Allergan is the latest company to settle claims of marketing products
for non-approved use, securing an agreement over its wrinkle smoother
Botox.
The company says it has reached a resolution with the US
Department of Justice regarding a government investigation into sales
and marketing practices relating to certain therapeutic uses of Botox
(onabotulinumtoxin A). Allergan has agreed to plead guilty to a single
misdemeanour "misbranding" charge covering 2000 through 2005 and will
pay the government $375 million, acknowledging that marketing of
Botox "resulted in intended uses for the therapeutic treatment of
headache, pain, spasticity and juvenile cerebral palsy".
None of
these uses had been approved by the US Food and Drug Administration at
the time, though a number of these indications were given the thumbs-up in March
this year. Furthermore, Allergan has agreed to pay $225 million to
resolve civil claims asserted by the DOJ, claiming that a settlement is
in the best interest of its stockholders. However, the company denies
liability associated with these civil allegations "and does not believe
there is merit to them factually or legally".
As part of the deal,
Allergan has agreed to drop its own lawsuit against the FDA challenging
the agency's authority to restrict off-label uses. The company will also
enter into a corporate monitoring programme that will include publicly
detailing payments to doctors. Allergan added that it will record
non-recurring pretax charges of $610-$615 million in the third quarter
related to the settlement.
Five whistleblowers will receive $37.8
million from the federal share of the settlement. Sally Yates, US
Attorney for the Northern District of Georgia, said the FDA had approved
therapeutic uses of Botox "for only four rare conditions, yet Allergan
made it a top corporate priority to maximise sales of far more lucrative
off-label uses".
She claimed that the company also "demanded
tremendous growth in these off-label sales year after year, even when
there was little clinical evidence that these uses were effective". Ms
Yates concluded by saying that "this case demonstrates that companies
that fail to comply with the rules face criminal prosecution and stiff
penalties".
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