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Abbott to pay $1.6bn in Depakote settlements

Pharma firm pleads guilty to misbranding neurologic drug

Abbott has agreed to settle lawsuits regarding the marketing of its neurologic medication Depakote in the US for $1.6bn.

The pharma firm said it had reached a settlement with US federal and 49 state authorities, plus the District of Columbia, after a four-year investigation into whether Abbott had encouraged its sales teams to market the product for conditions not approved by the US Food and Drug Administration (FDA).

As a result, Abbott has agreed to plead guilty to a violation of the Food, Drug and Cosmetic Act for misbranding, and will face charges of $800m to resolve civil allegations split among federal and state governments, $700m for a criminal penalty, and $100m to US states to resolve consumer protection matters.

Depakote is approved in the US to treat epilepsy, mania associated with bipolar disorder and to prevent migraine headaches.

However, Abbott had been accused of promoting the drug for use in elderly patients who suffered from dementia and to treat schizophrenia, despite a lack in clinical evidence that it was safe and effective to treat such conditions.

"This was an intentional, systematic marketing policy by the company, this was not the product of some rogue sales representatives who in some field office on their own went and engaged in off-label marketing," said Timothy Heaphy, US Attorney for western Virginia, as reported by Reuters.

As well as the charges, Abbott has also agreed to maintain specified compliance measures and annual certification regarding its state of compliance by its CEO and board of directors during a five-year probationary period as part of the settlement.

Laura Schumacher, executive VP for Abbot's general counsel said: “We are pleased to resolve this matter and are confident we have the programmes in place to satisfy the requirements of this settlement.”

8th May 2012

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