Brief

AZ faces Texas lawsuit over bribery, improper marketing of antipsychotic drug

Dive Brief:

  • In a new lawsuit, Texas Attorney General Greg Abbott claims that AstraZeneca paid doctors and state mental health officials more than $460,000 to promote its antipsychotic drug Seroquel for unapproved uses.
  • Abbott alleges that the illegal marketing practices wound up costing Texas' Medicaid program millions of dollars in reimbursements for the drug, as many patients with serious mental illness are on public insurance programs. AZ denies any wrongdoing.
  • AZ previously settled a separate federal lawsuit over similar allegations regarding Seroquel marketing back in 2010. The company was forced to pay $520 million in the settlement.

Dive Insight:

“Understanding the need to obtain significant government buy-in to achieve their financial goals for Seroquel, [AZ] set [its] sights on Texas Medicaid, declaring it ‘low hanging fruit’ and ‘an absolute must win’ that would fuel brand growth,” states the lawsuit.

It's still too early to tell, but if Abbott's claims are proven to hold water, AZ could be forced to pay a big fine right around year-end earnings reporting season (or Q1 2015). In its previous Seroquel settlement with the feds, AZ had to sign a boilerplate corporate integrity agreement saying that the company would monitor and self-police unethical marketing practices. There's no word on whether or not attorneys general in other states also plan on pursuing AZ, but if the incidents that Abbott is alleging aren't just limited to Texas, the pharma giant could wind up with another federal case on its hands. 

Filed Under: Regulatory / Compliance Marketing
Top image credit: Flickr; Jeffrey Zeldman