Psych Diagnoses Fraud Leads to Pharmaceutical Prosecutions

NowPublic.com
Kevin Hall
October 8, 2012

Nearly all major psychiatric drug manufacturers have been convicted of illegal marketing and/or fraudulent claims. Several of these cases are linked below. Any that haven't been prosecuted, probably should be.

The reason behind this is simple. There are no medical tests to confirm or deny any mental disorder or diagnoses. A few decades back, psychiatrists "voted" that mental "illness" was caused by a "chemical imbalance of the brain." This is drug marketing, not science. Nobody votes in diabetes or cancer as medical disease and there are sound medical and lab tests for these and other medical diseases.

Psychiatric diagnoses is merely opinion of behavior. Psychiatrists simply vote on what is or is not a mental disorder and place these diagnoses into the American Psychiatric Association's "Diagnostic and Statistical Manual." Their controversial DSM5 is set to be released in 2013 and will likely lead to more pharmaceutical fraudulent marketing prosecutions and settlements.

The reason is simple. If there is no identifiable disease, there can never be a drug that will cure. In fact, there are no cures for any mental disorders. The drugs are generally uppers (ADHD drugs) or downers (anti-anxiety drugs and antipsychotics) that merely mask symptoms in some cases while having extremely dangerous side effects. The upper-type antidepressants have been proven to be very little, if any, more effective than a placebo (sugar pill) yet greatly increase sexual dysfunction while also increasing the likelihood of violence and suicide. Honest marketing would refer to them as anti-sex drugs.

The flow (explained and graphed here) is that psychiatrists create a disease by voting, then pharmaceuticals make the drug. Psychiatrists, usually at major universities, create fraudulent studies that the FDA approves on the word of the drug companies that funded the studies. Once they get approval for a certain condition (such as depression) and population (such as men over age 18, etc.), they get some paid-off psychiatrist to create and get published a study saying that the drug is helpful for other populations and diagnoses. This allows for what is termed off-label prescribing.

It's all fraud and all prosecutable.

The story printed below on Abbott Labs (Depakote) came out last week. It's the Virginia Attorney General's press release www.oag.state.va.us/Media%20and%20News%20Releases/News_Releases/Cuccinelli/100212_Abbott_Labs.html .
Here are some other links to recent settlements with:

GlaxoSmithKline (Paxil) http://www.justice.gov/opa/pr/2012/July/12-civ-842.html ;

Johnson & Johnson, (Risperdal, Invega) www.nytimes.com/2012/04/12/business/drug-giant-is-fined-1-2-billion-in-arkansas.html?_r=0, www.bloomberg.com/news/2012-08-30/j-j-will-pay-181-million-to-settle-risperdal-ad-claims.html, http://www.bloomberg.com/news/2012-08-31/j-j-loses-appeal-of-257-7-million-risperdal-verdict.html  ;

Pfizer, (Zoloft,Geodon, etc.) www.msnbc.msn.com/id/32657347/ns/business-us_business/t/pfizer-pay-record-billion-penalty/#.UHLjXVF_P1U ;

Astrazeneca, (Seroquel) www.azcentral.com/business/articles/2010/04/27/20100427astra-zeneca-settlement.html ;

Bristol-Myers Squibb (Abilify) www.justice.gov/opa/pr/2007/September/07_civ_782.html ;

Eli Lilly (Zyprexa) www.justice.gov/opa/pr/2009/January/09-civ-038.html .

Maybe it is time that some of the psychiatrists creating the fraudulent diagnoses and studies start getting criminally prosecuted for fraud?


Commonwealth of Virginia
Office of the Attorney General


For media inquiries only, contact:  Brian J. Gottstein
Email: bgottstein@oag.state.va.us (best contact method)
Phone: 804-786-5874

Sentencing in Abbott Labs Depakote case: Judge approves $1.5 billion settlement to resolve complaints of off-label promotion of drug

~ Virginia-led investigation was largest state Medicaid fraud investigation in U.S. history ~

ABINGDON, VA (October 2, 2012) - As part of the largest Medicaid fraud case ever led by a state, Attorney General Ken Cuccinelli announced the sentencing of global health care company Abbott Laboratories Inc. in the United States District Court in Abingdon, Va., today. The court approved the $1.5 billion settlement reached on May 7, 2012, among Abbott, Virginia, the United States government, and 48 other states and the District of Columbia, in which Abbott pled guilty to a criminal charge and admitted civil liability for the company's unlawful promotion of the prescription drug Depakote for uses not approved as safe and effective by the Food and Drug Administration (FDA). 

The attorney general's Medicaid Fraud Control Unit (MFCU) was the lead investigative agency in the case, partnering with the prosecutors and civil attorneys from the U.S. Attorney's Office for the Western District of Virginia. This was the largest Medicaid fraud recovery in U.S. history resulting from a state-led investigation, with the Virginia MFCU spending more than four years on the investigation, traveling to 26 states to conduct interviews and sifting through more than one million records looking for evidence.

