The Kansas Medicaid program has recovered about $4.76 million as part of nationwide settlement with the drug company AstraZeneca over alleged deceptive marketing of the anti-psychotic, Seroquel.
Attorney General Steve Six announced today that Kansas has collected its share of a $520 million agreement between the federal government, several states and AstraZeneca Pharmaceuticals LP.
The settlement stemmed from allegations that the company engaged in an illegal marketing campaign, improperly promoting off-label use of the drug.
“The Attorney General’s office is committed to investigating and prosecuting fraud and abuse of the Kansas Medicaid program,” Six said in a prepared statement. “In this case, the FDA had approved Seroquel for very specific usage, but the drug company was actively misleading doctors and consumers to use the drug in ways that were clearly unapproved. This practice put profits over patients and the settlement sends a message to pharmaceutical companies that the states expect them to play by the rules.”
Kansas will keep about $1.84 million as its share of the recovery, according to the Attorney General’s Office. The other $2.92 million will be returned to the federal government, which currently covers more than 70 percent of state Medicaid costs.
Doctors often prescribe drugs for off-label purposes, but the law prohibits drug companies from promoting uses for their drugs that are not approved by the U.S. Food and Drug Administration.
“It’s not the prescribing that’s illegal,” said Gavin Young, a spokesman for the Attorney General’s Office, “It’s the promotion.”
Young said Kansas doctors and researchers were not part of the allegations against AstraZeneca that lead to the settlement, which were national in scope.
Seroquel is one of a newer generation of antipsychotic medications (called atypical antipsychotics) used to treat certain psychological disorders, primarily schizophrenia and bipolar disorder. It is not available in generic form. The cost of a 30-tablet prescription ranges from $115 to $550, depending on the dosage.
According to Kansas Health Policy Authority statistics, the state Medicaid program spent about $10.6 million for Seroquel in the fiscal year that ended June 30. That number was drawn from the agency’s fee-for-service payment records and does not include possible payments for the drug from the program’s managed care operators. Since fiscal 2008, according to the agency, Seroquel fee-for-service costs have totaled more than $30.8 million.
From January 2001 through December 2006, AstraZeneca promoted the sale and use of Seroquel for certain uses that the FDA had not approved, according to the Attorney General’s Office.
The settlement resolves a government investigation into promotional activities by AstraZeneca that were directed not only to psychiatrists but also to primary care physicians and other health care professionals for unapproved uses in the treatment of conditions such as aggression, Alzheimer’s, anger management, anxiety, attention deficit hyperactivity disorder, dementia and sleeplessness.
As part of its marketing, AstraZeneca was also alleged to have made illegal payments to physicians, paying their way to resort locations to “advise” AstraZeneca about marketing messages for unapproved uses, for putting their names on articles written by AstraZeneca and its agents, and to conduct studies for unapproved uses of the drug.
The settlement also resolves claims that the marketing caused physicians to prescribe Seroquel for children, adolescents and dementia patients in long term care facilities, which are uses that were not medically accepted indications for which state Medicaid programs would approve reimbursement.
Kansas law prohibits the state Medicaid program from restricting prescriptions of any mental health drug for a Medicaid patient, including those given for off-label purposes.
Press spokesmen for AstraZeneca did not immediately respond to a request for comments about the settlement.