FCA Alert

On September 1, 2010, Allergan announced that it reached a resolution with the United States Department of Justice (DOJ) regarding the DOJ’s criminal and civil investigation into Allergan’s past U.S. sales and marketing practices relating to certain therapeutic uses of BOTOX® (onabotulinumtoxinA). 

The settlement provides for the following:

• Allergan will plead guilty to a single misdemeanor “misbranding” charge covering the period 2000 through 2005 and pay the Government $375 million.  According to Allergan, the misbranding charge is known as a strict liability offense and does not involve false or deceptive conduct.

• Allergan will pay $225 million to resolve civil claims asserted by the DOJ under the civil False Claims Act.  Allergan believes this settlement is in the best interest of the stockholders, denies liability associated with these civil allegations, and believes there is no merit to them factually or legally.

• Allergan agrees to enter into a Corporate Integrity Agreement (CIA) with the Office of the Inspector General and the U.S. Department of Health and Human Services.  Under the CIA, Allergan will maintain its current compliance program and undertake a series of compliance related obligations, including additional monitoring, maintenance of specific written standards, auditing, training, education, reporting and disclosure, for five years.  The CIA also provides for an independent third-party review organization to assess and report on Allergan’s compliance program.

• Allergan will dismiss its First Amendment lawsuit pending in Washington, D.C., in which Allergan sought a ruling that it could proactively share truthful scientific and medical information with the medical community to assist physicians in evaluating the risks and benefits if they choose to use BOTOX® off-label to treat certain forms of spasticity.

The criminal resolution is subject to approval by the federal court in the Northern District of Georgia, and the civil settlement is contingent upon such approval.