Merck, Sharp & Dohme will shell out $950 million to settle criminal charges and civil charges related to illegally misbranding its painkiller rofecoxib (Vioxx). Merck pled guilty to one count—that it violated the Food Drug and Cosmetic Act for misbranding Vioxx and downplayed the potential health risks.

According to the Department of Justice (DoJ), part of the plea agreement will entail Merck forking over nearly $322 million in criminal fines for illegal promotional activity of the drug. On top of it, Merck will enter a civil settlement agreement where the company will pay nearly $628 million to resolve additional allegations regarding the off-label marketing of Vioxx and false statements about the drug’s possible risks.

The agreement will close the longstanding investigation of the promotion of Merck’s Vioxx, according to DoJ.

Vioxx was pulled from the shelves in 2004 after a clinical trial found that the drug could be linked to a greater risk of adverse events or death from cardiovascular (CV) conditions or blood clots. In fact, it was noted that patients taking Vioxx had a 35 percent increase in the risk of CV events or death. FDA ordered that the drug be removed from the shelves after Vioxx was linked to nearly 27,000 heart attacks or sudden cardiac deaths between 1999 and 2003.

In May 2008, Merck paid $58 million to 29 states and Washington, D.C., to settle civil allegations under the state consumer protection laws for playing down the health risks of the drug in company advertisements. “The settlement resolves allegations that Merck representatives made inaccurate, unsupported, or misleading statements about Vioxx’s cardiovascular safety in order to increase sales of the drug, resulting in payments by the federal government,” DoJ said in a statement.

Additionally, the DoJ said that the criminal plea agreement relates to the misbranding of Vioxx by promoting the drug for treating rheumatoid arthritis, even before it was approved by FDA. While FDA approved the use of the drug for three indications, rheumatoid arthritis was not one of them.

“When a pharmaceutical company ignores FDA rules aimed at keeping our medicines safe and effective, that company undermines the ability of healthcare providers to make the best medical decisions on behalf of their patients,” Tony West, assistant attorney general for the Civil Division of the Department of Justice, said. “As this plea agreement and civil settlement make clear, we will not hesitate to pursue those who skirt the proper drug approval process and make misleading statements about the safety and efficacy of their products.”

Lastly, as part of the settlement agreement, Merck has agreed to enter a corporate integrity agreement with the Office of Inspector General of the Department of Health and Human Services, which will help to strengthen the system of reviews and oversight procedures by the company.