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Novartis pays $422m to settle probe

Novartis has agreed to pay $422m to settle charges that it engaged in off-label marketing and financial kickbacks to doctors for a number of its drugs

Novartis has agreed to pay $422m in criminal and civil claims to settle charges that it engaged in off-label marketing and financial kickbacks to doctors for a number of its drugs, including the epilepsy treatment Trileptal (oxcarbazepine).

According to charges made by the US Attorney's Office for the Eastern District of Pennsylvania, Novartis created marketing materials promoting Trileptal for off-label uses, including bipolar disease and neuropathic pain, and targeted psychiatrists and pain specialists who would not normally prescribe the drug. Novartis also allegedly funded continuing medical education programmes regarding the off-label uses and offered kickbacks to doctors who wrote prescriptions. The company profited by "hundreds of millions of dollars" from these illegal activities, the US Attorney's Office claims.

The settlement deal brings to a close the US Attorney's criminal charges regarding Novartis' marketing practices for Trileptal, as well as civil charges for alleged off-label marketing of the blood-pressure medications Diovan, Exforge and Tekturna; the acromegaly treatment Sandostatin; and the irritable bowel syndrome drug Zelnorm. The investigation began with a 2005 subpoena regarding the Trileptal promotions.

Novartis will plead guilty to one misdemeanor violation of misbranding under the US Food, Drug and Cosmetic Act and pay a $185m criminal fine to resolve the Trileptal allegations and $237.5m in civil claims regarding its marketing of the five other drugs.

The settlement also includes a Corporate Integrity Agreement between Novartis and the Office of the Inspector General of the US Department of Health and Human Services. The agreement calls for five years of extra compliance-related measures, including additional monitoring, auditing, training, education, reporting and disclosures.

"Prior to receiving the subpoena, NPC had already taken steps to correct the challenged practices and comply with new government guidance," Novartis said. "NPC cooperated fully with the government throughout the course of this investigation, as well as the investigations of the five other products covered under the settlement."

1st October 2010

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