Abbott joins the federal-probe parade

Abbott Laboratories is the latest drugmaker to find itself in the feds' sights. Officials are probing Abbott's marketing of the epilepsy-and-mood drug Depakote, examining whether the company violated the False Claims Act and anti-kickback rules. The U.S. attorney in the Western District of Virginia is heading up the probe, but the Justice Department declined comment. Abbott, meanwhile, said it is "cooperating with the investigation." Period, full stop.

Pharma has been on the hot seat lately. Whether with off-label marketing charges or kickback allegations, the Justice Department has been all over the industry, announcing settlements and issuing subpoenas regularly. And the settlements have been breaking records, what with Eli Lilly's $1.4 billion Zyprexa deal and Pfizer's $2.3 billion package of payments and fines.

Some law enforcement experts and other pharma-watchers have grown skeptical that even such large settlements will make any difference to the industry's behavior. One prosecutor involved in Pfizer's Neurontin marketing settlement notes that as the company was signing a consent decree promising not to mismarket its drugs, another unit was promoting Bextra and other drugs off-label. "They've repeatedly marketed drugs for things they knew they couldn't demonstrate efficacy for," said Michael Loucks, acting U.S. attorney in Boston.

Indeed, one medical school professor who studied off-label marketing for the National Institute of Mental health said forbidden promotions are just part of the job. "There's an unwritten business plan," Lon Schneider told Bloomberg. "They're drivers that knowingly speed. If stopped, they pay the fine, and then they do it again."

What do you think? Are the record settlements sure to turn pharma over a new leaf? Are they relics of business practices abandoned as a new generation of management has taken over? Or are they, as Schneider alleges, a cost of doing business?

- read the Reuters news
- see the Bloomberg piece

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