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Attorney General Jason R. Ravnsborg

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J&J and Janssen To Pay More Than $1.6 Billion to Resolve Health Care Fraud Allegations


FOR IMMEDIATE RELEASE :    Monday, November 04, 2013
CONTACT:  Sara Rabern (605)773-3215   

Johnson & Johnson and Janssen Pharmaceuticals, Inc.
To Pay More Than $1.6 Billion to Resolve Health Care Fraud Allegations

PIERRE, S.D  -   Attorney General Marty Jackley announced today that South Dakota has joined with other states and the federal government in a global settlement with New Jersey pharmaceutical manufacturer, Johnson & Johnson (J & J) and its subsidiary, Janssen Pharmaceuticals, Inc., to resolve civil and criminal allegations of unlawful marketing practices to promote the sales of their atypical antipsychotic drugs, Risperdal and Invega.

Under the terms of the civil settlement, the companies will pay over $1.2 billion to the states and the federal government. The total portion of the settlement amount recovered by South Dakota is $2,888,232.09, of which $1,908,452.19 will be retained by the federal government as the federal Medicaid share. The remaining $979,779.90 will go to the state general fund to offset alleged Medicaid damages in this case. The settlement resolves four qui tam, or whistleblower, lawsuits filed in the United States District Court for the Eastern District of Pennsylvania, under the provisions of the federal False Claims Act and similar state False Claims statutes. In addition, Janssen Pharmaceuticals, Inc., will plead guilty in federal court to a criminal misdemeanor charge of misbranding Risperdal in violation of the Food, Drug, and Cosmetic Act. As part of the criminal plea, Janssen has agreed to pay an additional $400 million in criminal fines and forfeitures.

J & J and Janssen allegedly promoted and marketed, and introduced Risperdal and Invega into interstate commerce, for uses that were not approved by the Food and Drug Administration (FDA) and for uses that were not medically indicated. Once the FDA approves a drug as safe and effective, a manufacturer cannot market or promote a drug for an “off-label” use, i.e., any use not specified in the FDA-approved product label.  The manufacturers’ alleged unlawful conduct caused false and/or fraudulent claims to be submitted to or caused purchases by government funded health care programs, including the state Medicaid programs.
The South Dakota Medicaid Fraud Control Unit and the South Dakota Department of Social Services assisted in recovering the settlement money.