$600 million Botox claim settlement

$600 million settlement by Allergan, maker of Botox

Allergan, the maker of Botox, has agreed to pay $600 million to settle charges that it illegally promoted and sold the drug through 2005 for unapproved uses such as treating headaches.

This settlement is the latest in a continuing U.S. Justice Department crackdown on off-label drug promotion by pharmaceutical companies. Ironically, the Food and Drug Administration (FDA) has been seriously weighing approval of Botox for treatment of chronic migraines. This remedy has been cited as beneficial in new studies and which was ratified last month in Britain.

The charges of illegal marketing go back to 2005 and were before the FDA review. In this case, the government’s civil complaint said that Allergan had “illegally, vigorously and, without any thought to the possible negative health effects to which it subjected patients, promoted” Botox for uses that had not been deemed effective and safe by the FDA.

The civil complaint cited such disturbing practices as the company developing and putting in place a wide-ranging marketing program that included paying commissions to doctors to induce them to prescribe Botox for certain conditions. Some of these were for pain and severe spasms in the limbs of children with cerebral palsy.

The company was also accused by Federal prosecutors of teaching doctors how to get reimbursement from Medicare and Medicaid for off-label uses by putting in the codes for an approved treatment. During the time period covered by the settlement, the FDA approved Botox as a treatment for four medical conditions. These included crossed eyes, involuntary blinking, involuntary neck muscle contractions and excessive underarm sweating. It was also approved for the cosmetic use of smoothing vertical wrinkles between the eyebrows.

The settlement details include Allergan agreed to plead guilty to one criminal misdemeanor charge and to pay $375 million to the government for misbranding Botox, through promotions for unapproved uses. Also Allergan agreed to pay $225 million to resolve civil charges that it had caused false claims to be submitted to Medicare, Medicaid and other government health insurance programs. The company did deny these allegations.

Other cases have been settled in court in the last few years due to the improper sales of drugs. Last year Eli Lilly pleaded guilty to one misdemeanor charge and paid $1.41 billion to settle criminal and civil charges that it had improperly marketed an antipsychotic drug for elderly patients with dementia.

Another example is when Pfizer paid $2.3 billion to settle criminal and civil charges that it had illegally marketed the painkiller Bextra and other products. AstraZeneca agreed to pay $520 million to settle federal investigations into the marketing of Seroquel, a schizophrenia drug; in settling, the company denied charges that it had marketed the drug for unapproved uses.

This is one situation where the drug company had better carry high insurance limits or have deep pockets to dig into.

A positive side is that now all botulinum toxins must carry “black box” labels warning that the drug can spread from the injection site, with the potential to cause difficulties breathing or swallowing.

As of October 15, 2010 United States Federal health approved Botox injections for the prevention of chronic migraines in adults. The Food and Drug Administration recommended Botox be injected approximately every three months around the head and neck to dull future headache symptoms.