Risperdal Settlement

Risperdal is one of Johnson & Johnson’s best selling medications, helping the pharmaceutical giant rake in $24.2 billion between 2003 and 2010. The atypical antipsychotic was once hailed as an effective treatment for schizophrenia, but adverse side effects and off-label uses in children and the elderly have sparked both litigation and an in-depth federal probe that recently yielded one of the country’s biggest healthcare-fraud penalties, according to the U.S. Department of Justice.

As reported by Bloomberg, Johnson & Johnson will pay a $2.2 billion Risperdal settlement to resolve criminal and civil charges that the company promoted its antipsychotic for unapproved uses and paid millions in kickbacks to nursing homes and physicians. The settlement will include $1.6 billion in civil fines to the Justice Department and numerous states involving the drugs Risperdal, Invega and Natrecor, said Attorney General Eric Holder. Under the November 4, 2013 Risperdal settlement, Janssen Pharmaceuticals – a subsidiary of J&J – will dole out $334 million in penalties and forfeit $66 million.

Reuters reports that Janssen will plead guilty to misdemeanor charges of illegally promoting Risperdal for “controlling aggression and anxiety in elderly dementia patients and treating behavioral disturbances in children and in individuals with disabilities.” The Risperdal marketing campaign, which was exposed by a whistleblower, entailed a blatant kickback scheme with Omnicare, a large pharmaceutical supplier to nursing homes.

$70 million Risperdal verdict

The fifth Risperdal gynecomastia lawsuit tried in the Philadelphia Court of Common Pleas resulted in the largest verdict thus far. On July 1, 2016, jurors hit J&J with a $70 million verdict, finding that the antipsychotic drug caused male breast growth in a Tennessee boy. Legal counsel for the plaintiff contended that J&J was well aware of gynecomastia risks, but manipulated data to downplay them. The defendant disputed allegations, claiming that physicians were fully informed of all side effects.  Following the landmark Risperdal verdict, the plaintiff’s father told Philly.com, “We hope this verdict gives hope to the thousands of other boys who were disfigured by Risperdal that they will get justice too.”

Johnson & Johnson has lost other cases in the coordinated litigation — past verdicts have included a $2.5 million award and $1.75 million verdict, won by male Risperdal patients who developed breasts. The New Jersey-based company denies any liability and wrongdoing regarding the sales and promotion of Risperdal, and plans to challenge this most recent verdict.

Given this latest series of legal defeats suffered by Johnson & Johnson, it is possible the company may initiate global settlement talks in an effort to avoid further losses. Some 1,500 Risperdal claims are still pending in Philadelphia court.

Off-label promotion of Risperdal

Risperdal is a second generation “atypical” antipsychotic originally approved by the FDA to treat patients suffering from schizophrenia. Once the FDA clears a prescription medication as safe, as it did for Risperdal in 1993, drug manufacturers are not permitted to market a drug for unapproved or “off-label” treatments – conditions that are not identified in the FDA-approved drug label.

At least 45 states across the nation claim that from 1999 through December 31, 2005, Johnson & Johnson and its Janssen unit embarked on a misleading marketing campaign, in which the manufacturers promoted Risperdal for unapproved uses in vulnerable populations, made false and inaccurate statements concerning the safety and efficacy of Risperdal, and paid illegal bribes to healthcare providers so they would increase their prescriptions of the drug to children, adolescents and seniors.

As part of the $2.2 billion Risperdal settlement that includes multiple states, New Hampshire will get $3.8 million, says Attorney General Joe Fost. New Hampshire is just one of 45 states that say unlawful Risperdal promotion resulted in thousands of fraudulent claims to be submitted with state-funded Medicaid programs.

During testimony given in a Pennsylvania state court, a former J&J employee admitted that the company promoted Risperdal in a number of illegal ways, from financing golf trips to paying doctors to give positive speeches about the drug, and even went so far as to “butter up doctors” with bags of Risperdal Popcorn.

Risperdal settlement over health fraud

The U.S. Department of Justice issued a press release on November 4, 2013, explaining the allegations and ramifications involved in the settlement.

“This multibillion-dollar resolution demonstrates the Justice Department’s firm commitment to preventing and combating all forms of health care fraud. And it proves our determination to hold accountable any corporation that breaks the law and enriches its bottom line at the expense of the American people,” said Attorney General Eric Holder.

Risperdal manufacturer Johnson & Johnson “recklessly put at risk the health of some of the most vulnerable members of our society — including young children, the elderly, and the disabled,” Holder told Bloomberg News.

Despite knowledge of harmful Risperdal side effects in elderly populations, including a heightened risk of strokes, Janssen promoted the medication as safe for geriatric patients.

Illegal promotion to nursing homes

Omnicare was accused by the Department of Justice in 2010 of accepting millions of dollars in kickbacks – disguised as administrative fees – from J&J to promote Risperdal among elderly patients suffering from dementia. J&J and Janssen created a specialized ElderCare sales force that promoted Risperdal to assisted living care facilities, claiming the drug could help control aggression and other behavioral disturbances in dementia patients.

Risperdal has since been linked to 37 incidents of stroke or stroke-like events in senior patients undergoing treatment for dementia. At least 16 of these patients died as an alleged result of being treated with Risperdal for an off-label purpose. While Janssen pled guilty to a single misdemeanor violation of the Food, Drug and Cosmetic Act for past promotional practices of Risperdal, the company admits no liability or wrongdoing and denies all allegations cited in the government’s civil action.

Bloomberg added that as part of the Risperdal settlement, J&J was ordered to sign a five-year “corporate integrity agreement” with the Department of Health and Human Services.  The accord, however, will not resolve charges brought by state attorneys general in Arkansas, South Carolina and Louisiana, where J&J purportedly employed deceptive Risperdal marketing practices and misrepresented the risks and side effects of the drug in an effort to boost product sales.

Compensation for Risperdal misbranding

Though the antipsychotic wasn’t approved for use in children until 2006, Janssen sales reps began pushing the drug to child psychiatrists much earlier, even though research suggested that Risperdal exposure could increase levels of prolactin – the hormone that stimulates male breast growth or gynecomastia.

According to the government’s suit, Risperdal was prescribed for the following unapproved uses in children and adolescents: as a treatment for attention deficit hyperactivity disorder, oppositional defiant disorder, obsessive-compulsive disorder, and autism. The U.S. Department of Justice had been investigating J&J’s questionable sales practices since 2004 before reaching the landmark $2.2 billion settlement.

Resources Resources