1. The U.S. Department of Justice announced a settlement with Johnson and Johnson where the corporation will pay a $2.2 billion settlement related to deceptive marketing and distribution of prescription drugs. The drugs were mostly given to children, adolescents, and seniors, and Johnson and Johnson deceived on what the drugs should be allowed for, and paid off doctors and agencies to make sure their drugs were prescribed.
The cases, which date from the late 1990s through the early 2000s, involve alleged kickbacks to doctors and pharmacies to promote the antipsychotic drugs Risperdal and Invega, and a heart drug, Natrecor. The widely anticipated agreement was one of the largest health-care fraud settlements in U.S. history.In addition to overly-expansive proscribing of the pills, there were reports of awful side effects, including ,a href="http://www.forbes.com/sites/edsilverman/2012/01/20/after-the-risperdal-trial-jj-looks-more-like-humpty-dumpty/"> studies that pointed to an increased risk of diabetes (with courtroom testimony indicating J&J buried those studies from the public), and numerous alleged instances of young boys growing breasts after taking the drugs. It appears to be a flagrant example of late '90s and 2000s corporate greed overtaking any semblance of responsible administration of drugs, and a lack of caring about who was damaged as long as the monthly quotas were hit.
Federal investigators accused a Johnson & Johnson subsidiary of promoting Risperdal for controlling anxiety and aggression in elderly dementia patients, as well as for treating behavioral problems in other “vulnerable” populations, such as children and the mentally disabled, even though the Food and Drug Administration initially approved the drug only for schizophrenia. Officials said the company also promoted off-label uses for Invega and “made false and misleading statements about its safety and efficacy.”
Locally, Wisconsin is one of many states that will join in the settlement, as the state's DOJ announced today. According to today's release, $24 million will go back to the state's Medicaid program, which will help to pay the extra bills we have due to Gov. Walker's decision to turn down Obamacare funding.
2. And the Medicaid program received funds as part of another settlement with drug companies doing seamy items. McKesson and First Data bank ran through an elaborate, years-long scheme where they inflating pill prices, ripping off the state's taxpayers in the process. You can read about the whole deception here, with the scam starting in Summer 2001, and continuing through much of the 2000s. With this settlement, the state gets its money back from McKesson's Bush-era scam, and First Data's negligence (or worse, cooperation) in allowing it to go through.
Under the terms of the settlement agreement, McKesson has paid the State $13,916,115.60 and First DataBank has provided the State $276,881.25 in credits for its services. The McKesson settlement payment included $11,596,763 in restitution to Wisconsin Medicaid and $2,319,352.60 for attorneys’ fees and costs.Combined with the first settlement, that looks like $37 million into the Medicaid program, which might go a long way toward closing the $52 million gap in Medicaid that is projected. Won't do much good for the future years, but at least it might keep even more severe cuts from happening.
In Wisconsin, it is unlawful for any person or company to make representations that are untrue, misleading or deceptive with respect to the sale of pharmaceuticals. McKesson reported false, fraudulent and inflated average wholesale prices to First DataBank, Inc., who in turn published this false information, causing the Wisconsin Medicaid program to overpay for the drugs it purchased.
This type of corporate fraud was a major part of the "freedom" of what Tea Baggers were calling the "greatest health care system in the world" 3-4 years ago. As Tom Tomorrow brings up in "This Modern World", it's what you get when you have a health care system run by Dr. Hand.