Abbot Laboratories Settles Whistleblower Lawsuit for $1.6 billion

Another billion-dollar settlement has been added to the recent string of high-profile whistleblower claims in the pharmaceutical industry. The settlement resulted from a four-year Department of Justice investigation regarding Abott's marketing of Depakote, an anti-seizure medication and mood stabilizer. The DOJ investigation revealed that Abbott illegally marketed Depakote for schizophrenia, autism and dementia, even though the Food and Drug Administration only approved the drug to treat bipolar disorders, epilepsy and migraines.

Under FDA regulations, doctors are permitted to prescribe medication for off-label uses, but pharmaceutical companies are prevented from marketing a drug for off-label uses.

Whistleblowers first accused the company of the illegal marketing in 2007. In addition to encouraging sales employees to market the drug for unapproved uses, Abbot also gave rebates to long-term care pharmacy providers who increased their use of Depakote. The marketing and rebates for off-label use encouraged nursing homes to over-proscribe Depakote to elderly patients with dementia. Abbott paid millions of dollars in kickbacks to nursing homes to increase the use of Depakote.

Abbott discontinued clinical trials of Depakote's ability to treat dementia in 1999 due to side effects such as drowsiness, dehydration and anorexia experienced by the elderly study participants. Despite this, the DOJ investigation revealed nursing homes were using the drug to subdue elderly patients with dementia. Abbot also indicated Depakote could be used to treat schizophrenia, despite little to no credible evidence it could do so.

Abbot is paying $800 million in federal and state civil cases, $700 million in criminal penalties and $100 million to states for consumer protection issues. Abbot also pled guilty to a criminal misdemeanor. Because Medicaid provided coverage for unapproved uses of Depakote, Abbot committed health care fraud against the government for its marketing practices.

Whistleblower Lawsuits

In return for filing a lawsuit alleging violations of the federal or state false claims acts, the government may award the whistleblower up to 30 percent of the settlement amount. A whistleblower is sometimes known as a qui tam plaintiff or relator.

Any employee in the pharmaceutical industry or medical field who has knowledge of fraudulent behavior against the government should contact an experienced attorney familiar with whistleblower lawsuits to discuss a potential claim.

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