South Carolina v. Janssen Pharmaceutica (Spartanburg, South Carolina).

South Carolina prevailed today on its Risperdal overcharge claim when a jury found that Johnson & Johnson’s Janssen Pharmaceutica misled consumers in its marketing for the antipsychotic Risperdal (risperidone). Louisiana last October prevailed on a similar claim and was awarded $257M; however, Johnson & Johnson won a Risperdal challenge in Pennsylvania. Texas’ Risperdal overcharge claim will be tried in June 2011.

With hundreds of millions in civil penalties potentially at stake, South Carolina sent attorney John Simmons of the Simmons Law Firm to make the closing argument.  Mr. Simmons told the jury, “As far back as 1994 the FDA told these guys you can’t make comparative claims [against first-generation atypical antipsychotics] outside of the label…They knew…You can’t bury studies. You can’t hide information…Yet you’ve got their own executives saying [in emails shown to the jury], ‘That’s what happened here.‘…The label is only as fair and truthful as the company and the people writing it.“

“We’re talking about a powerful drug going into the bodies of children in South Carolina, not even four years of age,” Mr. Simmons told the jury. “Is it important for drug companies to tell the truth? Absolutely…If this had happened twenty years ago, a lot of this we wouldn’t have had a record of. Because these are people communicating [by] talking; there’s nothing there. You now are able to see with your own eyes what actually happened, and what was said, largely because of the preservation of the electronic mail here. Digital footprints.“

For the defense, Richardson & Plowden’s Steven Pugh characterized the state’s case as a “smoke screen,” and pointed out that millions of people had been helped by Risperdal. According to Mr. Pugh, Risperdal had been prescribed millions of times, “not because of some spin, not because of some way to make a bunch of money, not because of hidden data — they were prescribed Risperdal because, as the FDA has told us six times, it’s safe and effective. It works! Doctors saw that. They exercise their clinical judgment and decide what drug they are going to prescribe for their patient…The State doesn’t claim that Risperdol isn’t good medicince, and the State doesn’t claim that Risperdol has harmed anyone in South Carolina.”

“I submit to you ladies and gentlemen that unproven allegations of potential harm to the elderly and children has nothing to do with this case…The case is about two things: A letter, November 10, 2003, and the FDA-approved insert for Risperdal. The State has failed to prove that either is a violation of the South Carolina Unfair Trade Practices Act.”

In his closing rebuttal on behalf of the State, John B. White, Jr., of Harrison, White, Smith & Coggins told the jury, “We started out this case with ‘Thou shalt not lie.’ Maybe we should have said, ‘Don’t sell your soul for the almighty dollar…Corporate ethics is an issue that’s current. It’s affected our nation and South Carolina for the last 3-4 years. That’s what we’re talking about in this case. It’s not science — it’s corporate ethics…It’s about what Janssen knew, and didn’t tell.”

The jury found that Janssen Pharmaceutica made willful misstatements on both the Dear Doctor Letter and the label/package insert.

The amount of civil penalties to be imposed will be determined by the Court.

CVN webcast the South Carolina Risperdal overcharge trial live.

South Carolina v. Janssen Pharmaceutica (Spartanburg, South Carolina).

South Carolina’s Attorney General sued Janssen Pharmaceutica and its parent pharmaceutical company, Johnson & Johnson, to recover damages and civil penalties for alleged fraud and overcharges in the marketing and sale of the psychiatric medication Risperdal (risperidone).

For the plaintiff, Don Coggins, of Harrison, White, Smith, & Coggins, told the jury, “When these drugs are prescribed correctly — when doctors have full and fair information, and they can weigh the risks and benefits of these drugs against the side effects — these drugs are good drugs. The people who are severely mentally ill need these drugs, and there’s no problem with that. But ladies and gentlemen, with respect to the side effects that these drugs have, the evidence is going to show that Johson & Johnson, that Janssen Pharmaceutica, was not honest, and did not give full and fair information.“

Mr. Coggins reviewed for the jury statements that allegedly mischaracterized the risks associated with Risperdal, and a warning letter from the FDA stating that a Risperdal “Dear Healthcare Provider” letter was “false or misleading” under federal law.

According to Mr. Coggins, Johnson & Johnson also claimed that Risperdal had fewer side effects than competing drugs, even though they had evidence at the time showing that Risperdal’s side effects were as serious. Mr. Coggins also reviewed emails from when Johnson & Johnson “got caught” by the FDA, which suggested that Janssen was willful and intentional about what they did.

Mr. Coggins urged the jury to disregard any objections from Johnson & Johnson that no physicians were in fact deceived by any misstatements, because the plaintiff’s burden in an enforcement case was only to show bad-behavior, not reliance.

For the defense, Steve Pugh, of Richardson Plowden, pointed out to the jury that South Carolina’s complaint essentially revolved around an FDA-approved package insert or label, and a November 10, 2003 letter, which allegedly failed to properly disclose certain risks — risks of weight gain, diabetes, hyperprolactinemia. However, said Mr. Pugh, “those side effects have been in the Risperdal FDA-approved package insert from Day One.”

“Those side effects, those issues, those known risks…the state says they are in the wrong place! Ladies and gentlement…those side effects are in the label,” said Mr. Pugh, “where the FDA says they’re going to be. That’s the FDA’s decision. They tell us what our label is.”

Because the label was meant for doctors, said Mr. Pugh, the lack of  evidence that any doctor was misled by the allegedly false communication, suggested that the what Janssen communicated was not in fact misleading.

The jury in the trial will be asked to rule only on liability, not damages; damages would be awarded by the Court in a subsequent proceeding. However, a subsequent damage award by the Court could potentially exceed $1B.

CVN is webcasting the South Carolina v. Johnson & Johnson Risperdal trial live.

South Carolina v. Janssen Pharmaceutica, scheduled to begin February 14 in Spartanburg, South Carolina, will be the third jury trial involving claims that Johnson & Johnson overcharged for its antipsychotic drug Risperdal (generically known as “Risperdone”). South Carolina’s alleged Medicaid overcharge damages are said to run into the billions.

Pennslyvania asserted a simlar claim, but the case was dismissed in June, 2010, after the state had presented its evidence to a jury. But in Louisiana a jury awarded $257M against Johnson & Johnson last October, and in 2009 a West Virginia judge awarded $4.4M in damages. Several other states’ Risperdal claims are still pending, including Arkansas, Montana, New Mexico, Texas, and Utah.

In its complaint, South Carolina conceded that it had no practical means of ensuring that every Risperdal prescription was medically necessary, and “thus relies on persons receiving payment and benefits to turn square corners in their dealings with Medicaid” and state reimbursement programs. However, Janssen Pharmaceutica had “aggressively exploited this loophole” (1) by promoting Risperdal for non-medically acceptable and non-medically necessary uses, and (2) by falsely representing to the State that Risperdal was safer and more effective than less expensive first-generation antipsychotics. In addition, South Carolina sought to recover the cost of treating South Carolina citizens who were injured by inadequately disclosed Risperdal risks.

Risperdal was introduced by Janssen in 1994, and by 2005 generated annual revenues in excess of $3.5B. “Crucial to this blockbuster success,” said South Carolina, was Janssen’s “aggressive marketing of Risperdal, which consisted chiefly of overstating the drug’s efficacy, while concealing its life-threatening effects.“

CVN will webcast the South Carolina Risperdal Overcharge Trial live.