Nursing-Home Drug Promotion: When the Sales Pitch Shapes the Prescription

Nursing home pharmaceutical marketing fraud involves misleading sales campaigns or prescription-inducing payments that steer residents toward drugs billed to Medicaid and other government health care programs. Abbott’s Depakote, Janssen’s Risperdal and Avanir’s Nuedexta cases show how a manufacturer can reach a resident through the people making or influencing medication decisions. A sales representative knows the instructions behind the pitch. A consultant pharmacist knows what the pharmacy was paid to recommend. A facility employee may recognize the behaviors the sales campaign turned into reasons to prescribe.

These pharmaceutical fraud cases follow different commercial decisions. The Depakote civil allegations concerned promotion for agitation and aggression in elderly dementia patients. The Risperdal allegations connected safety claims with payments to an institutional pharmacy. The Nuedexta allegations described an effort to turn an initiative to reduce antipsychotic use into demand for another drug. In these allegations, residents received the drugs while manufacturers pursued prescriptions and taxpayers paid the bills.

What Is Considered Off-Label Promotion?

Off-label promotion markets a drug for a use or patient population outside its FDA approval. In the nursing-home cases, the important questions concern the population the manufacturer targeted, the claims its sales force made and the prescriptions billed to Medicaid and other government programs.

The business has several participants between the manufacturer and the payment. Drugs move through wholesalers to dispensers. Manufacturers also enter separate financial arrangements with intermediaries, while a pharmacy, prescriber or facility can submit the government claim.

Depakote Promotion Targeted Elderly Dementia Patients

Abbott’s Depakote civil settlement addressed allegations of promotion for uses government programs did not cover, including agitation and aggression in elderly dementia patients. In the agreed statement of facts filed with its guilty plea, Abbott admitted that its nursing-home sales force targeted that use. The Justice Department’s May 7, 2012 announcement included $800 million in civil settlements, with $84 million announced for the whistleblowers.

The states alleged false and misleading statements about Depakote’s safety, effectiveness, dosing and cost-effectiveness for unapproved uses, together with improper nursing-home marketing and payments to induce prescribing or promotion.

A representative who knows which facilities the company targeted can explain a different part of that story from a pharmacist who knows which recommendations followed. The manufacturer chooses the audience and the message. The people inside the facility see how that message becomes a reason to put a resident on the drug.

The Depakote Pharmacy Arrangements

The pharmacy side produced its own civil settlements. PharMerica agreed to pay $9.25 million in October 2015 to resolve allegations that it solicited and received Abbott kickbacks to promote Depakote to nursing-home patients. The settlement also brought a $1 million whistleblower award. Omnicare later settled allegations involving payments for Depakote recommendations in October 2016.

A sales pitch can reach a nursing home directly, or through a pharmacy whose recommendations already have an audience there. Someone handling that pharmacy account may know the financial arrangement behind a recommendation that appears clinical to everyone else.

Risperdal Promotion Reached the Medication Review

Janssen’s Risperdal allegations concerned both the safety message for elderly dementia patients and payments intended to make pharmacy recommendations favor the drug. Johnson & Johnson’s November 4, 2013 resolution described those different parts of the campaign.

The government alleged that when a study showed significant risks of strokes and other adverse events in elderly dementia patients, Janssen combined its results with other studies to make the overall risk look lower. It also alleged that results from another study confirming increased safety risks remained unpublished a year after the company received them.

The government’s civil complaint also described an FDA warning about the premise of the pitch. Behavioral disturbances in elderly dementia patients could be responses to poor living conditions, the agency cautioned, raising an ethical question about using an antipsychotic for behavioral control. That puts the resident’s circumstances back into a sales story organized around prescribing. A behavior described as a reason to medicate could also be a reason to examine the care the resident was receiving.

Diabetes was another part of the alleged safety message. The government said Janssen promoted Risperdal as free of that concern, then retained outside consultants to reanalyze study results and published articles presenting the drug as associated with a lower diabetes risk.

An insider may know what the study showed, what the company put into the sales material and what it told the people expected to prescribe.

Sales incentives reinforced the alleged targeting. The government said Janssen based representatives’ bonuses on total Risperdal sales in their territories, including sales for unapproved uses. The compensation plan rewarded the sales the campaign produced.

When the Consultant Pharmacist Carries the Pitch

The Omnicare arrangement allegedly bought influence inside nursing homes through consultant pharmacists. The government said Johnson & Johnson paid through market-share rebates, data-purchase agreements, grants and educational funding to induce Omnicare and its consultant pharmacists to promote Risperdal and other company drugs.

Consultant pharmacists purported to give independent recommendations based on clinical judgment. According to the government’s allegations, Johnson & Johnson viewed them as an extension of its sales force. That is the point of the arrangement: the recommendation could arrive with the credibility of a medication review while serving the manufacturer’s sales objective.

