-Bloomberg

08/21/2009 - Eli Lilly & Co. will pay $22.5 million to settle a lawsuit brought by the state of West Virginia claiming the company improperly marketed its antipsychotic drug Zyprexa.

Zyprexa, Lilly’s best-selling drug, has been the subject of federal and state investigations into whether the company marketed the drug, approved for schizophrenia and bipolar disorder, for unapproved, or off-label, uses. Lilly resolved a marketing investigation in January with the U.S. Justice Department, promising to pay $1.42 billion, including about $362 million to more than 30 states.

Lilly will pay $15.75 million to West Virginia and $6.75 million to lawyers representing the state, according to a court filing unsealed today. The West Virginia suit was one of a dozen state claims pending against the company seeking reimbursement for funds spent on Medicaid, the government’s health program for the poor. Lilly announced July 22 that it would take a pretax charge of $102 million this quarter for settling “several” state lawsuits over Zyprexa.

“We think that putting the issue behind us is not only in the best interest of Lilly but in that of patients, caregivers and health care professionals,” Marni Lemons, a Lilly spokeswoman, said today.

Doug Davis, an assistant attorney general in West Virginia, said he couldn’t immediately comment on the settlement.

‘Good Result’

The settlement is “a good result for the state,” said attorney Blair Hahn of Richardson, Patrick, Westbrook & Brickman in Mt. Pleasant, South Carolina, which represents West Virginia in the lawsuit.

“It’s many multiples more than the state would have received in the consolidated settlement,” he said in an interview today. A state of West Virginia’s size would have received about $1.5 million in the earlier settlement, he said.

U.S. District Judge Jack Weinstein in Brooklyn last week urged states to settle their marketing claims against Lilly over Zyprexa. Weinstein is overseeing all federal-court lawsuits over the drug.

“A global settlement of all cases, including those pending in state courts is desirable,” Weinstein said in an Aug. 17 decision.

The West Virginia agreement calls for Lilly to pay $14.75 million to be used to fund behavioral mental health services and $1 million for consumer protection purposes in the state. Lilly didn’t admit any wrongdoing in settling the lawsuit.

For six years, Lilly’s medical letters and references for Zyprexa can’t be developed by Lilly’s marketing or sales personnel, according to the terms of the settlement.

No Promotion

During that time, Lilly also must disclose its Zyprexa grant information at the Lilly Grant Office Registry Web site. Grants can’t promote Zyprexa, and sales and marketing staff can’t initiate, coordinate or implement grants, nor can they select grant recipients, according to the settlement filed in federal court in Brooklyn, New York.

Additionally, Lilly must provide to the attorney general, in spreadsheet format, a list of promotional speakers paid more than $100 for speaking or consulting. Lilly sales representatives can only provide samples to doctors whose practices are consistent with current labeling; now, Lilly gives samples of Zyprexa to doctors in emergency medicine, general practice, family practice, internal medicine and psychiatry, according to the filing.

Lilly should report clinical trials accurately in its promotional materials, according to the settlement. The company won’t present favorable information from trials inadequate to support the conclusion, fail to reveal variations around average results or use misleading retrospective statistical analyses, according to the document.

More Lawsuits

Lilly continues to face lawsuits by Connecticut, Louisiana, Pennsylvania, South Carolina and seven other states alleging that the company withheld information about the side effects of Zyprexa, such as diabetes, and encouraged sales of the drug for unapproved purposes, including dementia and depression.

Doctors can prescribe medicines for any use. Drugmakers can’t promote those medicines for any use not approved by the U.S. Food and Drug Administration. The states are seeking damages and fines for violation of laws against deceptive practices and false claims.

Lilly is scheduled to begin trial Sept. 14 in South Carolina over that state’s Zyprexa lawsuit. The only trial of a state’s lawsuit ended in March 2008 with an out-of-court settlement in which Lilly agreed to pay Alaska $15 million.

Zyprexa, part of a class of medications called atypical antipsychotics, has been linked to excessive weight gain and diabetes. The lawsuits also claim Lilly failed to properly warn of Zyprexa’s side effects.

Lilly also agreed in October to pay a total of $62 million to 32 states and the District of Columbia to settle consumer protection claims over improper marketing.

The West Virginia case is part of In re: Zyprexa Products Liability Litigation, 04-MD-1596, U.S. District Court, Eastern District of New York ( Brooklyn).

If you or a loved one have experienced Zyprexa side effects you may be entitled to compensation. Contact the Zyprexa attorneys of Ennis & Ennis today for a free confidential case evaluation. Our on staff nurse and lawyers are standing by to answer any questions you may have regarding Zyprexa side effects, a possible Zyprexa class action lawsuit, or any other type of Zyprexa litigation.