'Bright light' helps expose problems, Texas Medicaid chief says

A trial is scheduled to start Monday in Little Rock, Ark., in which the state of Arkansas will try to prove that Johnson & Johnson's Janssen Pharmaceutica subsidiary illegally promoted the antipsychotic drug Risperdal for unapproved uses and did not sufficiently divulge negative side effects.

According to the Associated Press story, which is below, the two sides were negotiating a settlement, but talks ended Friday.

Sometimes, talks resume.

Several days after a similar trial began regarding similar allegations in Texas, J&J agreed to pay the state of Texas $158 million to stop the proceedings. The case began with whistleblower Allen Jones finding problems in Pennsylvania.

Risperdal litigation is pending in several states and the Justice Department is negotiating with J&J over federal charges.

Texas Medicaid chief Billy Millwee testified Thursday in Washington at a Senate Finance subcommittee hearing on the subject.

"When you shine a bright light on something, that's how you get it fixed," Millwee said.

Here is the AP story on the Arkansas case:

LITTLE ROCK, Ark. (AP) — A jury trial is scheduled to begin Monday over accusations that a pharmaceutical company illegally marketed an anti-psychotic medication in Arkansas.

Arkansas Attorney General Dustin McDaniel filed a lawsuit against Johnson & Johnson, claiming that its Janssen Pharmaceuticals subsidiary concealed the potential health risks of the drug Risperdal. The suit also alleges that the company promoted it for unauthorized uses in violation of Arkansas' Deceptive Trade Practices Act and the Medicaid Fraud False Claims Act.

Risperdal is used to treat schizophrenia and bipolar disorder.

If the company is found to be in violation of the law, the state could possibly see an award of about $1 billion, the Arkansas Democrat-Gazette reported on Saturday.

It's the fourth time Johnson & Johnson has gone to trial over a state's complaints about Risperdal since they first arose in 2004. The most recent trial, in Texas, ended with a $158 million settlement.

In a final appearance before Circuit Judge Tim Fox on Friday, both sides said settlement talks are over. Fletch Trammell, one of the attorneys representing Arkansas, described negotiations between both sides as "unfruitful."

Asked by the judge whether talks had concluded, Johnson & Johnson attorney Jim Simpson nodded in agreement.

Arkansas is accusing the drugmaker of risking the lives and health of thousands of residents by deliberately hiding the drug's potential to cause serious weight gain and inflict diabetes and related ailments, as well as cause circulatory problems that increase the risk of strokes.

State attorneys, in describing Risperdal as the most widely prescribed antipsychotic medication of its kind, allege that its "blockbuster success" was due in large part to the company hiding or downplaying its risks, even to the point of concealing negative results of studies.

The lawsuit also alleges that Risperdal was prescribed for purposes other than its labeled, federally approved purpose. The drugmaker promoted it for the treatment of dementia and Alzheimer's disease, according to the suit, despite testing that showed the drug increased the risk of death in elderly users.

State attorneys want the drugmaker to be fined the $10,000 maximum allowed under Arkansas law for every improper Risperdal prescription paid for using state Medicaid money.

In the original lawsuit suit filed more than four years ago, the attorney general cited 597,906 eligible prescriptions, but that number has been scaled back to 250,000 prescriptions. At the $5,000 minimum penalty required by the statute, that amounts to a potential fine of $1.25 billion.

The state originally cited 23,827 cases of questionable marketing practices under the deceptive claims act, but that was reduced last month under the limitations statute to around 20,000 instances.

Jurors will be asked to assess whether the drugmaker has any liability. The decision on fines and penalties will be up to Fox.

At least eight other states have pending Risperdal lawsuits against Johnson & Johnson, while a consortium of attorneys general is representing as many as 30 other states investigating the company for possible litigation, according to company financial disclosures released earlier this month.

Information from: Arkansas Democrat-Gazette, http://www.arkansasonline.com