$193 Million Lidoderm Settlement Announced, Whistleblowers to Be Awarded

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Three whistleblowers, among them a New York pharmaceutical sales representative, provided information to federal prosecutors, which has led to a $193 million settlement over the Lidoderm Patch being marketing for unapproved uses.

A doctor and a sales representative in Pennsylvania are the other two whistleblowers in a case brought against Lidoderm Patch maker, Endo Pharmaceuticals, said Grant C. Jaquith. Jaquith is the first assistant U.S. attorney in the Justice Department’s Albany office investigating Endo’s marketing practices, according to the TimesUnion.

Under the False Claims Act, Peggy Ryan will receive an as-of-yet undetermined share of the settlement; however, whistleblowers generally receive about 15-25 percent of the civil charges. In this case, that total will be close to about $172 million according to one of the investigators involved in the case, who also noted that Ryan continued to work for Endo after filing the lawsuit, the TimesUnion reported. Ryan began working for Endo in 2002 and filed her lawsuit in 2005.

The $173 million will be paid to U.S. state and federal authorities; the other $20 million involves criminal penalties and forfeitures in a deferred prosecution agreement, according to Reuters.

The Lidoderm Patch was approved, from 2002 to 2006, by the U.S. Food and Drug Administration (FDA) for the relief of pain tied to post-herpetic neuralgia, which is a complication of shingles, according to court documents that were filed by the U.S. Attorney’s office, according to the TimesUnion. Jaquith said that Endo intended Lidoderm to be sold for other, and unapproved, uses, such as for lower back pain, diabetic neuropathy, and carpel tunnel syndrome.

Endo received an FDA warning letter in 2005 in which the agency indicated that Endo’s marketing materials were false or misleading. The company continued to provide sales representatives with tips and techniques to discuss Lidoderm’s off-label uses with doctors, the U.S. attorney’s office indicated, the TimesUnion wrote. The U.S. Attorney’s office also argued that Endo misbranded Lidoderm because the drug’s labeling did not contain sufficient information for uses that, while intended, were not approved, according to Jaquith.

Although marketing of drugs for non-approved usage is legally banned, doctors have the freedom to prescribe medications for any purpose as they see fit.

In response to news of the settlement, New York Attorney General Eric Schneiderman said “Illegally marketing drugs off-label puts patient lives at risk,” according to Reuters. The statement indicated that New York also led a team of other states in the investigation and subsequent settlement.

As part of the settlement, Endo agreed to enter into a corporate integrity agreement with the Department of Health and Human Services (HHS) Office of Inspector General, which is meant to avoid or discover similar gaps.