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R.I. to receive $2.3M in Abbott Lab fraud settlement

BLOOMBERG FILE PHOTO/TIM BOYLE
RHODE ISLAND will receive more than $2.3 million as part of a $1.5 billion health care fraud settlement with Abbott Laboratories.
Posted 5/7/12

PROVIDENCE – Rhode Island will receive more than $2.3 million as part of a $1.5 billion health care fraud settlement with Abbott Park, Ill.-based Abbott Laboratories over the illegal off-label marketing of an anti-seizure drug.

The drug, Depakote, is an anti-seizure and mood-stabilizing drug prescribed for bipolar disorder. According to court documents, Abbott Laboratories marketed the drug for unapproved uses, including the treatment of autism, dementia and schizophrenia.

In one settlement, 49 states, the District of Columbia and the federal government reached a $1.5 billion agreement with Abbott to settle the illegal marketing allegations that resulted in false claims to Medicaid and other federal health care programs.

The $1.5 billion settlement marks the largest consumer protection-based pharmaceutical settlement ever reached in the United States, according to a release by R.I. Attorney General Peter F. Kilmartin.

Rhode Island’s complaint, filed with Providence County Superior Court, alleges specific violations of the Ocean State’s Deceptive Trade Practices Act.

Rhode Island will receive roughly $1.22 million under the Medicaid settlement and $1.14 million under the consumer protection settlement.

Abbott will pay the states and the federal government a total of $800 million in civil damages and penalties to compensate federal health care programs. In addition to the civil settlement, the company pleaded guilty to a violation of the Food, Drug and Cosmetic Act and agreed to pay a criminal fine and forfeiture of $700 million.

Under the settlement, Abbott Laboratories is restricted from marketing the drug for uses not approved by the U.S. Food and Drug Administration.

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