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MADISON — Attorney General J.B. Van Hollen announced today that Wisconsin joined the federal government and other states to reach an agreement with pharmaceutical manufacturer, Allergan, Inc., and Allergan USA, Inc., to settle allegations of improper off-label marketing of the drug Botox. The agreement was reached in principle last fall, and today Wisconsin Medicaid received settlement proceeds in the amount of $563,456.12, as the state share of the $1,273,937.50 attributable to Wisconsin Medicaid, the remainder of which goes to the federal government.
Van Hollen noted that Medicaid is a health care program jointly funded by the federal and state governments to provide assistance to needy residents. “We strive to protect the resources of the Medicaid program, both for taxpayers and for those in genuine need. Resolutions like this go a long way toward protection of the integrity of the program,” he said.
The settlement called for Allergan to pay the states and the federal government a total $225 million dollars, of which $33 million dollars was for Medicaid nationwide. The other components of the comprehensive settlement were to resolve Medicare and other federal health program claims. Additionally, the Office of the United States Attorney for the Northern District of Georgia filed a one count information in the United States District Court alleging a misdemeanor violation of the Food, Drug and Cosmetic Act. In a plea agreement with the United States, Allergan agreed to enter a guilty plea and pay an additional $350 million dollars in criminal fines and $25 million in forfeiture to resolve this information.
The national federal and state settlement totaling $600 million dollars resolved allegations that Allergan promoted the drug Botox for uses other than what the Food and Drug Administration approved. Botox was initially approved for strabismus (crossed eyes) and blepharospasm (uncontrollable eye blinking), cervical dystonia (abnormal head and neck posture with involuntary contractions) and underarm sweating.
The investigation revealed that Allergan engaged in a nation-wide off-label marketing campaign of Botox targeting patients suffering from headache, pain, overactive bladder and spasticity. The marketing plan included providing physicians “free” reimbursement services and support which included coaching physicians to use a muscle spasm code in order to obtain reimbursement for this off-label use. Allergan also funded continuing medical education programs, honoraria, and grants to health care professionals to promote off-label uses for Botox.
This settlement reimbursed the federal government and participating states for excessive amounts paid by the Medicaid program as a result of Allergan's improper off-label marketing campaign and other improper conduct. Additionally, Allergan entered into a Corporate Integrity Agreement (CIA) with the Department of Health and Human Services, Office of Inspector General, requiring strict scrutiny of its future marketing and practices.