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Lilly to set aside
$1.42B to settle Federal Medicaid Fraud
Charges related to Zyprexa
[Oct 22, 2008]
Eli Lilly on Tuesday said it will
set aside $1.42 billion to settle federal
charges of improperly marketing its
schizophrenia drug Zyprexa, the Wall Street
Journal reports.
The firm said it is in "advanced
discussions" on an agreement with the U.S.
attorney's office in Philadelphia that would
settle the case and eliminate the
possibility of criminal charges against the
company (Rockoff,
Wall Street Journal,
10/22).
The
U.S. attorney's office in 2004 began
investigating allegations that Lilly
marketed the drug to unapproved patients and
that it downplayed the side effects,
including weight gain and an increased risk
of diabetes.
The Medicaid fraud control agencies of more
than 30 states have cooperated in the
federal investigation (Reuters/New
York Times, 10/22).
Lilly earlier this month agreed to pay $62
million to 33 states to settle allegations
that the company marketed Zyprexa for
unapproved uses in violation of state
consumer protection laws.
According
to the allegations, internal documents and
e-mails indicate that Lilly marketed Zyprexa,
which
FDA has approved as a treatment
for schizophrenia and mania associated with
bipolar disorder in adults, as a treatment
for dementia and milder forms of bipolar
disorder (Kaiser
Daily Health Policy Report,
10/7).
States alleged that that the misuse of
Zyprexa forced their Medicaid programs to
spend large amounts of money treating such
adverse effects.
Eleven
states that have filed suits against Lilly
are not participating in the federal
investigation (Reuters/New York Times,
10/22).
Previously, Lilly reached agreements to pay
a total of $1.2 billion to about 31,000
individual plaintiffs (Wall
Street Journal,
10/22).
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