Canada's Biovail Corp said it settled a criminal investigation in the USA relating to the marketing practices it indulged in when launching its hypertension treatment Cardizem LA.

Biovail is pleading guilty to charges of paying doctors in 2002 and 2003 to prescribe Cardizem LA (diltiazem) and pay a $24.6 million fine to settle the case with the US Department of Justice. The investigation relates to the firm's practice of offering doctors $1,000 to write 15 prescriptions for Cardizem LA, then complete a report on each patient to be used as part of a study.

The Ontario-based firm said that without this agreement, it was at risk of being excluded from doing business with any health programme sponsored by the US federal government and these programmes "represent a material proportion" of Biovail's operations. Chief executive Bill Wells added that the agreement with the DOJ "represents the fourth such action to be resolved in the past six months" and it eliminates "the significant exposure to the corporation related to this matter and should immediately reduce our ongoing legal expenses".

The latest deal comes five months after Biovail agreed to pay $138 million to settle a securities fraud class-action suit brought by investors who claimed the firm lied about the effectiveness of Cardizem LA when it was introduced in 2003. Also just last month, the US Securities and Exchange Commission charged the Canadian drugmaker Biovail and four of its executives with “engaging in a number of fraudulent accounting schemes and making a series of misstatements to analysts and investors”.

According to the SEC, between 2001 and 2003 senior executives at the firm “repeatedly overstated earnings and hid losses in order to deceive investors and create the appearance of achieving earnings goals” .