StarBulletin.com

Hawaii awarded $1M in Eli Lilly settlement


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POSTED: Wednesday, October 08, 2008

INDIANAPOLIS » Drugmaker Eli Lilly & Co. cleared another legal cloud hanging over its top-selling drug Zyprexa when it announced a $62 million settlement yesterday, but several other storms are still brewing for the antipsychotic medication.

Hawaii was among 32 states and Washington, D.C., that Lilly agreed to pay to resolve an investigation into the company's marketing practices. Hawaii's share of the settlement is $1,016,000.

Attorneys general from several states had accused Lilly of marketing Zyprexa for off-label uses and inadequately disclosing the drug's side effects to health care providers, the same claims made in reams of other litigation against the drugmaker.

Lilly was accused of marketing the drug for pediatric care, for use at a high dose and for the treatment of dementia, according to a statement from the Indiana attorney general's office. Doctors are free to prescribe drugs for uses not approved by the FDA, but drug companies cannot market them for those situations.

The company did not admit wrongdoing in the settlement.

Yesterday's settlement will be divided among the states and the district based on population, said Greg Zoeller, Indiana's chief deputy attorney general. Indiana, for instance, will receive $1.6 million.

Lilly also agreed to several mandates that will last until 2014, well beyond Zyprexa's patent expiration in 2011. The company agreed to avoid making false, misleading or deceptive claims about the drug and not to promote it outside FDA-approved uses.

The drugmaker also agreed to give its medical staff, not the marketing staff, ultimate responsibility for approving the content in “;all medical letters and medical references regarding Zyprexa,”; according to the Indiana attorney general's statement.

However, Lilly spokesman Phil Belt said many of the items his company agreed to were things it either already did or was in the process of doing.

Lilly said it will take a related charge of 4 cents per share in the third quarter for the settlement.

The states involved in yesterday's settlement are Alabama, Arizona, California, Delaware, Florida, Hawaii, Illinois, Indiana, Iowa, Kansas, Maine, Maryland, Massachusetts, Michigan, Missouri, Nebraska, Nevada, New Jersey, New York, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Dakota, Tennessee, Texas, Vermont, Washington and Wisconsin, as well as the District of Columbia.

Zyprexa rang up $4.8 billion in sales last year. But Lilly also has settled more than 31,000 product liability claims against the drug since 2005, shelling out more than $1.1 billion in the process.

Last year, Lilly paid $15 million to settle a lawsuit with the state of Alaska in March. The drugmaker still faces litigation with 11 states.