Celgene Pays $280 Million for Off-Label Marketing of Cancer Drugs

Pharmaceutical Industry

Celgene, a pharmaceutical manufacturer based out of New Jersey, paid $280 million following a whistleblower suit which claimed they promoted their popular cancer drugs for unapproved purposes. The two drugs in question, Thalomid and Revlimid, are Celgene’s highest-grossing products, together accounting for $8.4 billion in annual revenue – an astounding 75% of the company’s profits. This figure lends to the whistleblower’s argument that the medications were promoted illicitly, as the diseases they are approved to treat are both minimal and rare.

Beverly Brown was employed as a sales manager for Celgene for over a decade, over which time she became privy to the inappropriate marketing practices the company employed in order to boost off-label sales. In her case, she brought forward a multitude of evidence against her former employer that implied their deliberate misappropriation of the drugs, including studies, letters from national agencies, and testimonies from other Celgene employees. Though her share in the recovered funds has not yet been disclosed, it is speculated she will receive up to $84 million for her participation in the suit.

The evidence dates back to 1998, when the U.S. Food and Drug Administration (FDA) approved their pioneer drug, Thalomid, for the treatment of leprosy complications. Prior to Celgene’s marketing of the drug, it had already been pulled from pharmacies worldwide due to its devastating side effects, primarily involving a variety of horrific birth defects when administered to pregnant women. The controversy that ensued caused a massive upheaval of drug regulations enforced by the FDA, including the necessity of proof that any medication is safe and effectively treats a given ailment. Upon the FDA’s approval for Celgene to market Thalomid, the administration strictly enforced its distribution to ensure that similar tragedies did not occur. However, the medical community remained hopeful that its return to the market would eventually result in its ability to treat a range of diseases, including cancer, AIDS, and a myriad of autoimmune diseases.

Realizing its potential, Celgene took it upon themselves to market Thalomid as treatment for a variety of cancer despite lacking FDA approval to do so. Sales skyrocketed, and suspiciously so – under FDA standards, the drug was only useful for a fraction of the few hundred leprosy cases diagnosed nationwide. To obtain this business, Brown asserts that Celgene heavily pressured their sales representatives to promote Thalomid to oncologists across the country, claiming that it was an effective treatment for cancer. This did not go unnoticed, as evidenced by two warning letters from the FDA dated 1998 and 2000 which ordered Celgene to cease any marketing for Thalomid outside of its approved use. Celgene disregarded the administration’s directives and continued to push the drug unlawfully, so much so that roughly 90 percent of Thalomid’s sales in 2000 were derived from cancer patients.

In the mid-2000s, the FDA finally issued approval for Thalomid and its successor, Revlimid, to be prescribed as treatment for multiple myeloma, with Revlimid also gaining approval for two rare forms of cancer. Still, Brown states that Celgene continued to market both as treatment for cervical, thyroid, brain, and blood cancers even after the FDA ruling. Further, she claims that Celgene sales representatives pressured doctors to switch patients from Thalomid to its more expensive alternative, Revlimid, regardless of medical necessity. This caused the new drug to rise through the ranks and take position as Celgene’s highest-grossing product, raking in $6.97 billion annually. To put it in perspective, the $280 million settlement represents about two weeks of Revlimid’s sales.

Off-label marketing is a pervasive form of pharmaceutical fraud, but this case was particularly well-masked as a result of the diseases Celgene products claimed to treat. Doctors are permitted to prescribe drugs for purposes outside of their typical use, and this practice is exceptionally prevalent among oncologists due to the enigmatic nature of curative cancer treatments. Celgene’s violation lies in their insistence that these drugs effectively treated diseases for which they were not federally approved, and their subsequent manipulation of the medical professionals that prescribed them. Brown’s statement likened these practices to “human experimentation,” subjecting patients to potentially harmful side effects in the sole pursuit of financial gain.

As part of the settlement agreement, Celgene admits no fault and denies all claims brought against them; however, they issued a statement citing the remuneration is partially comprised of reimbursements for Medicare payouts for off-label prescriptions. The recovered funds are to be split between the federal government, who will receive $259.3 million, and 28 separate states and the District of Columbia, who will share the remaining $20.7 million. This case is a significant win for the Department of Justice, and is considered to be in the top 100 of False Claims reparations in United States history.

Whistleblower Justice Network Can Help You

Whistleblower Justice Network partners with whistleblowers to bring those to justice who knowingly violate the False Claims Act. We work with whistleblowers to file their strongest possible case and ensure they are assisted every step of the way, in efforts to expose such fraudulent schemes and restore the integrity of government healthcare programs as a whole.

If you have meaningful information regarding pharmaceutical fraud that you believe is in violation of the False Claims Act, Whistleblower Justice Network can help. Working alongside world-class legal counsel, we will ensure you are protected to the fullest extent of the law and that you receive credit for the information you bring to the U.S. government. Partnering with whistleblowers is all we do. Visit us at www.whistleblowerjustice.net, or call us at 844-WJN-4ALL.

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