Novartis Pharmaceuticals Settlement

PIERRE, S.D.-   Attorney General Marty Jackley today announced that South Dakota will receive $202,731.34 as part of a $72.5 million settlement with Novartis Pharmaceuticals Corporation and Novartis Vaccines & Diagnostics, Inc. (“Novartis”), that involved 49 states,  the District of Columbia and the federal government. The agreement with Novartis resolves allegations that the company promoted the use of tobramycin, a cystic fibrosis drug which is marketed under the trade name TOBI®, for uses not approved by the Food & Drug Administration.  The settlement also resolves claims brought by three former employees of Chiron Corporation, the company that manufactured and marketed TOBI® before it was acquired by Novartis in 2006.

The participating states and the federal government alleged that from January 2001 through July 2006 TOBI® was marketed for off- label indications that were not medically accepted indications for which the state Medicaid Programs provided coverage. The off- label marketing included promoting the drug for diseases other than cystic fibrosis and for use in cystic fibrosis patients under the age of six.

As a result of this settlement, Novartis will pay damages equal to double the amount the state expended for prescriptions written as a result the company’s off- label marketing.

The South Dakota Medicaid Fraud Control Unit and the South Dakota Department of Social 

Services assisted in recovering the settlement money.