Earlier this month, Dutch pharmaceutical company Novo Nordisk settled eight suits, brought by the Department of Justice, claiming that the company violated the Federal Food, Drug, and Cosmetic Act (FDCA) and the False Claims Act (FCA). The DOJ asserted that the company had misbranded its popular Type II diabetes drug, Victoza, by failing to comply with an “FDA-mandated Risk Evaluation and Mitigation Strategy (REMS).” The company agreed to the settlement of $58.65M. That amount includes disgorgement (repayment of illegally-earned profits) of $12.15M for the FDCA violations, which the DOJ claimed took place from 2010 to 2012, and a $46.5M payment for the FCA violations. The latter, according to the DOJ, took place from 2010 to 2014.
Earlier this month, Dutch pharmaceutical company Novo Nordisk settled eight suits, brought by the Department of Justice, claiming that the company violated the Federal Food, Drug, and Cosmetic Act (FDCA) and the False Claims Act (FCA). The DOJ asserted that the company had misbranded its popular Type II diabetes drug, Victoza, by failing to comply with an “FDA-mandated Risk Evaluation and Mitigation Strategy (REMS).” The company agreed to the settlement of $58.65M. That amount includes disgorgement (repayment of illegally-earned profits) of $12.15M for the FDCA violations, which the DOJ claimed took place from 2010 to 2012, and a $46.5M payment for the FCA violations. The latter, according to the DOJ, took place from 2010 to 2014.
Victoza was approved in 2010, at which time the Food and Drug Administration (FDA) ordered the company to comply with a REMS to limit the possible risk that Victoza could cause Medullary Thyroid Carcinoma (MTC), a rare thyroid cancer. As part of the REMS, Novo Nordisk was supposed to give doctors information about the possible risk of MTC such that doctors and patients could then make an informed decision about using the drug. Failure to comply with a REMS equates to misbranding the drug.
The DOJ alleged that the company’s sales reps provided doctors with information that lead to the “false or misleading impression” that the Victoza warning about MTC was either incorrect or unimportant. According to the FDA, a 2011 survey revealed that roughly 50% of primary doctors had no idea of Victoza’s risk of MTC. Even after the Agency changed procedures in an effort to increase awareness, Novo Nordisk reps allegedly ignored the new procedures. One of the company’s former sales managers, a nurse, said that Novo Nordisk routinely sent sales reps pretending to be diabetes educators out to doctors’ offices where they would then illegally promote Victoza.
Following the settlement, Acting Assistant Attorney General Chad A. Readler said, “Today’s resolution demonstrates the Department of Justice’s continued commitment to ensuring that drug manufacturers comply with the law. When a drug manufacturer fails to share accurate risk information with doctors and patients, it deprives physicians of information vital to medical decision-making.”
U.S. Attorney for the District of Columbia Channing D. Phillips, echoing Mr. Readler, said, “Novo Nordisk’s actions unnecessarily put vulnerable patients at risk. We are committed to holding companies accountable for violating the integrity of the FDA’s efforts to ensure that doctors and patients have accurate information that allows them to make appropriate decisions about which drugs to use in their care. Working with the FDA and other law enforcement partners, we have sent a strong signal to the drug industry today.”
That strong signal hits Novo Nordisk right where Big Pharma companies feel it the most: its bank account. Of the $58.65M settlement, $3,320,963 will go to the Medicaid program, which is jointly funded by the federal and state governments. The balance, $43,129,026, will go to the federal government.
As most companies that agree to settlements do, Novo Nordisk issued a statement claiming it had done nothing wrong. The head of North American operations, Doug Langa, said, “While we do not agree with the U.S. government’s legal conclusions and deny any wrongdoing, we’re pleased to have negotiated a resolution that allows the company to return its full attention to developing medicines that help improve the lives of patients.” The statement continued, adding that the company is very serious about making sure safety information is properly communicated to doctors.
Victoza is Novo Nordisk’s best-selling drug. An injectable, Victoza “stimulates the natural production of insulin” in Type II diabetic patients.
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