Pharmaceutical Manufacturer Novo Nordisk Inc.’s $58.65 million settlement resolving charges it failed to comply with the Federal Drug Administration (FDA)-mandated Risk Evaluation and Mitigation Strategy (REMS) for its Type II diabetes medication Victoza illustrates the potential consequences that pharmaceutical companies risk by failing to provide FDA-required warnings about potential side effects of their drugs.
The settlement announced by the Department of Justice (DOJ) on September 5, 2017 resolves a DOJ civil complaint filed September 5, 2017 charging that Novo Nordisk violated a FDA requirement in effect at the time of Victoza’s approval in 2010 that Novo Nordisk provide information regarding Victoza’s potential risk of MTC to physicians. The FDA required the notice to mitigate the potential risk in humans of a rare form of cancer called Medullary Thyroid Carcinoma (MTC) associated with the drug. DOJ charged that some Novo Nordisk sales representatives gave information to physicians that created the false or misleading impression that the Victoza REMS-required message was erroneous, irrelevant, or unimportant. The complaint also alleges that Novo Nordisk failed to comply with the REMS by creating the false or misleading impression about the Victoza REMS-required risk message that violated provisions of the FDCA and led some physicians to be unaware of the potential risks when prescribing Victoza.
According to the government’s complaint, after a survey in 2011 showed that half of primary care doctors polled were unaware of the potential risk of MTC associated with the drug, the FDA required a modification to the REMS to increase awareness of the potential risk. Rather than appropriately implementing the modification, the complaint claims that Novo Nordisk instructed its sales force to provide statements to doctors that obscured the risk information and failed to comply with the REMS modification. Novo Nordisk has agreed to disgorge $12.15 million in profits derived from its unlawful conduct in violation of the FDCA.
A manufacturer that fails to comply with the requirements of the REMS, including requirements to communicate accurate risk information, renders the drug misbranded under the FDCA.
Under the agreed settlement, Novo Nordisk will pay an additional $46.5 million to the federal government and the states to resolve claims under the FCA and state false claims acts. This portion of the settlement resolves allegations that Novo Nordisk caused the submission of false claims from 2010 to 2014 to federal health care programs for Victoza by arming its sales force with messages that could create a false or misleading impression with physicians that the Victoza REMS-required message about the potential risk of MTC associated with Victoza was erroneous, irrelevant, or unimportant and by encouraging the sale to and use of Victoza by adult patients who did not have Type II diabetes. The Food and Drug Administration (FDA) has not approved Victoza as safe and effective for use by adult patients who do not have Type II diabetes. As a result of the FCA settlement, the federal government will receive $43,129,026 and state Medicaid programs will receive $3,320,963.
The FCA settlement also resolves seven lawsuits filed under the whistleblower provision of the federal FCA, which permits private parties to file suit on behalf of the United States for false claims and share in a portion of the government’s recovery. The civil lawsuits are captioned as follows: United States, et al. ex rel. Kennedy, v. Novo A/S, et al., No. 13-cv-01529 (D.D.C.), United States, et al. ex rel. Dastous, et al. v. Novo Nordisk, No. 11-cv-01662 (D.D.C), United States, et al., ex rel. Ferrara and Kelling v Novo Nordisk, Inc., et al., No. 1:11-cv-00074 (D.D.C.), United States, et al., ex rel. Myers v. Novo Nordisk, Inc., No. 11-cv-1596 (D.D.C.), United States, et al. ex rel Stepe v. Novo Nordisk, Inc., No. 13-cv-221 (D.D.C.), United States et al. ex rel Doe, et al. v. Novo Nordisk, Inc., et al., No. 1:17-00791 (D.D.C.), and United States ex rel. Smith, et al. v. Novo Nordisk, Inc., Civ. Action No. 16-1605 (D.D.C.). The amount to be recovered by the private parties has not been determined.
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Recognized by her peers as a Martindale-Hubble “AV-Preeminent” (Top 1%) and “Top Rated Lawyer” with special recognition LexisNexis® Martindale-Hubbell® as “LEGAL LEADER™ Texas Top Rated Lawyer” in Health Care Law and Labor and Employment Law; as among the “Best Lawyers In Dallas” for her work in the fields of “Labor & Employment,” “Tax: Erisa & Employee Benefits,” “Health Care” and “Business and Commercial Law” by D Magazine, Cynthia Marcotte Stamer is a practicing attorney board certified in labor and employment law by the Texas Board of Legal Specialization and management consultant, author, public policy advocate and lecturer widely known for health industry and other management work, public policy leadership and advocacy, coaching, teachings, and publications. Ms. Stamer works with health industry and related businesses and their management, employee benefit plans, governments and other organizations deal with all aspects of human resources and workforce, internal controls and regulatory compliance, change management and other performance and operations management and compliance. For additional information about Ms. Stamer, see here, e-mail her here or telephone Ms. Stamer at (214) 452-8297.
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