Kos Pharmaceuticals, a subsidiary of Abbott Laboratories headquartered in North Chicago, Ill., has agreed to pay more than $41 million to resolve allegations involving two of its products, Advicor and Niaspan, according to a news release by the Department of Justice.
The settlement resolves allegations the Kos offered and paid physicians, physician groups, managed care organizations and other healthcare providers illegal kickbacks in the form of money, free travel, grants, honoraria and other goods and services in order to incent these individuals to prescribe or recommend Niaspan and Advicor. The accusations were first brought to light by former employees of Kos.
Additionally, the federal government accused the company of promoting the sale and use of Advicor as first-line therapy for management of mixed dyslipidemias. Such off-label use was not approved by the FDA. Under the Food, Drug and Cosmetic Act, a company is required to specify each intended use of a product in its application to the FDA. Any promotion by the manufacturer for other uses, or off-label uses, renders the product misbranded.
Under the settlement, the government will receive $33.7 million, and Medicaid will receive $4.45 million. Kos will also pay a $3.36 million criminal fine as part of the agreement. The whistleblowers will receive payments totaling more than $6.4 million from the federal share of the civil recovery.
Read the DOJ news release about the Kos Pharmaceuticals settlement.
Read other coverage about pharmaceutical company settlements:
- Kentucky Prevails in $3.5M Settlement With Pharmaceutical Company Dey
- Department of Justice Recovers $3B in False Claims Act Lawsuits in FY 2010
- 10 Largest Pharmaceutical Company Settlements in 2010
The settlement resolves allegations the Kos offered and paid physicians, physician groups, managed care organizations and other healthcare providers illegal kickbacks in the form of money, free travel, grants, honoraria and other goods and services in order to incent these individuals to prescribe or recommend Niaspan and Advicor. The accusations were first brought to light by former employees of Kos.
Additionally, the federal government accused the company of promoting the sale and use of Advicor as first-line therapy for management of mixed dyslipidemias. Such off-label use was not approved by the FDA. Under the Food, Drug and Cosmetic Act, a company is required to specify each intended use of a product in its application to the FDA. Any promotion by the manufacturer for other uses, or off-label uses, renders the product misbranded.
Under the settlement, the government will receive $33.7 million, and Medicaid will receive $4.45 million. Kos will also pay a $3.36 million criminal fine as part of the agreement. The whistleblowers will receive payments totaling more than $6.4 million from the federal share of the civil recovery.
Read the DOJ news release about the Kos Pharmaceuticals settlement.
Read other coverage about pharmaceutical company settlements:
- Kentucky Prevails in $3.5M Settlement With Pharmaceutical Company Dey
- Department of Justice Recovers $3B in False Claims Act Lawsuits in FY 2010
- 10 Largest Pharmaceutical Company Settlements in 2010