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MADISON — Attorney General J.B. Van Hollen announced today that Wisconsin has joined with other states and the federal government to reach two agreements with Abbott Laboratories to settle allegations that Abbott Laboratories illegally marketed Depakote for uses not approved by the U.S. Food and Drug Administration. The settlements resolve allegations that Abbott violated Wisconsin laws involving consumer protection and public assistance healthcare fraud. In addition, Abbott has pled guilty to federal criminal charges related to the same marketing practices.
“Consumers facing difficult health issues and healthcare assistance programs with limited taxpayer dollars should not have to worry about large pharmaceutical companies illegally promoting their products,” Attorney General Van Hollen said. “These settlements hold Abbott Laboratories accountable and will send a message to the rest of the industry.”
The agreement to resolve claims under Wisconsin's consumer protection laws marks the largest consumer protection-based pharmaceutical settlement ever reached, and includes 45 states and the District of Columbia. The nationwide consumer protection settlement totals $100 million, of which Wisconsin will receive nearly $1,855,000. The Illinois-based Abbott will be restricted from marketing the drug for off-label uses not approved by the U.S. Food and Drug Administration.
In a complaint filed today along with the settlement agreement, the states alleged that Abbott engaged in unfair and deceptive practices when it marketed Depakote for off-label uses. Depakote is approved for treatment of seizure disorders, mania associated with bipolar disorder and prophylaxis of migraines. However, the attorneys general alleged, Abbott marketed the drug for unapproved uses, including treatment of schizophrenia, agitated dementia and autism.
As a result of the states' investigation and the legal action, Abbott has agreed to significantly change how it markets Depakote and to cease promoting off-label uses.
Under the settlement, Abbott Laboratories is:
In addition, for a five-year period Abbott must:
The State of Wisconsin is represented by Assistant Attorney General Lara Sutherlin.
Public Assistance Healthcare Fraud
The public assistance health care fraud agreement is a $1.5 billion settlement that is the second largest recovery from a pharmaceutical company in a single civil and criminal global resolution. Abbott Laboratories will pay 49 states and the federal government a total of $800 million in civil damages and penalties to compensate Medicaid, Medicare, and various federal healthcare programs for harm suffered as a result of its conduct.
The states contend that from January 1998 through December 31, 2008, Abbott promoted the sale and use of Depakote for uses that were not approved by the Food and Drug Administration as safe and effective. This alleged conduct resulted in false claims to Medicaid and other federal healthcare programs.
The states also contend that Abbott Laboratories made false and misleading statements about the safety, efficacy, dosing and cost-effectiveness of Depakote for some unapproved uses; improperly marketed the product in nursing homes; and paid illegal remuneration to health care professionals and long term care pharmacy providers to induce them to promote and/or prescribe Depakote.
Medicaid is a healthcare assistance program for the needy and disabled jointly funded by the state and federal governments. Wisconsin will receive at least $4.4 million as part of the total $11.5 million attributable to Wisconsin Medicaid. Money received under this agreement is in addition to money received under the consumer protection agreement.
In addition to the civil settlement, Abbott Laboratories pled guilty this morning to a violation of the Food, Drug, and Cosmetic Act (FDCA) and agreed to pay a criminal fine and forfeiture of $700 million. Further as a condition of the settlement, Abbott Laboratories will enter into a Corporate Integrity Agreement with the United States Department of Health and Human Services, Office of the Inspector General.
This settlement is based on four qui tam or whistleblower cases, including three in which Wisconsin intervened, that were consolidated and are pending in the United States District Court for the Western District of Virginia in Abingdon, Virginia. The cases were filed under federal and state false claims statutes.
The State of Wisconsin is represented in those actions by Assistant Attorney General Tom Storm.
Documents related to the consumer protection settlement are available at the following links: