Amgen Pays $762 Million in Illegal Drug Marketing Suit

Posted January 2, 2013 in Consumer Law by

Prescription pill bottle with money and pills spilling out

Don Farrall/Digital Vision/Thinkstock

Biotech giant Amgen has agreed to shell out $762 million to settle a series of lawsuits alleging that the company illegally sold and marketed anemia medication.

The lawsuits were filed by the federal government and all 50 states, accompanied by a number of whistleblower lawsuits. At the heart of the charges were allegations that the company illegally marketed its drugs for off-label purposes, and encouraged doctors to use their products by giving away free medication which health facilities could subsequently sell to patients while sending the bill to Medicare and Medicaid.

The bulk of the lawsuits revolved around the anemia drug Aranesp, which was approved by the FDA in 2001 to treat anemia for patients experiencing chronic kidney failure. In order to compete with the Johnson and Johnson product Procrit, the suits alleged, Amgen instructed its salespeople to encourage doctors to prescribe the drug for off-label use for nephrology, oncology and cancer-related anemia treatments. The sales reps distributed studies that the FDA had already discredited when the federal agency rejected approval of new uses for the drugs.

“State and federal laws prohibit pharmaceutical companies from marketing drugs for uses that have not approved by the FDA, even though doctors may write prescriptions for off-label purposes as they deem necessary,” notes personal injury attorney Howard Ankin of Ankin Law Office on his law blog.

The company pled guilty to misbranding on Dec. 18  in a federal court in New York.

The illegal activity took place for nearly six years, from September 2001 to March 2007. Five other drugs besides Aranesp were involved: Enbrel, Epogen, Neulasta, Neupogen and Sensipar. Because the misbranding involved money being spent through Medicare and Medicaid, the federal government and states had the standing to bring the lawsuits.

 

FDA Warnings

Howard Ankin

Amgen also found itself on the wrong side of at least 10 whistleblower lawsuits. “For instance, two former Amgen sales representatives alleged that they were directed by management to promote Enbrel for mild psoriasis even though it had only been approved for more severe forms of the skin condition,” Ankin writes. “Some of the whistleblower lawsuits also included allegations Amgen paid kickbacks to doctors who prescribed the drugs for off-label uses.”

In a suit filed by former sales rep Kassie Westmoreland, the plaintiff alleged that the company would overfill shipments of Aranesp so doctors could profit by billing insurers, including Medicare and Medicaid, for medication they received for free.

While Amgen managed to drum up sales by encouraging off-label use of their drugs, consumers may have actually been put at even greater risk than previously known.

The FDA issued new safety warnings in June of 2011 for Aranesp and Epogen, indicating that the medications could put patients at increased risk of heart attack, stroke or death, and cautioned doctors to tread lightly with the drugs. “We now recommend that doctors and patients should weigh the possible benefits of [erythropoiesis-stimulating agents such as the two drugs in question] to decrease the need for red-blood-cell transfusion against increased risk of serious cardiovascular events,” Robert C. Kane, MD, FDA acting deputy director for safety of hematology products, said at the time. “For each patient, doctors should individualize dosing and use only the dose sufficient to reduce the need for transfusions.”

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