Novo Nordisk coughs up $25M for off-label promotion of hemostasis drug

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Novo Nordisk, a Bagsvaerd, Denmark-based pharmaceutical maker, has agreed to pay $25 million to resolve its civil liability arising from the illegal promotion of its hemostasis management drug, NovoSeven, according to the Department of Justice (DoJ).

The FDA approved NovoSeven RT (Coagulation Factor VIIa [Recombinant] Room Temperature Stable) to treat certain bleeding disorders in hemophiliacs. The U.S. subsidiary, Novo Nordisk, located in Princeton, N.J., promoted NovoSeven to healthcare professionals for off-label uses, including as a coagulatory agent for trauma patients, general surgery, cardiac surgery, liver surgery, liver transplants and intra-cerebral hemorrhage.

As a result of this unlawful promotion, Novo Nordisk caused false claims to be submitted to government healthcare programs that were not reimbursable by those programs, the DoJ reported. Medicare and Medicaid paid for off-label prescriptions throughout the U.S. as a result of Novo’s focused campaign to influence doctors and hospitals. The federal share of the civil settlement is approximately $21.43 million, and the state Medicaid share of the civil settlement is $3.57 million.

“The off-label promotion alleged here not only wasted taxpayer dollars, but also undermined the FDA’s important role in ensuring that drugs are properly marketed to government agencies and members of the public,” said Tony West, assistant attorney general for the civil division of the DoJ.

The settlement resolves a whistleblower lawsuit filed under the qui tam or whistleblower provisions of the False Claims Act that is pending in the District of Maryland: U.S. ex rel. Black and Montiel v. Novo Nordisk. As part of today’s resolution, the whistleblowers will receive payments totaling more than $3.5 million from the federal share of the civil recovery.

“Federal law prohibits pharmaceutical manufacturers from marketing drugs for unapproved uses, and restricts them from creating a financial incentive for doctors that may conflict with the interests of their patients,” added U.S. Attorney for the District of Maryland Rod J. Rosenstein. “Drugs should be marketed only for purposes for which they have been deemed safe and effective and prescribed only because they are expected to benefit the patient.”

Also as part of the settlement, Novo Nordisk has agreed to enter into an expansive corporate integrity agreement with the Office of Inspector General of the Department of Health and Human Services (HHS). That agreement provides for procedures and reviews to be put in place to avoid and detect conduct similar to that which gave rise to this matter.

“Our separate Novo Nordisk corporate integrity agreement requires company board members to assure their compliance program is effective,” said Daniel R. Levinson, Inspector General of HHS. “This should focus high-level attention on preventing future off-label drug promotion. As an added measure, an independent review organization will provide extensive monitoring.”

The civil settlement was reached by the DoJ’s Civil Division and the U.S. Attorney’s Office for the District of Maryland.

This resolution is part of the government’s emphasis on combating healthcare fraud and another step for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced by Attorney General Eric Holder and Kathleen Sebelius, HHS secretary in May 2009.