Office of the Attorney General
Attorney General Conway Announces Settlement with Inspire Pharmaceuticals

Press Release Date:  Thursday, June 18, 2015  
Contact Information:  Leland Hulbert
Deputy Communications Director

Attorney General Jack Conway announced his office and 48 attorneys general joined the federal government to reach a settlement with manufacturer Inspire Pharmaceuticals, Inc., a pharmaceutical company with its U.S. headquarters in Illinois.  This resolution settles allegations that the company violated the False Claims Act by misleadingly marketing its drug AzaSite.  It is alleged that these misleading practices caused doctors to write prescriptions for a non-FDA approved use that resulted in Medicaid and federal healthcare programs paying millions of dollars in false claims.  

The FDA only approved AzaSite for the treatment of bacterial conjunctivitis (pink eye).  However, Inspire marketed AzaSite for the treatment of blepharitis, the inflammation of eyelash follicles around the edge of the eyelid, for which it had not obtained FDA approval, by intentionally and misleadingly emphasizing the purported anti-inflammatory properties of AzaSite that had not been demonstrated by substantial evidence or substantial clinical experience.  As a result of the settlement, Inspire will pay the states and the federal government $6 million.

“Patients have a right to trust they are being prescribed properly tested and effective medicine,” said Attorney General Conway.  “Pharmaceutical companies like Inspire will not be permitted to skirt FDA rules and regulations to make a profit at the expense of patients.  These FDA rules are enforced to ensure patients are only prescribed drugs that are proven to benefit the patient.”

The investigation that led to the settlement grew out of a false claims action filed by a former Inspire sales territory manager in 2010.  The whistleblower’s complaint alleged that beginning shortly after AzaSite came on the market in 2007, Inspire endeavored to maximize its profits by promoting the drug for conditions other than pink eye, specifically blepharitis, a condition which is typically treated with warm compresses and lid scrubs, not pharmaceuticals, and resulted in causing false claims to be submitted to state and federal healthcare programs.  In 2011, the FDA also issued a warning letter to Inspire for a misleading advertisement for AzaSite that constituted misbranding.

The total Medicaid portion of the settlement, state and federal, is $2.2 million; and the states’ share of the Medicaid recovery is just over $1 million.  Forty-seven states and the District of Columbia are participating in the settlement. Kentucky’s Medicaid share of this settlement was $51,456.89.  The federal share of that amount was $$39,353.97 and the state will receive $12,102.92. 

Medicaid Recoveries Kentucky

Attorney General Conway has investigated and prosecuted more abuse and neglect cases than any previous Kentucky Attorney General.  Since Attorney General Conway took office in January 2008, his Office of Medicaid Fraud and Abuse Control has led or participated in actions that have recovered more than $300 million for state and federal-funded Medical programs. These cases range from lawsuits and settlements against pharmaceutical companies to cases against individual providers.

In 2012, Attorney General Conway’s Medicaid Fraud Unit was named one of the most aggressive in the country by the nonprofit watchdog group Public Citizen.  The Attorney General’s tip line for reporting allegations of abuse is 1-877-228-7384.