices.  In the meantime, the documents are available at or by calling the Customer Support Department at 1-800-833-9844.  Criminal information.  Document #28-101007-034F.  Plea and sentencing brief. Document #28-101007-035X.  Settlement agreement.  Document #28-101007-036P.  Corporate Integrity Agreement.  Document #28-101007-037P.  Austin complaint.  Document #28-101007-038C.  McKee complaint.  Document #28-101007-039C.  Copeland complaint. Document #28-101007-040C.  Garrity complaint.  Document #28-101007-041C.)

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