Brisbane firm agrees to pay $37 million to resolve
charges of peddling unapproved pharmaceutical use
By Julia Cheever, Bay City News Service
October 26, 2006
SAN FRANCISCO (BCN) - A Brisbane pharmaceutical company
has agreed to pay nearly $37 million to resolve criminal and civil
charges for illegally marketing a drug for an unapproved use,
federal prosecutors announced in San Francisco today.
The agreement with InterMune
Inc. concerning the drug Actimune
was announced by U.S. Attorney Kevin Ryan.
U.S. Attorney Kevin Ryan
A criminal charge filed in federal court in San Francisco on
Wednesday accuses the company of misbranding the drug by fraudulently
promoting it as a treatment for idiopathic pulmonary fibrosis,
a fatal lung-scarring disease, between August 2002 and January
The U.S. Food and Drug Administration has never approved Actimmune
as a treatment for the disease, Ryan said. There is no FDA-approved
treatment for the illness, which afflicts 83,000 Americans.
Under a deferred prosecution agreement also filed in court on
Wednesday, the company will cooperate with an ongoing probe and
will pay the federal government $30.2 million and state governments
$6.7 million plus interest for losses suffered by Medicare, Medicaid,
and other programs.
The charge will be dropped after two years if the company abides
by the agreement, the document says.
The deferred prosecution agreement also states the company disseminated
information claiming the drug may extend the lives of patients
with the disease even though its own studies had not shown the
drug was effective.
Peter Keisler, assistant attorney general in charge of the Justice
Department's civil division, said, "It is vital to public
health and safety that pharmaceutical companies are deterred from
improperly marketing their drugs to doctors and patients to treat
illnesses that these drugs are not approved to treat."
InterMune President Dan Welch said, "We now put this matter
behind us and we will focus our resources on what we believe is
a promising future for our company and our shareholders."
Company spokeswoman Pam Lord said, "This did involve former
employees in a time period that preceded the current management
that has now been installed and is setting up a rigorous compliance
She said the $37 million will be paid over a period of five years.
According to the deferred prosecution agreement, the company received
most of its sales revenue from Actimmune between August 2002 and
January 2003 and the "vast majority" of those sales
were for prescriptions for the lung disease.
The agreement says, "InterMune does not contest that the
Department of Justice developed evidence in its investigation
that one or more employees violated federal law" during that
period by instructing some members of its sales force and a specialty
pharmacy to promote Actimmune as a treatment for idiopathic pulmonary
Actimmune has been approved by the FDA only for treatment of
a rare immune system disease and a rare bone disease that affect
very small numbers of patients.
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