J&J Sued by Texas in Whistleblower Case Over Drug Marketing

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J & J Sued by Texas in Whistleblower Case Over Drug Marketing

By Rob Waters

Dec. 28 (Bloomberg) -- A & unit misled Texas health officials

about the risks of an antipsychotic drug to increase prescriptions, according to

a whistleblower lawsuit joined by the state attorney general.

The suit claims that J & J's Janssen Pharmaceutica unit caused Texas to overspend

on Risperdal, the world's second-best-selling schizophrenia drug last year. The

case is one of several against makers of antipsychotics and stems from Texas

prescribing guidelines directing state-funded doctors to give priority to newer,

more expensive drugs.

The guidelines and deceptive marketing techniques boosted sales of Risperdal,

raising costs for Texas and endangering patients, according to the complaint,

which was secret until it was unsealed Dec. 15. The state is seeking unspecified

damages. Risperdal sales were $10 billion in the U.S. from 2001 through 2005,

according to IMS Health Inc.

``This is a case about sales and marketing trumping medical science,'' said

Melsheimer, an attorney for the original plaintiff, in a Dec. 19 phone

interview. ``The basic allegation is that Janssen promoted Risperdal use not for

sound medical reasons but for economic reasons.''

Tom Kelley, a spokesman for Texas Attorney General Greg Abbott, declined

yesterday to comment on the case.

& , the maker of thousands of health-care products from Band-Aids

to heart devices, does ``not promote our products for off-label use,'' said

Ambre Morley, a spokeswoman for the New Brunswick, New Jersey-based company, in

an interview this week. J & J doesn't comment on litigation, she said.

Texas Law

The complaint was initiated in 2004 by , a former Pennsylvania state

investigator. Under Texas law, whistleblower suits are dismissed unless the

attorney general joins them. may collect 15 to 25 percent of any payments

by J & J, Melsheimer said.

Lawsuits across the U.S. accuse drug companies of engaging in deceptive

marketing by overstating the effectiveness and understating the risks of newer

antipsychotics. The suits also claim companies promoted the drugs for unapproved

uses.

Mississippi, Louisiana, Alaska and West Virginia sued Eli Lilly & Co. this year

on behalf of their Medicaid health programs for the poor, saying the company

fraudulently touted the antipsychotic Zyprexa for unapproved uses.

Indianapolis-based Lilly settled about 8,000 personal-injury complaints for $700

million in 2005 and faces 4,000 more claims.

Lilly spokesman Phil Belt said yesterday that Lilly is ``committed to being

transparent about the risks of Zyprexa.'' He declined to comment on specific

cases.

Zyprexa was the world's top-selling schizophrenia drug with $4.2 billion in

revenue last year. Risperdal was second with $3.6 billion.

AstraZeneca

London-based AstraZeneca Plc, the maker of the third-best- selling

antipsychotic, Seroquel, stands accused in more than 200 federal and state

lawsuits of concealing the diabetes risk faced by users. AstraZeneca is

``vigorously defending'' the cases, said spokesman Jim Minnick in an e-mailed

statement. Sales rose 36 percent last year to $2.8 billion.

The Texas complaint says the health department received as much as $6 million in

contributions from Janssen and other parties to implement treatment guidelines

under the Texas Medication Algorithm Project, known as TMAP. The guidelines were

then exported to other states through training programs.

The largest contributors, according to the lawsuit, were Janssen Pharmaceutica

and the Wood Foundation, a charity endowed by the co-founder of

J & J.

The Princeton, New Jersey-based foundation provided three grants totaling $2.8

million to evaluate TMAP as part of an effort ``to improve treatment of chronic

disease,'' said spokesman Morse, in a phone interview this week.

Standardize Treatment

The Texas program began in 1996 as a way to standardize prescribing of

medication to state mental patients, led by Shon, then medical director

for behavioral health for the Texas health department, and University of Texas

academics.

Shon resigned effective Oct. 31 at the request of Bell, acting health

department commissioner, said Ted , a spokesman for the Texas Health and

Human Services Commission. Bell requested the resignation after being briefed on

the suit by the attorney general's office, said.

Shon also consulted for Janssen, an arrangement the department was unaware of

and wouldn't have approved, said. Shon didn't respond to requests for

comment left on his home telephone answering machine.

`Significant Increase'

After the guidelines were adopted, Janssen ``experienced a significant increase

in sales of Risperdal'' in Texas and worked to bring the program to other

states, the suit alleges. State officials ``traveled extensively, at the expense

of defendants, to tout the wonders of the new drugs,'' the complaint says.

Janssen ``improperly influenced state decision-makers with trips, perks, travel

expenses, honoraria,'' and paid state officials ``to speak in their official

capacities'' to promote the drugs, the complaint says.

One of the first states to adopt prescribing guidelines was Pennsylvania. ,

the whistleblower who filed the suit, was an investigator for Pennsylvania's

Office of the Inspector General in burg. Assigned to look into payments

made to state agencies and employees, he interviewed Janssen officials, the

complaint says.

says he was blocked by his superiors from investigating company marketing

practices and was fired when he continued to do so and leaked information to

reporters.

The case is Texas v. Janssen LP, No. GV-401288 in County District Court,

Austin.

To contact the reporter on this story: Rob Waters in San Francisco at

rwaters5@... .

Last Updated: December 28, 2006 10:10 EST

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