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Wyeth to pay $491 million to resolve allegations of off-label marketing of popular transplant drug

Consumer Protection | Department of Justice | Department of Justice Press Releases | Date Posted: Thursday, August 1, 2013



Biden’s office secures $111,000 recovery for Delaware’s Medicaid Program in national settlement

Wilmington – Attorney General Beau Biden announced today that the State of Delaware, along with other states and the federal government, has reached an agreement with Wyeth Pharmaceuticals, Inc. to settle civil and criminal allegations that the company improperly promoted the sale and use of the kidney transplant drug Rapamune for uses that had not been approved by the FDA.  As a result, Wyeth will pay $491 million to resolve civil and criminal allegations, including a $60 million recovery to the Medicaid state-federal cost-sharing healthcare program.  $111,713 of that recovery will be paid to the Delaware Medicaid program.

Rapamune has been approved by the FDA for use in preventing the body from rejecting a donor kidney that has been transplanted into the body.   The investigation by the states and federal government resulted from several qui tam, or “whistleblower” cases that were filed by private individuals in federal district courts in Pennsylvania and Oklahoma under state and federal false claims statutes.  Those cases alleged that Wyeth knowingly promoted the sale and use of Rapamune for use in connection with organ transplant patients other than kidney transplant patients which were not approved by the FDA and, therefore were not covered by Medicaid, and for use in treatment regimens that had not been approved by the FDA, including for use by transplant patients who used another immunosuppressant drug before using Rapamune and who did not receive Rapamune at or around the time of a kidney transplant.

“It’s wrong to risk patient health and defraud the taxpayers by improperly marketing a drug for unapproved and potentially unsafe uses in the drive to make a profit,” Biden said.  “With this action we’ve made it clear that this conduct won’t be tolerated and we have recovered funds for the Delaware Medicaid program that will help strengthen our ability to meet our state’s healthcare needs.”

Under the national settlement, which received approval this week in federal district court in Oklahoma, Wyeth will pay the states and the federal government more than $257 million in civil damages and penalties to resolve the civil allegations of off label marketing.  Additionally, Wyeth has pled guilty in federal court in Oklahoma to violations of the U.S. Food, Drug, and Cosmetic Act and will agreed to pay more than $233 million in criminal fines and forfeitures.

In late 2009 Pfizer Inc. acquired Wyeth.  The off label marketing, and the conduct to which Wyeth pled guilty, occurred prior to Pfizer’s acquisition of Wyeth.  Pfizer cooperated fully with the federal government and the states in the investigation.  A team from the National Association of Medicaid Fraud Control Units conducted the settlement negotiations with Wyeth & Pfizer on behalf of Delaware and the other participating states.  Delaware’s participation in the investigation and settlement was facilitated through the Attorney General’s Medicaid Fraud Control Unit.

 

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Wyeth to pay $491 million to resolve allegations of off-label marketing of popular transplant drug

Consumer Protection | Department of Justice | Department of Justice Press Releases | Date Posted: Thursday, August 1, 2013



Biden’s office secures $111,000 recovery for Delaware’s Medicaid Program in national settlement

Wilmington – Attorney General Beau Biden announced today that the State of Delaware, along with other states and the federal government, has reached an agreement with Wyeth Pharmaceuticals, Inc. to settle civil and criminal allegations that the company improperly promoted the sale and use of the kidney transplant drug Rapamune for uses that had not been approved by the FDA.  As a result, Wyeth will pay $491 million to resolve civil and criminal allegations, including a $60 million recovery to the Medicaid state-federal cost-sharing healthcare program.  $111,713 of that recovery will be paid to the Delaware Medicaid program.

Rapamune has been approved by the FDA for use in preventing the body from rejecting a donor kidney that has been transplanted into the body.   The investigation by the states and federal government resulted from several qui tam, or “whistleblower” cases that were filed by private individuals in federal district courts in Pennsylvania and Oklahoma under state and federal false claims statutes.  Those cases alleged that Wyeth knowingly promoted the sale and use of Rapamune for use in connection with organ transplant patients other than kidney transplant patients which were not approved by the FDA and, therefore were not covered by Medicaid, and for use in treatment regimens that had not been approved by the FDA, including for use by transplant patients who used another immunosuppressant drug before using Rapamune and who did not receive Rapamune at or around the time of a kidney transplant.

“It’s wrong to risk patient health and defraud the taxpayers by improperly marketing a drug for unapproved and potentially unsafe uses in the drive to make a profit,” Biden said.  “With this action we’ve made it clear that this conduct won’t be tolerated and we have recovered funds for the Delaware Medicaid program that will help strengthen our ability to meet our state’s healthcare needs.”

Under the national settlement, which received approval this week in federal district court in Oklahoma, Wyeth will pay the states and the federal government more than $257 million in civil damages and penalties to resolve the civil allegations of off label marketing.  Additionally, Wyeth has pled guilty in federal court in Oklahoma to violations of the U.S. Food, Drug, and Cosmetic Act and will agreed to pay more than $233 million in criminal fines and forfeitures.

In late 2009 Pfizer Inc. acquired Wyeth.  The off label marketing, and the conduct to which Wyeth pled guilty, occurred prior to Pfizer’s acquisition of Wyeth.  Pfizer cooperated fully with the federal government and the states in the investigation.  A team from the National Association of Medicaid Fraud Control Units conducted the settlement negotiations with Wyeth & Pfizer on behalf of Delaware and the other participating states.  Delaware’s participation in the investigation and settlement was facilitated through the Attorney General’s Medicaid Fraud Control Unit.

 

# # #

 

image_printPrint

Related Topics:  , ,


Graphic that represents delaware news on a mobile phone

Keep up to date by receiving a daily digest email, around noon, of current news release posts from state agencies on news.delaware.gov.

Here you can subscribe to future news updates.