Arkansas to collect $2.4 million in drug case

Abbott Laboratories has agreed to a $1.6 billion settlement with the U.S. Department of Justice that will send $2.6 million to Arkansas’ Medicaid Trust Fund, according to a statement from Attorney General Dustin McDaniel.

The settlements with Abbott Laboratories over allegations of illegal off-label marketing of its drug Depakote.

The company will pay $800 million to resolve civil allegations split among federal and state governments, $700 million for a criminal penalty, the Justice Department said in a statement. Abbott marketed the drug, approved for epilepsy, bipolar mania and migraine prevention, for unapproved uses including dementia, the U.S. said.

The settlement results from a four-year-old investigation into Abbott sales practices that began in 1998, the Abbott Park, Ill.-based company said.

Abbott said it is also paying $100 million to the states to resolve consumer protection matters.

“Not only did Abbott engage in off-label promotion, but it targeted elderly dementia patients and downplayed the risks apparent from its own clinical studies,” Acting Associate Attorney General Tony West said in the DOJ statement. “As this criminal and civil resolution demonstrates, those who put profits ahead of patients will pay a hefty price.”

Federal regulators only approved Depakote for the prevention of migraines, treating acute manic episodes in bipolar patients and halting seizures in adults and children.

Under U.S. law, a doctor can prescribe a medicine for any condition as long as it’s licensed by the U.S. Food and Drug Administration and is proven to be safe and effective. Drug companies aren’t allowed to promote a drug for uses other than those approved.

“We are holding Abbott Laboratories responsible for wrongfully marketing Depakote for uses not approved by the U.S. Food and Drug Administration,” McDaniel said in his statement. “Actions like these have a detrimental effect on our state’s Medicaid program. I applaud the states and federal government for working together to reach this settlement.”

The settlement also covers allegations that Abbott paid kickbacks to health-care professionals and long-term care pharmacy providers to induce them to promote or prescribe Depakote.

“This is a terrific result for the public,” said Reuben Guttman, a Washington-based lawyer representing some of the whistle-blowers who sued Abbott. “This is one of the largest drug settlements of false-claim allegations in history.”

As a result of the investigation, Abbott has agreed to change how it markets Depakote and to cease promoting off-label uses. The changes include:
• Prohibited from making false or misleading claims about Depakote;
• Prohibited from promoting Depakote for off-label uses; and,
• Required to ensure financial incentives on sales do not promote off-label uses of Depakote.