Posted on Thursday, 29th April 2010 by Emily Smith
WASHINGTON – AstraZeneca and AstraZeneca Pharmaceuticals will pay $520 million to resolve allegations that the anti-psychotic drug Seroquel was marketed illegally for uses not approved as safe and effective by the Food and Drug Administration.
Such unapproved uses are also known as “off-label” uses because they are not included in the drug’s FDA approved product label. It is alleged that AstraZeneca illegally marketed Seroquel between January 2001 through December 2006, promoting it to psychiatrists and other physicians.
The Wilmington, Del.-based company signed a civil settlement to resolve allegations that by marketing Seroquel for unapproved uses, the company caused false claims for payment to be submitted to federal insurance programs including Medicaid, Medicare TRICARE, and to the Department of Veterans Affairs, Federal Employee Health Benefits Program and Bureau of Prisons.
“Illegal acts by pharmaceutical companies and false claims against Medicare and Medicaid can put the public health at risk, corrupt medical decisions by healthcare providers, and take billions of dollars directly out of taxpayers’ pockets,” said Attorney General Eric Holder.
According to the FDA, departments of Justice and Health and Human Services’ Healthcare Fraud Enforcement Action Team (HEAT), the federal government will receive $301,907,007 from the civil settlement, and the state Medicaid programs and the District of Columbia will share up to $218,092,993. The allegations were originally brought in a lawsuit under the qui tam or whistleblower provisions of the False Claims Act and various state False Claims Act statutes.
Under the Food, Drug and Cosmetic Act, a company must specify the intended uses of a product in its new drug application to the FDA. Before approving a drug, the FDA must determine that the drug is safe and effective for the use proposed by the company. Once approved, the drug may not be marketed or promoted for off-label uses.
The United States also contends that AstraZeneca violated the federal Anti-Kickback Statute by offering and paying illegal remuneration to doctors it recruited to serve as authors of articles written by AstraZeneca and its agents about the unapproved uses of Seroquel. AstraZeneca also illegally paid doctors to travel to resort locations to “advise” AstraZeneca about marketing messages for unapproved uses of Seroquel, and paid doctors to give promotional lectures to other healthcare professionals about unapproved and unaccepted uses of Seroquel.
As part of the settlement, AstraZeneca has entered into a Corporate Integrity Agreement, which allows a board of directors committee to annually review the company’s compliance program and certify its effectiveness. Other measures include: that certain managers annually certify that their departments or functional areas are compliant, that AstraZeneca send doctors a letter notifying them about the settlement, and that the company post on its website information about payments to doctors, such as honoraria, travel or lodging.
Similar Posts:
- Brooklyn neurologist pleads guilty in healthcare fraud scheme
- Premier takes first step in creating accountable care organizations
- Feds targeting doctors who miscode Medicare Part B place of service
- Healthcare Reform May End Up Discouraging Hiring
- Buying Individual Health Insurance Reduces Medical Costs
Tags: Giant Pay, Pay
Posted in Financing FAQ | No Comments »