Novo Nordisk Inc. has agreed to pay at least $60 million to end a federal investigation into its marketing practices and resolve seven whistleblower suits alleging the pharmaceutical company misled physicians and insurers about its top-selling Type 2 diabetes drug Victoza, according to the U.S. Department of Justice (DOJ).
Under the settlement, Novo Nordisk will pay out more than $43 million to the federal government and approximately $3.3 million to state Medicaid programs to settle claims under the False Claims Act (FCA). Novo Nordisk, which is a unit of Denmark’s Novo Nordisk A/S, also agreed to disgorge $12.15 million in profits to resolve claims it violated the federal Food, Drug and Cosmetic Act from 2010 to 2012.
The settlement brings to an end an investigation the federal government launched into the drugmaker’s marketing practices and resolves seven suits filed by 11 whistleblowers between 2010 and 2016 who asserted claims under the whistleblower provision of the FCA.
Novo Nordisk agreed to pay $1.1 million to the state of California and $350,000 to the state of Illinois to settle at least one whistleblower suit brought by Peter Dastous, a Novo Nordisk sales representative who was responsible for selling Victoza to endocrinologists in South Carolina and northern Georgia. The suit alleged fraud against private commercial health insurers, and the settlement brings the aggregate settlement amount the company will pay to $60 million. The claims go back to 2010, when the U.S. Food and Drug Administration (FDA) originally approved the drug.
The FDA had required Novo Nordisk to modify its FDA-mandated risk evaluation and mitigation strategies, or REMS, after a 2011 survey revealed that half of primary care doctors polled were unaware of the potential cancer risks associated with the drug, according to the DOJ. The drug has been linked to a rare cancer called medullary thyroid carcinoma, the DOJ said. But rather than appropriately implementing the modification, the government claims Novo Nordisk instructed its sales force to provide statements to doctors that obscured the cancer risk information, allegedly misbranding the drug.
Meanwhile, Dastous, the whistleblower, alleged Novo Nordisk launched an extensive campaign to promote Victoza for off-label uses, including weight loss treatment in patients with all types of diabetes. It also allegedly marketed the drug to patients who were prediabetic, or pediatric patients with Type 2 diabetes, even though the FDA hadn’t approved the use of Victoza for the treatment of pediatric patients due to the lack of pediatric studies, or adults without Type 2 diabetes. When at least one of the complaints was filed, Victoza cost roughly $300 to $400 per month, depending on the dose.
The suits claimed that those prices unnecessarily increased the costs for government health care programs while allegedly endangering patients. U.S. Attorney Channing D. Phillips said that Novo Nordisk’s actions unnecessarily put vulnerable patients at risk, and the litigation sends a “strong signal” to the drug industry that the government is committed to holding companies accountable for violating the integrity of the FDA’s efforts.
Special Agent Nick DiGiulio for the U.S. Department of Health and Human Services’ Office of the Inspector General also emphasized that the government needs to trust that pharmaceutical companies truthfully represent their products’ potential risks. DiGiulio said in a statement:
We will continue to work with our partners to ensure federal health care dollars are spent only on drugs that are marketed honestly.
The federal government is represented by U.S. Attorney Channing D. Phillips, Assistant U.S. Attorney Darrell C. Valdez, acting Assistant Attorney General Chad A. Readler, acting Director Joshua I. Wilkenfeld, Deputy Director Jill Furman and trial attorney Matthew J. Lash. The federal suit is United States et al. v. Novo Nordisk Inc., (case number 1:17-cv-01820) in the U.S. District Court for the District of Columbia. The whistleblower suit filed by Dastous is United States et al. ex rel. Dastous v. Novo Nordisk Inc., (case number 1:11-cv-01662) in the U.S. District Court for the District of Columbia.