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Novartis to Pay $422M in Improper Off-Label Marketing Settlement

By Jason Beahm on October 01, 2010 7:16 AM

Novartis Pharmaceuticals Corporation has agreed to pay $422.5 million to settle criminal and civil investigations over antiseizure medicine Trileptal, in addition to other drugs five other drugs. The Swiss drug giant already settled another major case this year, $152 Million in a sex discrimination suit.

In this case, Novartis is pleading guilty to misdemeanor charges and accepting a $185 million fine. Novartis also paid $237.5 million over allegations that it illegally submitted claims for five additional drugs. The pharmaceutical company also signed a five-year "integrity agreement" with the inspector general at the Department of Health and Human Services.

This comes after federal prosecutors cracked down on pharmaceutical companies that have been promoting drugs for off-label uses unauthorized by the Food and Drug Administration. According to prosecutors, Novartis promoted off label marketing for Trileptal for bipolar disease as well as neuropathic pain. They specifically targeted psychiatrists and pain specialists in their marketing. It's a complex area of law because, while physicians can legally prescribe any approved drug for any purpose, the pharmaceutical companies are prohibited from marketing drugs for uses not authorized by the FDA.

Specifically, Novartis was accused of paying illegal kickbacks to heath care professionals. Novartis says that it has already cleaned up its act. Andy Wyss, president of Novartis Pharmaceuticals, said: "We are pleased to have reached resolution on this matter. N.P.C. will continue its commitment to high standards of ethical business conduct and regulatory compliance in the sale and marketing of our products," The New York Times reports.

In the meantime, it will be interesting to watch how this settlement impacts Novartis and the pharmaceutical industry. While the figure is massive, it's not as if Novartis can't afford it. Just one of their drugs, Diovan, hit $6 billion in sales last year alone.

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