Corporate Law

Merck to Take Misdemeanor Plea, Play $950M for Encouraging Off-Label Vioxx Use

Without admitting wrongdoing, Merck & Co. has agreed to pay a total of $950 million and a division will plead guilty to a misdemeanor to settle criminal and civil actions over its marketing and sale of its Vioxx painkiller for off-label uses, the U.S. Department of Justice announced today.

The settlement includes a $321 million criminal penalty and a guilty plea to illegally introducing a drug into interstate commerce, concerning the pharmaceutical company’s promotion of Vioxx for rheumatoid arthritis before the Food and Drug Administration approved it for that purpose in 2002, the New York Times reports.

The company will pay an additional $426 million to the feds and $202 million to state Medicaid agencies in a civil settlement of claims that the government incurred extra health care reimbursement costs because of Merck’s illegal marketing of Vioxx.

“When a pharmaceutical company ignores FDA. rules aimed at keeping our medicines safe and effective, that company undermines the ability of health care providers to make the best medical decisions on behalf of their patients,” said assistant attorney general Tony West, who works in the DOJ’s civil division, in a written statement provided to the Times.

“We believe that Merck acted responsibly and in good faith in connection with the conduct at issue in these civil settlement agreements, including activities concerning the safety profile of Vioxx,” general counsel Bruce N. Kuhlik said in a statement provided to Bloomberg.

Vioxx, which was a big-selling drug for Merck in 2003, was approved by the FDA in 1999. It was taken off the market in 2004 amidst concerns about associated heart and stroke problems, and the company has spent billions to defend and settle patient lawsuits.

Products liability litigation is currently ongoing against the company in U.S. District Court for the Eastern District of Louisiana.

The Associated Press, Reuters and the Wall Street Journal (sub. req.) also have stories about the $950 million settlement announced today.

Related coverage: (2008): “Merck Agrees to $650M Settlement in Medicaid Health Care Fraud Case” (2008): “Vioxx Deal Goes Forward With 93 Percent Participation” (2010): “Supreme Court Allows Suit Against Merck over Vioxx Disclosures, Adopts Relaxed Deadline Rule”

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