J&J Settles Risperdal Lawsuit Over Illegal Marketing for $2.2B

Johnson & Johnson and its Janssen Pharmaceuticals subsidiary have agreed to pay $2.2 billion in criminal fines and civil liability for illegally promoting the drugs Risperdal, Invega and Natrecor.  

The announcement of the Risperdal settlement came on Monday, following an investigation by the Department of Justice (DOJ) that found the company promoted the drugs for uses that were not approved by the FDA, which is illegal, and also gave kickbacks to doctors and pharmacists who pushed the drugs for them.

Investigators say that the illegal marketing led to the unnecessary and risky use of drugs like Risperdal, which is sometimes used in nursing homes as a form of chemical restraint, often considered a form of nursing home abuse, potentially putting dementia patients’ lives at risk.

The DOJ began investigating Johnson & Johnson’s marketing of Risperdal in 2004, 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. 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. Johnson & Johnson, which also accused the drug maker of illegally promoting Risperdal for use among children prior to obtaining FDA approval for such use. Concerns have also been raised about the potential side effects of Risperdal use by children increasing the risk of childhood diabetes.

The DOJ claims the agreement is one of the largest health care fraud settlements in U.S. history, including criminal fines and forfeiture of $485 million, as well as civil settlements of $1.72 billion to be split between the U.S. government and the states.

The Justice Department also got Johnson & Johnson to sign a Corporate Integrity Agreement (CIA) with the Department of Health and Human Services Office of Inspector General (HHS-OIG). The CIA is a five-year agreement requiring the company to make major changes to the way its pharmaceutical subsidiaries conduct their business. The agreement seeks to make the company hold individual executives responsible for misconduct and to make some aspects of their pharmaceutical businesses more transparent, such as payments made to physicians. The company has to submit a detailed annual report to HHS-OIG on how it is complying with the agreement.

Company Promoted Risperdal As Chemical Restraint for Elderly

“In its plea agreement, Janssen admits that it promoted this drug to health care providers for the treatment of psychotic symptoms and associated behaviors exhibited by elderly, non-schizophrenic patients who suffered from dementia — even though the drug was approved only to treat schizophrenia,” Attorney General Eric Holder said during a press conference on Monday. “We further allege that both Johnson & Johnson and Janssen Pharmaceuticals promoted Risperdal and Invega to doctors — and to nursing homes — as a way to control behavioral disturbances in elderly dementia patients, children, and the mentally disabled.”

The DOJ says that the FDA repeatedly warned Johnson & Johnson that it would be misleading to promote Risperdal as safe and effective for the elderly and that behavioral disturbances by elderly patients may not be signs of psychotic disorders. The agency even told the company that some behavioral problems by elderly in nursing homes were likely “appropriate responses to the deplorable conditions under which some demented patients are housed, thus raising an ethical question regarding the use of an antipsychotic medication for inappropriate behavioral control.”

Holder noted that the conduct of the companies led to government health care programs paying millions of dollars in false claims to pay for drugs that were not only unnecessary, but may have been harmful to patients.

“Through these alleged actions, these companies lined their pockets at the expense of American taxpayers, patients, and the private insurance industry,” Holder said. “They drove up costs for everyone in the health care system and negatively impacted the long-term solvency of essential health care programs like Medicare.”

The company’s guilty plea must be accepted by the U.S. District Court.

This agreement follows a $327 million damage award the company has been ordered to pay South Carolina for illegally promoting the drug and overstating its benefits. Johnson & Johnson has appealed the award, arguing that the damages are unfair because it was never shown that anyone was harmed due to its actions.

South Carolina was just one of several states which have pursued lawsuits over Risperdal illegal marketing. Arkansas, Louisiana and Texas also leveled fines of hundreds of millions of dollars against the company.

Risperdal Lawsuits Over Male Breast Growth

The settlement comes as Johnson & Johnson and its Janssen subsidiary face a growing number of similar Risperdal lawsuits brought in recent years by young males who were given the drug as children, alleging that use of the antipsychotic as young boys increased the risk of developing a medical condition known as gynecomastia, which causes the breast growth in males.

The complaints allege inadequate warnings were provided for consumers or the medical community about the risk of boys developing breasts from side effects of Risperdal. In some cases, plaintiffs have alleged that boys developed breasts measuring as large as a 38D cup size after using the medication, with many cases resulting in the need for breast removal surgery.

The psychological effects of Risperdal breast growth can have a devastating impact on the boys, greatly impacting their overall quality of life. Lawsuits allege that Johnson & Johnson placed their desire for profits before the health of consumers by withholding information about this potential risk for young males prescribed Risperdal.