Off-label Marketing: Elan Fined USD 203 Million

• Date: December 29, 2010
• Source: Admin

Zonegran is an FDA approved anti-epileptic drug, manufactured by the Irish company, Elan Corporation PLC. However, Elan and its U.S subsidiary promoted Zonegran for a variety of improper uses, including mood stabilization, migraine headaches, eating disorders and weight loss. It amounted to illegal promotion of the drug.  The Justice Department slapped a fine of USD 203 million plus on Elan Corporation PLC and its U.S. subsidiary under the False Claims Act. The Japanese drug marketer Eisai Inc., which bought the drug from Elan, will pay USD 11 million for off-label marketing of Zonegran.

Elan has consented to plead guilty and pay a criminal fine of USD 97 million and an additional USD 102.3 million to resolve civil allegations. It will forfeit assets worth USD 3.6 million too. The settlement demonstrates the government's determination to curb health care frauds by invoking the False Claims Act. The Justice Department claims to have recovered USD 5 billion plus since January 2009 in cases involving fraud against federal health care programs alone.

Regulations

The False Claims Act (31 U.S.C. § 3729–3733, also called the "Lincoln Law") is an American federal law that allows civilians to file complaints against federal contractors for filing fraudulent claims against the government. The act of filing such complaints is informally called "whistleblowing." Individuals filing under the Act stand to receive a portion (usually 15 to 25%) of any recovered damages. The Act provides a legal tool to counteract fraudulent billings turned in to the federal government. Claims under the law have been filed by persons with insider knowledge of false claims involving health care, military, or other government spending programs. The government has recovered nearly USD 22 billion under the False Claims Act between 1987 and 2008.

Source:  

http://www.pharmpro.com/news/2010/12/business-Elan-to-Pay-203M-Off-Label-Marketing-Fine/

http://en.wikipedia.org/wiki/False_Claims_Act