Md. To Receive $6.5 Million from Eli Lilly Settlement

BALTIMORE (Jan. 16, 2009) - Attorney General Douglas F. Gansler announced today that Maryland has joined with other states and the federal government and reached an agreement in principle with Eli Lilly and Company to settle allegations it engaged in an off-label marketing campaign that improperly promoted the anti-psychotic drug, Zyprexa. Eli Lilly will pay the states and the federal government a total of $800 million in damages and penalties to compensate Medicaid and various federal healthcare programs for harm suffered as a result of this conduct. Maryland will receive over $6,500,000 from the settlement. In addition, the United States Attorney for the Eastern District of Pennsylvania has filed a criminal Information in United States District Court charging Eli Lilly with a misdemeanor violation of the Food, Drug and Cosmetic Act. In a plea agreement filed with the Court, Eli Lilly has agreed to pay a $615 million criminal fine to resolve the charge. The total amount to be paid by Lilly in the civil and criminal agreements is $1.415 billion, which is the largest recovery in a health care fraud investigation in U. S. history.

Zyprexa is one of a newer generation of antipsychotic medications (called atypical antipsychotics) used to treat certain psychological disorders. Between September 1999 through and December 2005, Eli Lilly willfully promoted the sale and use of Zyprexa, primarily through a marketing campaign called “Viva Zyprexa,” for certain uses which the Food and Drug Administration had not approved. The promotional activities undertaken by Eli Lilly in the “Viva Zyprexa” campaign promoted Zyprexa not only to psychiatrists, but also to primary care physicians for such unapproved uses as the treatment of depression, anxiety, irritability, disrupted sleep, nausea and gambling addiction. In implementing the campaign, Eli Lilly also provided remuneration and other things of value to physicians and other health care professionals. As a result of these promotional activities, Eli Lilly caused physicians to prescribe Zyprexa for children and adolescents, dementia patients in long term care facilities, and in unapproved dosage amounts, all of which are uses that were not medically accepted indications for which state Medicaid programs would approve reimbursement.

As part of the settlement, Eli Lilly will enter a Corporate Integrity Agreement with the United States Department of Health and Human Services, Office of the Inspector General which will closely monitor the company’s future marketing and sales practices.

This settlement is based on four qui tam cases that were filed or consolidated in the United States District Court for the Eastern District of Pennsylvania by various relators - private parties that filed actions under state and federal false claims statutes.

A National Association of Medicaid Fraud Control Units team participated in the investigation and conducted the settlement negotiations with Eli Lilly on behalf of the settling states. Team members included representatives from Massachusetts, New York, Ohio, Delaware, New Jersey, Texas and Illinois.

Source: Md. Attorney General Douglas F. Gansler

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