Allergan is the latest company to settle claims of marketing productsfor non-approved use, securing an agreement over its wrinkle smootherBotox.
The company says it has reached a resolution with the USDepartment of Justice regarding a government investigation into salesand marketing practices relating to certain therapeutic uses of Botox(onabotulinumtoxin A). Allergan has agreed to plead guilty to a singlemisdemeanour "misbranding" charge covering 2000 through 2005 and willpay the government $375 million, acknowledging that marketing ofBotox "resulted in intended uses for the therapeutic treatment ofheadache, pain, spasticity and juvenile cerebral palsy".
None ofthese uses had been approved by the US Food and Drug Administration atthe time, though a number of these indications were given the thumbs-up in Marchthis year. Furthermore, Allergan has agreed to pay $225 million toresolve civil claims asserted by the DOJ, claiming that a settlement isin the best interest of its stockholders. However, the company deniesliability associated with these civil allegations "and does not believethere is merit to them factually or legally".
As part of the deal,Allergan has agreed to drop its own lawsuit against the FDA challengingthe agency's authority to restrict off-label uses. The company will alsoenter into a corporate monitoring programme that will include publiclydetailing payments to doctors. Allergan added that it will recordnon-recurring pretax charges of $610-$615 million in the third quarterrelated to the settlement.
Five whistleblowers will receive $37.8million from the federal share of the settlement. Sally Yates, USAttorney for the Northern District of Georgia, said the FDA had approvedtherapeutic uses of Botox "for only four rare conditions, yet Allerganmade it a top corporate priority to maximise sales of far more lucrativeoff-label uses".
She claimed that the company also "demandedtremendous growth in these off-label sales year after year, even whenthere was little clinical evidence that these uses were effective". MsYates concluded by saying that "this case demonstrates that companiesthat fail to comply with the rules face criminal prosecution and stiffpenalties".