J&J Is Spitzer’s Next Target: New York AG Opens Broad Off-Label Investigation

Johnson & Johnson is responding to a request from the New York Attorney General for information about marketing practices for its six largest prescription drug brands.

"On July 27, 2004, the company received a letter request from the New York State Attorney General's Office for documents pertaining to marketing, off-label sales and clinical trials for Topamax , Risperdal , Procrit , Reminyl , Remicade and Aciphex ," J&J said in its Aug. 3 ¹ 10-Q filing.

Like most large pharmaceutical companies, J&J is already facing multiple investigations into its marketing practices.

However, the new investigation involves a charismatic, high-profile prosecutor, New York Attorney General Eliot Spitzer, and has an unusually broad scope.

The New York AG has initiated a string of actions against the drug industry over the past two months, beginning with a lawsuit against GlaxoSmithKline over the company's use of Paxil pediatric clinical trials in promoting the antidepressant.

Spitzer's lawsuit alleges that GSK concealed negative data about the use of Paxil in pediatric patients while promoting positive results (² (Also see "GSK Faces New York Suit Over Paxil: Publish Or Punish?" - Pink Sheet, 7 Jun, 2004.), p. 3).

The Spitzer case has brought renewed attention to the longstanding complaints about "publication bias," prompting a number of pharmaceutical companies - most recently, Lilly - to announce new plans to make clinical trial results more readily available.

However, the Paxil case also represented a new approach to prosecution for off-label promotion.

Former Department of Justice prosecutor Reed Stephens told a recent conference Spitzer has "leaped ahead" of federal prosecutors by tying an off-label promotion case to fraud statutes, rather than the False Claims Act (³ (Also see "Neurontin, Paxil Suits Demonstrate Complications Of State Prosecutions" - Pink Sheet, 28 Jun, 2004.), p. 34).

The J&J inquiry is the clearest indication yet that Spitzer is looking beyond the antidepressant safety issue in investigating the drug industry.

After filing suit against GSK, Spitzer followed up with a request for information from Forest about its clinical trials and marketing practices for Celexa and Lexapro (⁴ 'The Pink Sheet' July 5, 2004, In Brief).

Most recently, the attorney general filed suit against Express Scripts alleging the pharmacy benefit manager overcharged New York state for generic drugs (see ⁵ (Also see "PBMs Still In Prosecutors’ Sights; Express Scripts Faces Spitzer" - Pink Sheet, 9 Aug, 2004.)).

J&J's medical device division Ethicon is already under investigation by Spitzer over contracting practices.

The New York AG issued subpoenas in January and February 2003 "regarding the bundling of sutures and endoscopic instruments in contracts offered to Group Purchasing Organizations and individual hospitals," the 10-Q filing notes.

J&J's pharmaceutical marketing practices are under investigation in at least two federal venues.

Risperdal is one of a number of psychopharmaceutical products under investigation by the Office of Personnel Management working with the U.S. Attorney in Philadelphia (⁶ (Also see "Lilly Zyprexa Marketing Info Sought By Philadelphia U.S. Attorney" - Pink Sheet, 29 Mar, 2004.), p. 17).

The U.S. Attorney in Boston is also investigating J&J's marketing of the anti-epileptic Topamax (⁷ 'The Pink Sheet' Dec. 15, 2003, In Brief). Both Risperdal and Topamax are widely used off label.

One indication of the possible direction of the investigations came early in July, when some medical journal publishing companies are understood to have been subpoenaed regarding Risperdal (⁸ 'The Pink Sheet' July 19, 2004, In Brief).

J&J's off-label promotional practices for the acne drug Retin-A were the subject of a joint FDA, DoJ and Newark grand jury investigation in the early 1990s.

The company's Ortho subsidiary pled guilty in January 1995 to 10 counts of obstruction of justice and persuading employees to destroy Retin-A documents relating to photo-aging promotions while the investigation was ongoing.

Ortho agreed to pay $5 mil. in criminal fines and $2.5 mil. in restitution and the cost of the prosecution.