Rogues Gallery: DOJ Lists the Worst-Behaved Drug Companies of 2010

Last Updated Jan 25, 2011 5:46 PM EST

Congratulations, Allergan (AGN): The company paid the biggest settlement to the Department of Justice's healthcare fraud and abuse program in 2010, $600 million for the unapproved, "off-label" promotion of Botox for headaches. 2010 was a banner year for bad behavior in the drug business, according to the DOJ. There were:
  • $2.5 billion in health care fraud judgments and settlements.
  • 1,116 new criminal health care fraud investigations.
  • 2,095 potential defendants in those cases.
  • 1,787 ongoing criminal health care fraud investigations pending.
  • 2,977 potential defendants in those cases.
  • 488 cases with criminal charges filed.
  • 931 actual defendants in those cases.
  • 726 defendants convicted of health care fraud-related crimes
The statistic that managers ought to pay most attention to is the one describing them. While I've criticized the DOJ in the past for talking a lot about prosecuting individual executives while not actually doing so, the DOJ reports that The Department of Health and Human Services' Office of the Inspector General banned 3,340 individuals and entities from doing business with the federal government.

Here are the 16 worst-behaved drug and medical device companies in 2010, ranked by the size of the settlements or awards extracted by the DOJ:

  1. Allergan, $600 million, mismarketing of Botox
  2. AstraZeneca, $520 million, mismarketing of Seroquel
  3. Novartis, $422.5 million, mismarketing of Trileptal and others
  4. Forest Labs, $313 million, mismarketing of Lovothroid and Celexa
  5. Mylan/UDL Labs/AZ and Johnson & Johnson, $124 million, underpaid rebates to Medicaid
  6. Teva, $100 million, inflated prices
  7. J&J, $81 million, mismarketing of Topamax
  8. Novartis, $72.5 million, mismarketing of TOBI for cystic fibrosis
  9. Alpharma, $42.5 million, mismarketing of Kadian
  10. KV Pharmaceutical, $27.5 million, oversized pills
  11. Biovail, $24.7 million, mismarketing of Cardizem
  12. Boston Scientific, $22 million, kickbacks on defibrillators
  13. Cardinal Health and Bindley Western, $5.5 million, overcharging the DOD
  14. Spectranetics Corporation, $4.9 million, marketing unapproved medical devices
  15. Atricure, $3.7 million, mismarketing surgical devices
  16. Sandoz, $3.5 million, fraudulent reimbursement for nitroglycerin tablets
You can see previous years' reports here.

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