Allergan, the maker of Botox, agreed Wednesday to pay $600 million to settle charges that it illegally promoted and sold the drug through 2005 for unapproved uses like treating headaches.
That settlement, the latest in a continuing Justice Department crackdown on off-label drug promotion by pharmaceutical companies, comes with an unusual postscript. In recent months, the Food and Drug Administration has been weighing approving Botox for treatment of chronic migraines, a remedy that has been cited as beneficial in new studies and which was ratified last month in Britain.
The allegations of illegal marketing cover the first half of this decade, before the FDA's review.
The settlement also represents the latest in a series of high-profile deals by drug makers to resolve criminal and civil allegations, and it closely follows news that the federal government has expanded an investigation into the overseas practices of several big pharmaceutical companies involving whether officials of foreign governments received bribes.
In this case, the government's civil complaint said that Allergan had "illegally, vigorously, and without any thought to the possible negative health effects to which it subjected patients, promoted" Botox for uses that had not been deemed safe and effective by the FDA.
The company developed and put in place a wide-ranging marketing program, according to the complaint, which alleged that the program included paying kickbacks to doctors to induce them to prescribe Botox for uses - like pain and severe spasms in the limbs of children with cerebral palsy - not included in the drug's label.
Federal prosecutors also accused the company of teaching doctors how to get reimbursement from Medicare and Medicaid for off-label uses by putting in the codes for an approved treatment.
Allergan denies the kickback and fraud allegations, Caroline Van Hove, a spokeswoman for the company wrote by e-mail, calling the claims unproven civil allegations.
In the settlement, Allergan agreed to plead guilty to one criminal misdemeanor charge and to pay $375 million to the government for misbranding Botox, through promotions for unapproved uses. Additionally, Allergan has agreed to pay $225 million to resolve civil charges that it had caused false claims to be submitted to Medicare, Medicaid and other government health programs, although the company denied those allegations.
"With cases like this one, we hope to put an end to the practice in the pharmaceutical industry known as off-label marketing," Sally Quillian Yates, the U.S. attorney for the Northern District of Georgia, said in a phone interview Wednesday.
No safety net
Her office and other government agencies began investigating the company's marketing efforts in 2007 after a whistle-blower filed a lawsuit in Atlanta.
"When pharmaceutical companies ignore the FDA's approval process and market their drugs for off-label indications," she said, "they remove the safety net and assurance of efficacy provided by the FDA's rigorous review."
Once the FDA has approved a drug for a particular use, doctors are permitted to prescribe that drug for other conditions when they deem it medically appropriate. But it is illegal for pharmaceutical companies to market drugs for unapproved uses.
In a statement Wednesday, Allergan said it had agreed that its marketing between 2000 and 2005 resulted in the use of Botox for unapproved uses including the treatment of headache, pain, spasticity and juvenile cerebral palsy.
During the time period covered by the settlement, the FDA had approved Botox as a treatment for four medical conditions - crossed eyes, involuntary blinking, involuntary neck muscle contractions and excessive underarm sweating. It was also approved for the cosmetic use of smoothing vertical wrinkles between the eyebrows.
Karen Riley, a spokeswoman for the FDA, said she could not comment specifically on the agency's pending review of Botox as a potential migraine treatment.
A news release from the Justice Department issued Wednesday said that Allergan had "made it a top corporate priority to maximize sales of Botox" for unapproved uses.
The Justice Department contended that Allergan's promotions included paying doctors $1,500 each to listen to presentations on off-label uses and sending sales representatives to visit specialists who would not ordinarily administer Botox for any of the approved applications.
Medicaid paid about $76.5 million for Botox treatments between 2002 and 2006, much of it for unapproved uses of the drug, according to the government's civil complaint.
