OFF-LABEL PROMOTIONS WILL SUFFER DUE TO RECENT CRACKDOWN, EXPERTS SAY
The federal government's $435 million settlement with a subsidiary of Schering-Plough is part of a multiyear crackdown on off-label drug promotion that is likely to dramatically reduce such practices, various sources say.
Under the agreement, announced Aug. 29, Schering Sales, a subsidiary of Schering-Plough, will plead guilty to one count of conspiring to make false statements to the government and pay a criminal fine of $180 million. Schering-Plough will also pay $255 million to resolve civil aspects of the investigation.
At issue is the company's sales and marketing program for its drugs Temodar, for use in the treatment of brain tumors and metastases, and Intron A, for use in treatment of superficial bladder cancer and hepatitis C.
This decision personifies a push by the federal government to stamp out off-label promotion, which involves selling drugs for uses not approved by the FDA, various experts say. Preventing off-label promotion is "clearly a priority of this administration and the Justice Department," Michael Loucks, first assistant U.S. attorney for the District of Massachusetts, said. There is currently a "pharmaceutical industry wave" of enforcement occurring.
The government has increasingly relied on whistleblower actions to fight off-label promotion and fraud. Over the past five years the government has recovered $9 billion in whistleblower suits, half of the total amount recovered since the whistleblower statute was amended in 1986, he said.
Reducing this practice is significant because off-label sales make up a large percentage of industry's profits, analyst G. Steven Burrill, CEO of Burrill & Co., said. "With the cost to get a product to market exceeding $1 billion . . . shrinking the market sizes is a big threat."