For someone inside an institutional pharmacy, the revealing comparison is between the contract and the recommendation. A market-share target explains the business result the manufacturer wanted. Instructions to consultant pharmacists can explain how the pharmacy intended to deliver it. The government alleged a connection between those two things.

Nuedexta and the Effort to Expand the Patient Population

Avanir allegedly promoted Nuedexta to long-term-care providers by describing dementia-associated behaviors as signs of the condition its campaign targeted. The Justice Department’s September 26, 2019 announcement described a federal civil settlement of $95,972,017, alongside a separate state Medicaid settlement, over alleged kickbacks and false or misleading marketing.

The government alleged that Avanir sought to capitalize on efforts by the Centers for Medicare and Medicaid Services to reduce antipsychotic use among dementia patients in long-term-care facilities. Sales representatives were instructed to start conversations about antipsychotics and how Nuedexta could reduce a facility’s reliance on them.

The government’s account described a commercial obstacle. Avanir’s own studies showed a limited population of patients with the condition its Nuedexta campaign targeted. Some physicians told representatives they had few, if any, patients showing its signs.

According to the government, Avanir answered that objection by instructing representatives to give false and misleading information about the behaviors that could indicate that condition. Those behaviors included crying without tears, moaning and other inarticulate sounds commonly observed in dementia patients without that diagnosis. The government alleged that Nuedexta use in long-term-care facilities increased after this strategy.

In the government’s account, a federal push to reduce antipsychotic use became a sales pitch for another drug. When physicians questioned the size of the patient population, the alleged response was to broaden the behaviors the sales force described as signs of the target condition.

That is a different mechanism from paying an institutional pharmacy to recommend a product, even when both can reach the same nursing-home medication decision.

How Do Pharmaceutical Kickbacks Work?

Pharmaceutical kickbacks work by paying someone to influence prescribing, purchasing or recommendations for drugs covered by government programs. In institutional care, that influence can sit with a prescriber, a paid speaker or a pharmacy whose consultant pharmacists advise facilities. The payment and the message can travel together.

The speaker arrangement has two commercial uses: the physician can prescribe the drug and can promote it to peers. The literature review Corporate Crime in the Pharmaceutical Industry Is Common, Serious and Repetitive, from the Nordic Cochrane Centre in 2012, describes that connection in the Neurontin material it reviewed. It describes Warner-Lambert tracking high-volume prescribers and rewarding them with speaker or consulting roles, while briefing speakers on promotional strategy.

The separate whistleblower complaint about Abbott’s TriCor promotion gives a concrete allegation about the audience assembled for a paid talk:

The complaint describes a paid cholesterol talk with the speaker’s friends and staff in the audience. The question also runs through the Risperdal grants and educational funding: what did the manufacturer buy?

Novartis’s separate speaker-program case shows how far the payment can travel from the supposed educational service. In its July 2020 civil resolution, Novartis admitted that some representatives intended honoraria to induce more prescribing. It also admitted paying doctors for events that never happened and repeatedly paying for dinners where doctors sometimes rotated as speaker and recipient of the fee. The same people could take turns being paid to address one another.

An employee who approved the speaker, planned the audience or managed the pharmacy contract may understand the business purpose behind a payment described as education. That knowledge connects the financial record to the prescribing objective.

What Evidence Is Needed to Prove Fraud?

The evidence in these cases connects the manufacturer’s instructions and payments to the patient population and the resulting claims. We work with pharmaceutical whistleblowers to build that account from what they know about the business.

A sales representative may know which uses management wanted discussed and how the company trained people to answer clinical objections. A medical or regulatory employee may know which safety findings were available when promotional material went out. A pharmacy employee may know how market-share targets affected consultant recommendations. A person handling speaker payments may know why a particular prescriber kept getting invited back.

The harm described in these cases is personal as well as financial. The Risperdal allegations concerned safety risks in elderly dementia patients. The Nuedexta allegations concerned behaviors used to expand a sales population.

What Is an Example of a Pharmaceutical Whistleblower Case?

Abbott’s Depakote civil settlement resolved four False Claims Act whistleblower lawsuits. Avanir’s resolution also included employee whistleblower cases.

A whistleblower case under the False Claims Act can pay 15% to 30% of what the government recovers. The value of the insider’s knowledge lies in explaining the business decisions behind the prescriptions, whether that knowledge comes from sales, pharmacy operations, clinical information or promotional payments.

Who Was Behind the Recommendation?

If you saw a nursing-home sales campaign, pharmacy agreement or paid speaking arrangement drive prescribing, speak to one of our whistleblower experts about who drove those prescriptions. We develop the case strategy with you and bring in pharmaceutical fraud whistleblower lawyers who understand how promotion, institutional pharmacies and government claims fit together. We stay beside you throughout the process, building your strongest pharmaceutical whistleblower case from what you know about residents’ medications.