R.I. gets $762,600 in Medicaid fraud settlement

PROVIDENCE – The pharmaceutical manufacturer Cephalon Inc. will pay $762,600 to Rhode Island’s Medicaid program as part of a $375 million national settlement with several states and the federal government in a Medicaid fraud case, R.I. Attorney General Patrick C. Lynch said.
The R.I. Department of Human Services, which administers Medicaid in the state, will get $327,952, and the rest will go to the federal government.
In a plea agreement filed in federal court in Pennsylvania, Cephalon also committed itself to pay $50 million to resolve a criminal case alleging a misdemeanor violation of the U.S. Food, Drug, and Cosmetic Act. Also, Cephalon entered into a Corporate Integrity Agreement with the U.S. Department of Health and Human Services (HHS) requiring strict scrutiny of its future marketing and sales practices.
The case involved Cephalon’s alleged practice of promoting the drugs Provigil, Gabitril and Actiq for uses other than what the U.S. Food and Drug Administration had approved. Cephalon also funded continuing medical education programs, through millions of dollars in grants, to promote off-label uses for those drugs.
Although Gabitril, for example, is FDA-approved only as a partial treatment for seizures, Cephalon marketed the drug as a remedy for anxiety, insomnia, and pain. Following reports of seizures in patients who did not have epilepsy and who were taking Gabitril, the FDA required Cephalon to send a warning to doctors, advising them of the risks of seizures in connection with the off-label use of Gabitril.
In general, Lynch noted in a news release, it is illegal for pharmaceutical manufacturers to promote the off-label use of their drugs, even though doctors are permitted to prescribe for such uses.
“Cephalon’s illegal sales and marketing tactics concerning these medications are shameful,” Lynch said. “This pharmaceutical company is paying the price for engaging in illegal and deceptive practices at the expense of vulnerable people here in Rhode Island and throughout our nation.”