Pharmaceutical Company Allergan to Pay $600 Million for Off Label Marketing of Botox

BALTIMORE, MD ( September 2, 2010) - Attorney General Douglas F. Gansler announced today that the State of Maryland joined the federal government and other states to reach an agreement in principle with pharmaceutical manufacturer, Allergan, Inc., and Allergan USA, Inc. to settle allegations of improper off-label marketing of the drug Botox. As a result, Allergan will pay the states and the federal government $225 million dollars, of which $33 million will be distributed to Medicaid programs nationwide. As a result, the Maryland Medicaid program will receive $152,547. Additionally, the Office of the United States Attorney for the Northern District of Georgia filed a one count information in the United States District Court alleging a misdemeanor violation of the Food, Drug and Cosmetic Act. In a plea agreement with the United States, Allergan agreed to enter a guilty plea and pay an additional $350 million in criminal fines and $25 million in forfeiture to resolve this Information.

Botox was initially approved to treat strabismus (crossed eyes) and blepharospasm (uncontrollable eye blinking), cervical dystonia (abnormal head and neck posture with involuntary contractions) and underarm sweating. The investigation revealed that Allergan engaged in a nationwide off-label marketing campaign of Botox targeting patients suffering from headache, pain, overactive bladder and spasticity. The marketing plan included providing physicians “free” reimbursement services and support. Allergan also funded continuing medical education programs, honoraria, and grants to health care professionals to promote off-label uses for Botox.

This settlement reimburses the federal government and participating states for excessive amounts paid by the Medicaid program as a result of Allergan’s improper off-label marketing campaign and other improper conduct. Additionally, Allergan entered into a Corporate Integrity Agreement (CIA) with the Department of Health and Human Services, Office of Inspector General, requiring strict scrutiny of its future marketing and practices.

A team from the National Association of Medicaid Fraud Control Units participated in the investigation and represented the interests of the states during negotiations with Allergan.