Healthy Skepticism Library item: 16515

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Publication type: news

Van Voris B, Cronin Fisk M, Feeley J
Lilly Reaches Zyprexa Agreement With Seven States
Bloomberg News 2009 Sep 21
http://www.bloomberg.com/apps/news?pid=20601202&sid=aWeB4vET2JfI

Full text:

Sept. 21 (Bloomberg) — Eli Lilly & Co. agreed to settle, on confidential terms, lawsuits filed by seven states alleging the company improperly marketed its antipsychotic drug Zyprexa, a court-appointed official said.

“All of the states have essentially settled for the same” non-monetary arrangements, said Michael Rozen, special master appointed by the court to help settlement negotiations. The money terms, which weren’t disclosed, “have fallen roughly in line,” he said at a hearing today in federal court in Brooklyn, New York.

Lawyers told U.S. District Judge Jack B. Weinstein, who is overseeing the cases, that finishing the settlements may be delayed while the parties determine how much money the U.S. government plans to claim in compensation for federal dollars spent on Zyprexa through state Medicaid programs.

If completed and approved in court, the settlements would leave four suits filed by states pending against Lilly.

Zyprexa, Lilly’s best-selling drug, has been the subject of federal and state investigations into whether the company marketed the medicine, approved for schizophrenia and bipolar disorder, for unapproved, or off-label, uses. Lilly resolved a marketing investigation in January with the U.S. Justice Department, promising to pay $1.42 billion, including about $362 million to more than 30 states.

The federal settlement left pending 12 lawsuits brought by individual states. Lilly announced July 22 that it would take a pretax charge of $102 million this quarter for settling “several” state lawsuits over Zyprexa. The company last month filed a $22.5 million settlement with West Virginia.

‘Advanced Discussions’

“We’re in advanced discussions with a number of states that are still outstanding,” Marni Lemons, a spokeswoman for Indianapolis-based Lilly, said in a phone interview today. “There is nothing that is finalized.”

Representatives of several of the states that have reached deals with Lilly said they’re reluctant to complete the agreements until resolution of the federal claim.

The state lawsuits were seeking reimbursement for funds spent on Medicaid, the government health program for the poor. South Carolina’s lawsuit is set to begin trial next month.

Zyprexa, part of a class of medications called atypical antipsychotics, has been linked to excessive weight gain and diabetes. The lawsuits also claim Lilly failed to properly warn of Zyprexa’s side effects.

Lilly agreed in October to pay a total of $62 million to 32 states and the District of Columbia to settle consumer protection claims over improper marketing.

The lawsuits are part of In re Zyprexa Products Liability Litigation, 04-MD-1596, U.S. District Court, Eastern District of New York (Brooklyn).

To contact the reporters on this story: Bob Van Voris in New York at rvanvoris@bloomberg.net; Margaret Cronin Fisk in Southfield, Michigan, at mcfisk@bloomberg.net; Jef Feeley in Wilmington, Delaware, at jfeeley@bloomberg.net.