Zyprexa Maker in Talks to Settle Case for $1 Billion

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January 31st, 2008

"Makers of Zyprexa may Settle Suit"

The maker of the popular antipsychotic drug Zyprexa is in talks to settle state and federal claims over the company’s marketing practices for more than $1 billion, potentially the largest fine ever paid by a drug maker for breaking federal laws governing product promotion.

Illegal Promotion
Zyprexa has serious side effects, including severe weight gain and diabetes. The drug is only approved by the Food and Drug Administration to treat schizophrenia and severe bipolar disorder, but it is often prescribed to treat “off-label” conditions like age-related dementia.

Doctors may prescribe drugs as they see fit, even for unapproved uses. However, drug companies are not allowed to promote their products for uses other than those approved by the FDA.

Eli Lilly, the maker of Zyprexa, has been under federal investigation for illegal marketing practices since 2004, and several state attorneys general launched their own investigations shortly thereafter.

The company is accused of illegally promoting the drugs to doctors for the treatment of mild bipolar disorder and dementia in elderly patients. Lilly has profited immensely from sales of the drug, which is one of the best-selling medicines in the world.

Zyprexa Lawsuits
Even so, prescriptions of Zyprexa have dropped off in recent years as the serious nature of the side effects has come to light. The company has spent about $1.2 billion settling tens of thousands of lawsuits filed over Zyprexa’s side effects.

Lilly has been in settlement talks with federal and state authorities since last year. If approved, the money would go toward reimbursing state and federal governments for Zyprexa prescriptions filled through Medicaid and Medicare.

(Source: New York Times)

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