TAP to pay $875 million in Lupron case

TAP Pharmaceutical Products, the US joint venture of Abbott Laboratoriesand Takeda, has pleaded guilty to fraudulent sales and marketing practices with regards to its prostate cancer drug Lupron (leuprolide; Marketletter February 26), and is to pay $875 million to settle the case. Included in that sum is a $290 million fine set by the US Justice Department, and said to be the largest criminal fine ever in a US health care fraud prosecution case. Abbott says its reserves are adequate to cover its half of the settlement costs.

TAP pleaded guilty to charges of having bribed individual doctors with as much as $70,000 in free drug samples for which the latter billed Medicare and patients. The firm also allegedly offered health maintenance organizations large sums in an effort to get them to switch from using AstraZeneca's Zoladex (goserelin). In addition, TAP was accused of manipulating the average price used for government reimbursement to ensure doctors would make at least a $100 profit per dose. The settlement resolves both criminal and civil charges that had been made against the company.