RALEIGH, N.C.--Pharmaceutical manufacturer InterMune, Inc. has paid nearly $570,000 to North Carolina as part of a $36.9 million national settlement to resolve allegations that the company unlawfully marketed its drug Actimmune for unapproved uses, Attorney General Roy Cooper announced today.
“Misleading drug marketing means that patients and taxpayers pay for treatments that haven’t been approved,” Cooper said. “We’ll continue to crack down on Medicaid fraud and abuse, which hurts needy patients and drives up health care costs for all of us.”
The settlement addresses allegations that InterMune of Brisbane, California marketed Actimmune for uses that had not been approved by the Food and Drug Administration (FDA). The FDA approved Actimmune to treat two rare diseases, chronic granulomatous disease (an inherited immune disorder) and severe, malignant osteopetrosis (a disorder that weakens the bones). However, between January 2001 and June 2003, InterMune promoted Actimmune for a use which the FDA had not approved, the treatment of idiopathic pulmonary fibrosis (a condition that harms lung tissue).
Under the settlement, InterMune will pay North Carolina, other states, and the federal government a total of $36,944,043.63 million in damages, plus interest, to compensate Medicaid and various federal healthcare programs for harm suffered as a result of this conduct. North Carolina has recovered $569,740.05 to support state and federal Medicaid efforts in the state. Medicaid is a joint federal-state program that provides health insurance for the poor.
The settlement is based on a whistleblower case filed in the U.S. District Court for the Eastern District of Pennsylvania. A team formed by the National Association of Medicaid Fraud Control Units conducted settlement negotiations with InterMune on behalf of participating states. The North Carolina settlement was reached by the Attorney General’s Medicaid Investigations Unit (MIU) and the N.C. Division of Medical Assistance.
Over the past decade, the North Carolina MIU has recovered more than $361 million from hospitals, doctors, pharmaceutical makers, medical equipment companies, mental health and personal care providers, ambulance services and others. The MIU has also helped convict 229 individuals on criminal charges including patient abuse and neglect as well as financial fraud. In the federal fiscal year that ended September 30, 2009, the MIU recovered $43.5 million and won 27 criminal convictions.
The state budget recently approved by the legislature included 25 new Medicaid fraud positions for the Department of Justice at Gov. Bev Perdue’s request, nearly doubling it in size. The new attorneys and investigators will expand the crackdown, particularly on community service providers that commit fraud.