When it pled guilty in May, Abbott agreed to pay $1.5 billion to resolve its criminal and civil liability pertaining to government health care programs that were defrauded based on reimbursements paid for Depakote due to Abbott's illegal marketing practices. The settlement that was approved today includes a criminal fine and forfeiture totaling $700 million and civil settlements with the federal government and the states totaling $800 million. The civil settlement includes $270 million for the federal government's share of the Medicaid program; $239 million for the states' share of the Medicaid program; and $291 million for Medicare and other federal programs. Abbott will also pay a $500 million fine to the federal government, $198.5 million in criminal asset forfeiture penalties, and $1.5 million to Virginia MFCU to cover investigative costs. Virginia's share of the Medicaid civil settlement is $4.2 million. 

Abbott must also agree to the terms of a Corporate Integrity Agreement with the Office of the Inspector General for the Department of Health and Human Services.

"I've made fighting Medicaid fraud a priority in Virginia by increasing the size of our fraud team by adding 30 new people over the last two years," said Cuccinelli. "I'm committed to ensuring that money intended for medical services for the poor isn't stolen from them and the taxpayers through fraud. Medicaid dollars are limited, and fraud deprives people in true need of necessary medical care."

He continued, "This settlement will allow 49 states, the District of Columbia, and the federal government to recover money fraudulently taken from Medicaid, Medicare, and other health care programs." Louisiana is pursuing separate litigation.

On May 7, Abbott pled guilty to misbranding Depakote by promoting the drug to control agitation and aggression in elderly dementia patients and to treat schizophrenia when neither of these uses was FDA approved. In an agreed statement of facts filed in the criminal action, Abbott admitted that from 1998 through 2006, the company maintained a specialized sales force trained to market Depakote in nursing homes for the control of agitation and aggression in elderly dementia patients, despite the absence of credible scientific evidence that Depakote was safe and effective for that use. In addition, from 2001 through 2006, the company marketed Depakote in combination with atypical antipsychotic drugs to treat schizophrenia, even after its clinical trials failed to demonstrate that adding Depakote was any more effective than an atypical antipsychotic alone for that use.

The FDA is responsible for approving drugs as safe and effective for specified uses. Under the Food, Drug and Cosmetic Act (FDCA), a company in its application to the FDA must specify each intended use of a drug. A company's promotional activities must be limited to only the intended uses that are FDA approved. Promotion by the manufacturer for other uses - known as "off-label" uses - renders the product misbranded, and is illegal.

 For more information on the history of the Abbott Labs settlement, please click here.

Virginia's role in the Abbott case

In September 2007, the Virginia attorney general's Medicaid Fraud Control Unit (MFCU) was contacted with allegations of off-label drug marketing by Abbott Pharmaceuticals.

Although neither the whistleblowers nor the defendant in this case were located in Virginia, the whistleblowers came to Virginia because the MFCU has a national reputation for successfully investigating major national cases, such as the Purdue Pharma Oxycontin case, the Octagon case, and others.

Following Virginia MFCU's initial investigation, the unit contacted the U.S. Attorney's Office for the Western District of Virginia because of their history of working together on such cases. They then began a joint investigation.

On October 31, 2007, the first qui tam ("whistleblower") suit was filed in the United States District Court in Abingdon, Va., against Abbott Laboratories for marketing the drug Depakote for off-label uses. Three other qui tam complaints from other relators were subsequently filed.

MFCU investigators operating out of the attorney general's offices in Roanoke and Abingdon were assigned to the investigation full-time and spent more than four years and 38,000 man-hours on the investigation, traveling to 26 states to conduct interviews and sifting through more than one million records looking for evidence.

The investigation uncovered that Abbott illegally marketed Depakote for non-approved uses, including as an alternative to antipsychotics to treat dementia patients in nursing homes, and for schizophrenia. The investigation also revealed that Abbott paid rebates to health care professionals and long-term care pharmacies for increasing their off-label use of Depakote. 

Attorney General Cuccinelli would like to thank Randall "Randy" Clouse, Director and Chief of Health Care Fraud and Elder Abuse section, and the following MFCU investigators and attorneys for their work in this case: Erica Bailey, Mary Blackburn, Steve Buck, Beverly Darby, Harold Erwin, Elizabeth Fitzgerald, William Clay Garrett, Doug Johnson, John Johnston, Kristy Knighton, Adele Neiburg, John Peirce, and Joey Rusek.

Virginia's MFCU: A history of stopping Medicaid fraud

The Virginia MFCU was established in 1982 within the attorney general's office to investigate and prosecute insurance fraud against the federally funded Medicaid program for indigent health services. MFCU employs a professional staff of criminal investigators, auditors, and several assistant attorneys general who are experienced in commercial and financial investigations. MFCU works regularly with federal and state law enforcement agencies, as well as private insurance companies operating within Virginia.

Over the past 30 years, prior to the Abbott case, Virginia's MFCU had recovered nearly $800 million by tracking down and prosecuting Medicaid fraud offenders. This fiscal year alone, MFCU has recovered more than $22 million. MFCU was also involved in the recovery of more than $634 million after a joint criminal investigation revealed that Purdue Pharma Company fraudulently misbranded the drug OxyContin by marketing the drug to physicians as a slower release -- and thus less addictive -- drug than other prescription opioids. 

From 2010 to today, Attorney General Cuccinelli increased the number of Medicaid fraud and elder abuse staff by more than 50 percent (from 56 to 86) to better combat fraud in Virginia's Medicaid program and to protect the elderly from individuals who abuse and neglect them in nursing homes and health care facilities. It is the only section of the office that he has grown significantly during his tenure, while he has maintained a smaller general fund budget allocation than when he came into office.