Justice Dept. takes over Abbott probe

By Dow Jones Newswires
Posted Feb. 7 at 12:41 p.m.

The U.S. Justice Department plans to take the lead in lawsuits accusing Abbott Laboratories of illegally promoting anti-seizure drug Depakote for uses not approved by regulators, including dementia.

The Justice Department filed notices last week in federal court in western Virginia saying it would intervene in at least three lawsuits against Abbott that were previously confidential under laws designed to protect would-be whistleblowers who come forward with information about alleged health-care fraud. The lawsuits were made public as a result of the department’s intervention.

The lawsuits were filed between 2007 and 2009 by people who said they were current or former sales representatives for Abbott at the time their suits were filed.

Depakote was once one of Abbott’s top-selling drugs, with $1.6 billion in sales for 2007, before patent expirations cleared the way for sales-eroding generic competition.

The lawsuits generally allege Abbott promoted Depakote to treat conditions such as dementia in the elderly, Alzheimer’s disease and schizophrenia, which aren’t consistent with the prescribing label approved by the Food and Drug Administration. The FDA-approved uses for Depakote include treating seizure disorders, bipolar disorder and prevention of migraines.

The lawsuits allege Abbott’s promotion of such off-label uses caused false claims for prescription reimbursement to be submitted to federal health programs including Medicaid.

Drugmakers are generally barred from actively promoting off-label drug uses, though doctors have the discretion to prescribe drugs for off-label uses.

Several drugmakers, including Pfizer Inc. and Eli Lilly & Co. , have reached hefty settlements to resolve off-label marketing investigations in recent years. Whistleblower cases have factored into these settlements. Those who file whistleblower suits are eligible to receive a cut of the money, under federal law.

Abbott previously disclosed federal prosecutors were investigating its marketing of Depakote. Last year, a judge in western Virginia ordered Abbott to hand over to prosecutors some of Chief Executive Miles White’s e-mails as part of the probe. Abbott had been fighting subpoenas for the e-mails.

“The unsealing of these complaints is a routine step in the process,” said Abbott spokesman Scott Stoffel. “Because the investigation is ongoing, we do not intend to comment on the details.”

An assistant U.S. Attorney in Roanoke, Va., who filed the intervention notices, couldn’t immediately be reached.

Abbott shares fell 50 cents, or 1 percent, to $45.62 in early afternoon trading.

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