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Johnson & Johnson $2.2 Billion Settlement Just a Slap on the Wrist

Fines are just another cost of doing business in an out-of-control pharmaceutical industry.
 
 
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When profit is the name of the game, why let teenage boys growing breasts or elderly nursing home patients suffering strokes stand in the way?

On Monday, the U.S. Department of Justice announced that pharmaceutical giant Johnson & Johnson agreed to pay out $2.2 billion to settle civil and criminal complaints related to illegal marketing of the antipsychotic drug Risperdal, among other products.

The $2.2 billion figure seems large at first glance. However, compared to the money that the company made off of the drug, it’s just another cost of doing business in an out-of-control pharmaceutical industry hell-bent on bringing in massive profits no matter the consequences for the patients who take the drugs.

According to the allegations, J&J subsidiary Janssen promoted Risperdal between 1999 and 2005 to treat teenagers, mentally disabled patients and elderly people suffering from dementia despite the fact that it had only gained FDA approval to treat schizophrenia in adults during that time. The company also paid kickbacks to doctors and pharmacists for prescribing the drug and downplayed or covered up evidence of its most serious side effects, according to the DOJ complaint.

While it’s not illegal for doctors to prescribe medicine for off-label uses, it is against the law for manufacturers to market their products for symptoms or illnesses for which they haven’t been approved by the FDA. Risperdal was no benign medication, either. Among the side effects it is known to cause are intestinal issues, sexual problems, anxiety, aggression, diabetes, strokes and breast growth. Some young adult males had to have mastectomies after they were improperly prescribed the antipsychotic.

The latest settlement is at least the 15th J&J has made with states or the federal government since 1991, and the 10th since 2010. The company is still facing hundreds of Risperdal-related personal injury lawsuits as well as waiting on appeals of hundreds of millions more in fines in several individual states.

“This is just another example of how pharmaceutical companies continue to run amok,” said Brian J. McCormick Jr., an attorney in Philadelphia handling many of the civil lawsuits for consumers harmed by Risperdal. There were about 490 in total.

“If they can make $25 or $30 billion over the life of a drug and pay a $2 billion fine 10 years later, that’s a pretty good investment,” he said.

According to the criminal complaint, Risperdal brought in $9 billion between 1999 and 2005. Subsequently, sales only went up—the drug netted some $24 billion between 2003 and 2010, according to Public Citizen.

“I think one could conclude that Johnson & Johnson made out very well,” said Bonnie Patten, executive director of the nonprofit Truth in Advertising.

“It seems that it is very economically advantageous for these pharmaceutical companies to market drugs for off-label uses,” Patten said, citing similar settlements by Wyeth and Amgen earlier this year. “Even after fines are taken into consideration they’re still pocketing billions and billions of dollars for these marketing practices.”

Indeed, Johnson & Johnson stock barely budged even after this week’s announcement, and has risen more than 50 percent over the last five years despite the near constant civil and criminal payouts.

The company acknowledged its criminal culpability while continuing to deny civil liability even while agreeing to the settlement. As part of the deal, J&J had to enter into a corporate integrity agreement to clean up its act. The company was already under an agreement for an entirely different illegal marketing settlement for an epilepsy drug called Topamax.

The big pharma poster child could hardly claim ignorance of its actions. Included in the evidence the government brought were repeated warnings by the FDA to not market Risperdal for the elderly, particularly those suffering from dementia. Nevertheless, J&J admitted that it specifically promoted it to healthcare providers to treat behavioral disturbances in older patients.