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Johnson & Johnson has been hit with a $1.2 billion verdict by an Arkansas judge, after a jury found the company guilty of hiding or minimizing the health risks associated with their antipsychotic Risperdal.
Arkansas Circuit Court Judge Tim Fox decided on a fine of $1.19 billion for 240,000 violations of Arkansas Medicaid fraud laws. The company was also fined $11 million for deceptive practices.
The decision is the latest in a string of losses for Johnson & Johnson as a result of lawsuits brought by various states over the drug maker’s illegal marketing of Risperdal for off-label uses and failure to adequately disclose the side effects Risperdal.
In January, Johnson & Johnson agreed to pay the Department of Justice (DOJ) more than $1 billion to settle federal claims of illegal marketing. Off-label marketing occurs when a drug company promotes the use of its drug for purposes other than those approved by the FDA, and is illegal. Doctors can prescribe a drug for any purpose they see fit, but companies cannot promote them for unapproved uses.
The DOJ has been investigating Johnson & Johnson’s marketing of Risperdal since 2004, when it began looking into an alleged kickback scheme between the drug maker and Omnicare, the nation’s largest provider of drugs to nursing homes. In 2009, Omnicare reached a settlement with DOJ over kickback charges. The DOJ investigators indicated that Johnson & Johnson paid Omnicare millions to push off-label use of Risperdal to nursing home doctors and hid the kickbacks as data fees, education fees and payments to attend Omnicare meetings. In January 2010, the DOJ filed a civil False Claims Act complaint against J&J.
Risperdal is frequently used as a “chemical restraint” in nursing homes, used to subdue unruly residents. However, studies have shown that the drug increases the risk of death in patients with dementia, and there have been nationwide efforts to curb its use for such off-label purposes.