“There are very few companies that haven’t had their turn in the wheelhouse to get a spanking,” according to a quote in the article by Ira Loss, an independent analyst who follows the pharmaceutical industry. “I tend to think the pressure put on these salesmen to hit targets and goals leads to misbehavior.”

Off-label marketing allows pharma companies to increase profit from their best-selling products. This illegal shortcut is alluring because the companies don’t invest in further FDA approvals. Pfizer generated $10 billion in about five years selling its seizure drug Neurontin for unapproved uses.

Doctors may prescribe medicines for unapproved uses, but pharma companies cross the line when their reps sell physicians on the idea of using drugs for off-label purposes, sometimes with inducements and misrepresentations.

These violations of the False Claims Act will continue, one expert said, as long as drug companies make more on off-label promoting than they lose in fines. But big financial penalties and the threat of having medicines taken off Medicare, Medicaid and other formularies could make the risk too great.

Frank Palumbo, executive director of the University of Maryland School of Pharmacy Center on Drug and Public Policy, said in the article: “I think companies are on notice at this point to make sure they’re in compliance. Adopting a corporate integrity agreement puts a company on notice that they need to be more proactive about their sales reps are doing.”

For more information about qui tam law and pharmaceutical fraud, contact Nolan and Auerbach, PA.

For more information about qui tam law and pharmaceutical fraud, contact Nolan and Auerbach, PA.

According to the FBI’s press release, the allegations are that all the defendants participated in an illegal, off-label marketing scheme to promote medical devices used during invasive surgeries. In particular, the defendants are alleged to have promoted devices used to stimulate bone growth in long bones and the spine, which have highly restrictive FDA approval, for off-label, more widespread uses.

For the full press release, go to: http://boston.fbi.gov/dojpressrel/pressrel09/bs102809.htm.

For more information about qui tam law and health care fraud, contact Nolan and Auerbach, PA.

In December, Grassley wrote to Wyeth and DesignWrite, a medical education and communications company, regarding allegations that Wyeth hired DesignWrite to draft articles promoting the company’s hormone therapy products and seek academic investigators to sign on as the primary authors. Previously, Grassley had written to Merck and Scientific Therapeutics Information, a medical publishing company, regarding similar allegations reported in the Journal of the American Medical Association related to articles on Merck’s VIOXX studies.

He sent the letter on July 1 to the American Journal of Medicine, the Annals of Internal Medicine, the Annual Review of Medicine, the Archives of Internal Medicine, Nature Medicine, PLoS Medicine, The Journal of the American Medical Association and The New England Journal of Medicine. Grassley asked for the editors’ written responses by July 22, 2009.

For the full press release, go to: http://finance.senate.gov/press/Gpress/2009/prg070209.pdf.

For more information about qui tam law and health care fraud, contact Nolan and Auerbach, PA.

The government’s investigation of the pharmaceutical fraud began as the result of a whistleblower lawsuit under the False Claims Act by a former sales representative for Orphan. Orphan engaged in a scheme to expand the market for Xyrum by marketing and promoting the drug to physicians for “off-label” use which included using a psychiatrist in promotional speaking engagements. The psychiatrist with the approval of Orphan sales personnel also showed physicians how to obtain reimbursement from Medicare and Medicaid for these unapproved uses. The criminal prosecution arose out of a criminal misbranding scheme by which physicians would write presciptions for Xyrum that were not reimburseable for Medicare and Medicaid.

“Pharmaceuticals manufactured under strict standards can still injure or kill if used for unapproved purposes. Here, the risk was not from willful abuse by users; it was from a concerted campaign by the manufacturer to push a drug for off-label uses. This posed a serious health risk and constitutes a serious crime,” said FBI Assistant Director-in-Charge, New York Field Office, Mark J. Mershon.
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To read more click here or more about pharmaceutical fraud at Nolan & Auerbach.

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