U.S. District Court Judge Samuel Wilson of the Western District of Virginia formally sentenced drug maker Abbott Laboratories (ABT: Quote) in connection with its previously announced guilty plea related to its off-label promotion of its antiseizure drug Depakote, the U.S. Justice Department said Tuesday.
Abbott was ordered to pay a criminal fine of $500 million, forfeit another $198.5 million, and pay $1.5 million to the Virginia Medicaid Fraud Control Unit. The drug maker will also be subject to a five-year term of probation.
In May, Abbott Park, Illinois-based Abbott pleaded guilty and agreed to pay a total of $1.6 billion to settle the criminal and civil claims that arose from past unlawful promotion of Depakote.
Abbott admitted that from January 1998 to December 2006 it marketed Depakote off-label to treat behavioral disturbances in dementia patients, and from January 2002 to December 2006, the company marketed Depakote off-label to treat schizophrenia, when neither of those uses was approved by the U.S. Food and Drug Administration.
In addition to the plea agreement involving its illegal promotional activity, Abbott has also entered into a civil settlement agreement under which it agreed to pay $800 million to the federal government and the states to resolve claims that its unlawful marketing and illegal remuneration practices caused false claims to be submitted to government healthcare programs.
"Abbott unlawfully targeted a vulnerable population, the elderly, through its off-label promotion. The court's sentence makes clear that those who engage in such conduct will be prosecuted and held accountable," said Timothy Heaphy, U.S. Attorney for the Western District of Virginia.
Abbott shares, which have traded in a range of $48.96 to $70.41 over the past year, closed Tuesday's regular trading session at $68.54, down 54 cents. The stock is currently gaining 57 cents or 0.83% in after hours trading.
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by RTT Staff Writer
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