Office of the Attorney General
Attorney General Conway Announces $425-million Settlement with Cephalon, Inc.
Attorney General Jack Conway today announced that his Medicaid Fraud & Abuse Control Unit has recovered $2.37 million from Pennsylvania-based Cephalon, Inc., one of the world’s top ten biotechnology pharmaceutical companies.
The recovery resulted from a joint investigation by the National Association of Medicaid Fraud Control Units and the federal government, which disclosed that Cephalon improperly marketed the sleep disorder drug Provigil, the seizure drug Gabitril and the painkiller Actiq for uses that had not been approved by the Food and Drug Administration.
“Marketing drugs for off-label use is a dangerous practice that can have tragic consequences for patients,” General Conway said. “I appreciate the work of our team to investigate this case and secure reimbursement for the Kentucky Medicaid program.”
As part of its illegal “off-label” marketing scheme, Cephalon provided millions of dollars in educational grants to induce physicians to prescribe Provigil, Gabitril, and Actiq for non-approved uses. In some instances, Cephalon’s promotion of the off-label use of Gabitril as a remedy for anxiety, insomnia, and pain, resulted in reports of seizures in patients did not have epilepsy. The occurrence of seizures prompted the FDA to require Cephalon to send a warning to physicians advising them of the risks in connection with off-label Gabitril use.
Cephalon paid a total of $425 million in damages and civil and criminal fines and penalties to resolve the off-label marketing claims. This settlement reimburses Kentucky, the other participating states and the federal government for excessive amounts paid by the Medicaid program as a result of Cephalon's improper off-label marketing campaign.