Company Maintained Specialized Sales Force to Market Drug for Off Label Purposes; Targeted Elderly Dementia Patients in Nursing Homes
Global Health Care Company Abbott Laboratories Inc. has pleaded guilty and agreed to pay $1.5 billion to resolve its criminal and civil liability arising from the company’s unlawful promotion of the prescription drug Depakote for uses not approved as safe and effective by the Food and Drug Administration (FDA), the Justice Department announced today. The resolution – the second largest payment by a drug company – includes a criminal fine and forfeiture totaling $700 million and civil settlements with the federal government and the states totaling $800 million. Abbott also will be subject to court-supervised probation and reporting obligations for Abbott’s CEO and Board of Directors.
“Today’s settlement shows further evidence of our deep commitment to public health and our determination to hold accountable those who commit fraud,” said James M. Cole, Deputy Attorney General. “We are resolute in stopping this type of activity and today’s settlement sends a strong message to other companies.”
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The FDA is responsible for approving drugs as safe and effective for specified uses. Under the Food, Drug and Cosmetic Act (FDCA), a company in its application to the FDA must specify each intended use of a drug. A company’s promotional activities must be limited to only the intended uses that FDA approved. In fact, promotion by the manufacturer for other uses – known as “off-label” uses – renders the product misbranded.