J&J to Pay $2.2B to Settle Marketing Allegations

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Despite such warnings, the company’s marketing plan targeted nursing homes and doctors who treated the elderly. Marketing materials distributed by an “ElderCare sales force” emphasized Risperdal as a treatment for seniors suffering from everything from agitation to depression to hostility. The company also downplayed the drug’s risks, including diabetes and weight gain.

At the same time the drugmaker was allegedly paying kickbacks to the nation’s largest nursing home pharmacy, Omnicare. J&J paid millions in bogus grants and education payments to persuade the company’s hundreds of pharmacists to recommend Risperdal to nursing homes. The government said the payments amounted to kickbacks.

The company also set business goals to increase drug sales to children and adolescents. Janssen instructed its sales representatives to call on child psychiatrists and to market Risperdal as a treatment for common childhood disorders, such as attention deficit disorder and autism.

Prosecutors said Monday the off-label prescribing contributed to millions of dollars of wasteful federal and state spending by health programs like Medicare, Medicaid and the Department of Veterans’ Affairs.

“Through these alleged actions, these companies lined their pockets at the expense of American taxpayers, patients and the private insurance industry,” Holder said.

In a separate civil complaint, the government alleged that J&J and its subsidiary Scios promoted its heart failure drug Natrecor as a weekly treatment for patients, despite no scientific evidence to support this approach.

J&J and Scios agreed to pay $184 million to settle civil allegations surrounding the drug.

Both state and federal governments are spending more than ever on prescription drugs, as Medicare and Medicaid swell with aging baby boomers. That increased spending has attracted scrutiny from prosecutors looking to recover taxpayer dollars.

Last year British drugmaker GlaxoSmithKline paid a record $3 billion in fines to settle criminal and civil violations involving 10 of its drugs. Prior to that, the record settlement involved Pfizer Inc., which paid $2.3 billion in criminal and civil fines.

In its most recent quarterly filing, New Brunswick, N.J.-based J&J reported $17.3 billion in cash on hand.

Johnson & Johnson shares fell 40 cents to $92.97 in trading.

(Photo: AP)

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