Vol 22, 2013 Annals of Health Law 430
PROSECUTIONS OF PHARMACEUTICAL COMPANIES
Allergan and the government began in 2000, and in the fall of 2010, a
global settlement was reached, with Allergan agreeing to pay $600 million
and agreeing to dismiss its challenge to the constitutionality of the FDA
regulations.160
An intense battle still rages in the case of Purdue Pharma executives
who were personally excluded from participation in federal health programs
for twelve years after Purdue pled guilty to misdemeanor off-label
promotion of the pain medication OxyContin and paid $600 million in
monetary sanctions.161 In that case and in many others, the government
theory is that if a company markets for an off-label purpose, then it
“causes” a prescriber to file a false claim for reimbursement with Medicare,
Medicaid, and other federal health care programs. This causal link is not
proved or tested, because the cases settle in the main. But often, the
government has evidence of a pattern of marketing by the drug
representatives, accompanied by very substantial increases in the sales of
the drug. This evidence, although circumstantial, is in some cases very
powerful. In the case of OxyContin, a settlement was reached with the
company, and certain officers entered into the misdemeanor pleas along
with the company.162 The Secretary of Health and Human Services
excluded the officers from participation in federal health care programs for
twelve years, a substantial and unexplained departure from prior
precedent.163 On appeal, the Court of Appeals for the D. C. Circuit held that
the exclusion of the corporate officers was warranted on the basis of their
misdemeanor misbranding convictions, but reversed and remanded the case
because the Secretary of Health and Human Services’ decision as to the
length of the exclusion imposed was arbitrary and capricious.164 It is widely
believed that recently the government has increased its intensity and focus
on the pharmaceutical company executives who allegedly enable the
challenged marketing conduct, even if they do not actively engage in the
conduct. Under the responsible corporate officer doctrine, this is enough
for the government to pursue exclusion.
In these off-label promotion cases, it might be difficult to find
individual doctors who will testify that the reason they prescribed a
medication is because the drug representative told them it was safe and
160. Press Release, Allergan, Allergan Resolves United States Government
Investigation of Past Sales and Marketing Practices Relating to Certain Therapeutic Uses of
BOTOX (Sept. 1, 2010), available at http://agn.client.shareholder.com/releasedetail.cfm?
ReleaseID=503974; see also Osborn, supra note 22, at 339.
161. Friedman v. Sebelius, 755 F. Supp. 2d 98 (D.D. C. 2010).
162. Friedman v. Sebelius, No. 11-5028, 2012 WL 3055520, at *1 (D. C. Cir. July 27,
2012).
163. Id. at *2.
