Trenton, New Jersey – A federal judge has mandated Johnson & Johnson’s Janssen Pharmaceuticals unit to pay a hefty $1.64 billion for allegedly marketing two HIV medications, Prezista and Intelence, for unapproved uses. This order followed a recent jury verdict that found the company liable under whistleblower lawsuit claims.
U.S. District Judge Zahid Quraishi ruled that Janssen violated the federal False Claims Act, leading to a direct $360 million fine. The company also faces civil fines amounting to $1.28 billion, which calculates to $8,000 for each of the 159,574 false claims submitted to government programs such as Medicare, Medicaid, and the AIDS Drug Assistance Program.
Judge Quraishi disregarded a previous $30 million jury award for violations of state false claims laws, citing insufficient evidence. The verdict comes after a detailed six-week trial.
Despite the ruling, Janssen sought a retrial, arguing the verdict was influenced by insufficient evidence and flawed jury instructions. Johnson & Johnson, headquartered in New Brunswick, New Jersey, expressed confidence that the ruling would be overturned on appeal.
The claims against Janssen were initially brought to light by Jessica Penelow and Christine Brancaccio, former sales representatives at the company. They accused Janssen of promoting Prezista as “lipid-neutral,” implying it wouldn’t impact cholesterol or triglyceride levels, despite this claim contradicting its FDA-approved labeling.
Additionally, the plaintiffs alleged that Janssen engaged in unethical practices by compensating doctors to endorse these drugs during dinner and speaker events, effectively rendering these payments as kickbacks. While the jury upheld the claims pertaining to off-label marketing, it did not find Janssen liable regarding the kickback allegations.
In his 35-page decision, Judge Quraishi noted substantial evidence that Janssen’s marketing strategies significantly influenced doctors to submit reimbursements to government payers, stating that false claim submissions were a foreseeable outcome of the company’s actions.
Johnson & Johnson, disputing the judge’s rationale, maintained that Janssen’s drug promotions were always consistent with FDA guidelines and criticized the plaintiffs for failing to prove that the promotional activities were intentionally deceitful, materially significant, or directly caused government losses.
Reflecting the severity of the allegations, the $360 million component of the financial penalty represents three times the initial damages of $120 million awarded by the jury, as sanctioned under federal law that authorizes punitive treble damages.
Legal representatives for the whistleblowers, including attorney Pete Marketos, lauded the judge’s decision, asserting that it appropriately addresses the prolonged and severe nature of Janssen’s alleged misconduct.
The case, filed as U.S. ex rel Penelow et al v Janssen Products LP, continues to unfold in the U.S. District Court for the District of New Jersey.
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