(Reuters) - Abbott Laboratories and AbbVie Inc will pay a total of $25 million to resolve allegations that Abbott paid kickbacks to doctors in exchange for prescribing the cholesterol drug TriCor and promoted the medication for unapproved purposes.
The U.S. Justice Department on Friday announced the settlement, which resolves claims first raised in a whistleblower lawsuit filed in federal court in Philadelphia in 2009 by a former Abbott sales representative. AbbVie was spun out of Abbott in 2013.
Neither company, both of which are based in Chicago, admitted to wrongdoing as part of the settlement.
AbbVie in a statement said the settlement concerned sales and marketing practices that occurred over a decade ago.
“The company determined it was in its best interest to resolve these allegations, rather than engage in protracted litigation, and focus on current business priorities,” AbbVie said.
Abbott declined to comment.
The lawsuit alleged that from 2006 to 2008, Abbott, through its sales representatives, provided physicians kickbacks in the form of gift baskets, gift cards and other items in order to encourage them to write prescriptions for TriCor.
The lawsuit claimed that Abbott also retained healthcare providers for consulting services and speaking engagements in order to induce or reward doctors for writing prescriptions for the drug.
Abbott also improperly marketed and promoted TriCor for purposes other than those approved by the U.S. Food and Drug Administration, including as a treatment to prevent or reduce cardiac health risks in diabetic patients, the lawsuit said.
The lawsuit was filed by Amy Bergman, a former Abbott sales representative, under the False Claims Act, which allows whistleblowers to sue companies on the government’s behalf to recover taxpayer money paid out based on fraudulent claims.
The government may intervene in such cases, but chose not to in this case, leaving Bergman to litigate it on her own prior to the settlement’s being announced. As a reward, Bergman will receive $6.5 million as her share of the settlement.
The case is U.S. ex rel. Amy Bergman, et al. v. Abbott Laboratories, U.S. District Court, Eastern District of Pennsylvania, No. 09-04264.
Reporting by Nate Raymond in Boston; Editing by Leslie Adler and Bill Berkrot