Qui Tam Whistleblower Off-label Pharma Suits on the Rise

Washington, DCPharmaceutical and medical device companies are likely rethinking their fraudulent marketing plans, thanks to a number of successful qui tam off-label lawsuits that have cost pharma companies billions of dollars and reaped substantial awards for whistleblowers.

Off-label use of a drug or device is a use other than that for which the product was approved by the Food and Drug Administration (FDA). Although physicians widely employ off-label uses, the agency's policy is that an unapproved use violates the Food, Drug and Cosmetic Act (FDCA), and off-label promotion violates the FDCA.

Savvy marketers take advantage of the fact that the FDA doesn't regulate doctors, usually by misleading and pressuring doctors—and giving them financial incentives and kickbacks—to prescribe drugs and medical devices for unapproved uses, which naturally increases profits for pharma companies.

Just to make things more confusing, the FDA says on its website: "FDA recognizes that the public health can be served when health care professionals receive truthful and non-misleading scientific and medical information on unapproved uses of approved or cleared medical products."

However, it immediately qualifies this with: "if a manufacturer engages in other conduct that unlawfully promotes an unapproved use of a medical product -- whether or not the manufacturer also engages in conduct in conformance with the recommendations in this guidance -- such other conduct may result in enforcement action."

Pharma marketers employ a number of techniques to lure physicians into prescribing their drugs for off-label use such as:

• Making sales calls on physicians with practices who have patients for whom the drug is not yet approved, such as peddling to pediatricians a drug not yet found to be safe and effective in children;


• Talking physicians into developing a protocol for use of the drug in a non-indicated manner;


• Distributing non-peer reviewed clinical studies of questionable scientific value that support the off-label use; and,


• Asserting in oral or written communications that the use is advisable, desirable, or recommended.

These practices could pose a serious health risk to the patient. A physician who receives false or misleading information from pharmaceutical sales reps could prescribe a drug that proves to be harmful. Some examples:

Pfizer/Warner-Lambert settled for $704 million for off-label promotion of the AIDS-wasting drug Serostin. The company was also charged with financially inducing doctors to prescribe the drug off-label (an all-expense paid trip to a medical conference in Cannes), and false representations to patients and health professionals regarding the medical necessity of the drug.

Pfizer Inc. also paid $1.8 billion to settle off-label marketing of Bextra.

Cell Therapeutics settled $10.5 million to resolve claims based on its off-label promotion of Trisenox, an oncology drug paid for by Medicare. The company was charged with sham consulting agreements to corrupt independent medical decision making, and false statements to physicians regarding the efficacy and regulatory approval of the off-label use.

Medicis Pharmaceutical paid $9.8 million to resolve claims based on its off-label promotion of the topical skin cream Loprox for use by children.

Eli Lilly paid $1.4 billion to settle investigations into illegal marketing of its antipsychotic drug Zyprexa.

April 2010 was a busy month for qui tam lawsuits:

Schwarz Pharma Inc. was charged with marketing two unapproved drugs, Deponit and Hyoscyamine Sulfate Extended Release and it will pay $22 million to settle. Two whistleblowers will receive $1,836,575 from the federal share and additional amounts from the state share.

AstraZeneca completed a deal to pay $520 million for paying kickbacks to doctors as part of an illegal scheme to market drugs for unapproved uses to children, the elderly, veterans and prisoners.

The US Justice Department said AstraZeneca, Johnson & Johnson agreed to pay more than $81 million to resolve criminal and civil claims over illegal promotion of the epilepsy drug Topamax.

Ortho-McNeil Pharmaceutical will pay $75.37 million to resolve civil allegations that it illegally marketed Topamax and caused false claims to be submitted to government health programs. The company promoted the drug for unapproved psychiatric uses.

In May 2010 AstraZeneca, Johnson & Johnson, Topamax, Ortho-McNeil Pharmaceutical Novartis Vaccines & Diagnostics Inc. and Novartis Pharmaceuticals Corporation agreed to pay $72.5 million from the marketing of the cystic fibrosis drug TOBI: Novartis caused false claims to be submitted to federal health care programs for certain off-label uses of the drug.

And there are more cases just beginning to reach trial.

"Pharmaceutical companies must not promote their drugs for uses that have not been proven to be safe and effective," said Tony West, Assistant Attorney General for the Civil Division of the Department of Justice. "We are committed to pursuing False Claims Act violations and recovering taxpayer dollars lost to off-label marketing."

Because the government has raked in huge settlements from pharmaceutical companies due to the qui tam provisions of the False Claims Act (FCA), it encourages whistleblowers to use qui tam regarding off-label promotion. In fact, the government has about 150 pharmaceutical fraud cases pending, involving more than 500 drugs. A lot of money is at stake for the feds: prescription drugs account for about 10 percent of all health care expenditures in the US.

From 2001 to 2006, almost $3.9 billion was recovered from drug manufacturers directly as the result of cases brought by whistleblowers and it is predicted that litigation against the pharmaceutical industry will increase as Medicare spending increases.