AstraZeneca, the drug company behind the blockbuster psychiatric drug Seroquel, has agreed to pay $520 million to settle accusations the company illegally marketed the drug.
The companyâ€™s promotion of the controversial medication spawned two federal investigations and two lawsuits brought by whistle blowers who exposed the wrongdoing, according to a New York Times report. News of the agreed settlement spread today, a day after the release of the companyâ€™s third-quarter financial report, which included a charge for the amount.
Thousands of Lawsuits Filed
The company also admitted in the same financial disclosure that it now faces at least 14,444 civil lawsuits over its handling of Seroquel from former users who say taking the drug caused them to develop diabetes and other health complications, the Times said.
AstraZeneca was accused of promoting off-label, unapproved uses of Seroquel, which is against the law, and mishandling clinical trials of the drug before it was approved. Aggressive marketing of Seroquel has helped make it the best-selling antipsychotic drug in the United States, racking up about $17 billion in sales since 2004, the Times reports, citing data from the research firm IMS Health.
A company spokesman said officials are still hammering out the final details of the settlement with the whistle blowers and the U.S. Department of Justice, which had been investigating the promotion of Seroquel.
Other Drug Companies Pay Fines
If approved, the financial settlement would place AstraZeneca alongside other big drug companies who have reached similar deals to resolve accusations of improper marketing of products.
Eli Lilly & Co. recently paid $1.4 million for illegal marketing of its antipsychotic drug, Zyprexa. Pfizer also said it will pay $2.3 billion in settlement and fines for its handling of the blockbuster painkiller Bextra, which was pulled from the market because of user injuries.