Breaking News
FONT-SIZE Plus   Neg
Share SHARE

J&J Penalized $1.1 Bln. In Risperdal Malpractices Case

RELATED NEWS
Trade JNJ now with 

An Arkansas Court Wednesday slapped a fine of more than $1.1 billion on Johnson & Johnson (JNJ: Quote), after it was found guilty of using dubious means to push its schizophrenia drug Risperdal in the state.

The fine is related to a 2007 lawsuit whereby J&J and its Janssen unit were charged with misleading Medicaid officials in Arkansas into believing that Risperdal was better compared to rival drugs. J&J was also alleged to have inflated the cost of Risperdal thereby causing undue loss to Arkansas Medicaid insurance program.

J&J was also charged for failing to disclose exact information about potential risks of Risperdal, including increased blood sugar and diabetes. The company was also found guilty of marketing the drug for unapproved uses in children and adults. The FDA had cleared the drug for treatment of adult schizophrenic patients only.

The Arkansas trial spanned two weeks and was held in Pulaski County Circuit Court in Little Rock. State Judge Tim Fox announced the over $1.1 billion penalty Wednesday.

Fox's judgment was on the premise that J&J committed about 238,000 violations of state Medicaid fraud laws by using questionable means to sell Risperdal for about four years from 2002. Judge Fox penalized J&J with $5,000 for each violation.

J&J meanwhile has denied all of the charges.

This is not the first time that J&J is being handed out penalties. The company in January said it would pay $158 million to settle a Texas suit accusing it of illegally marketing Risperdal to patients. Similar suits are pending in other states as well.

The company was earlier asked to shell out $327 million in a South Carolina case and $258 million in Louisiana, where appeals are on in both cases.

J&J has also agreed in principle to plead guilty to a misdemeanor violation of a federal law in connection with a U.S. Justice department-led investigation of its Risperdal selling practices. The company is reported to be in talks to settle civil allegations in connection with the case.

The Justice department has been over the years probing these charges. Investigations go way back to 2004 when Attorney General Abbott and whistleblower Allen Jones had sued Janssen. Jones unearthed evidence during his work as an investigator in the Pennsylvania Office of Inspector General.

JNJ is trading at $64.13, down $0.07 or 0.11%, on the NYSE. In after hours, the stock dropped 0.05%.

Register
To receive FREE breaking news email alerts for Johnson & Johnson and others in your portfolio

by RTT Staff Writer

For comments and feedback: editorial@rttnews.com

Business News

Editors Pick
Apple Inc. said Tuesday after the markets closed that its third quarter profit rose 12% from last year, as sales surged and margins improved amid strong sales of its iPhones and Mac computers. The company's quarterly earnings per share also came in above analysts' expectations, but its quarterly sales fell short of analysts' forecast. United Nations Secretary-General Ban Ki-moon on Tuesday urged both Israelis and Palestinians to stop the fighting that has been raging for the past two weeks in the Gaza Strip, and pleaded with the two sides to return to dialogue with the aim of addressing the underlying causes of the repeated cycles... After moving notably higher in early trading on Tuesday, stocks continued to perform well throughout the session. The gains on the day offset the modest weakness that was seen in the previous session, extending the recent back-and-forth movement by the markets.
comments powered by Disqus
FREE Newsletters, Analysis & Alerts

 

Stay informed with our FREE daily Newsletters and real-time breaking News Alerts. Sign up to receive the latest information on business news, health, technology, biotech, market analysis, currency trading and more.