Judge orders Aegerion's Juxtapid case to trial, with some choice words for corporate pleas

Boston judge William Young on Monday rejected Aegerion's proposed $36 million settlement and ordered the case to trial instead.

Aegerion may have thought it was in the clear when it agreed to pay $36 million to settle federal claims that it broke the law in marketing its cholesterol drug Juxtapid.

But a federal judge on Monday blocked the deal and ordered the case to trial, writing (PDF) that the Juxtapid agreement highlights a "two-tier criminal justice system" that benefits corporations at the expense of individuals. 

"Corporate pleas involve well-educated elites talking to other equally well-educated elites," Judge William Young in Boston wrote in Monday's order. "Things are said, sanctions imposed, nothing really happens. Prices do not come down. Consumers gain no perceptible benefit. Corporations march on, apparently impervious to government regulation or the law itself." 

Now a subsidiary of Novelion, Aegerion's key product is the cholesterol medication Juxtapid, which brought in more than $100 million last year. Aegerion ran into trouble for allegedly pushing the med outside of its FDA indication, violating risk-management regulations and breaking anti-kickback laws with its charity donations. Juxtapid was FDA-approved to lower cholesterol in patients with homozygous familial hypercholesterolemia, a rare disorder, but U.S. officials said Aegerion marketed it as a remedy for high cholesterol generally.

RELATED: Aegerion to pay $36M to settle claims it risked safety with Juxtapid promotions 

Even though Aegerion has overhauled its top management and is cooperating with the federal investigation, Young noted, the deal provides "not one cent of restitution to the actual victims" who took Juxtapid over more appropriate medicines as a result of a complex and illicit marketing strategy. 

"How can I possibly justify such a result," the judge questioned in the filing. 

During his review of the Aegerion case, Young further considered the societal impacts of such corporate plea deals. He expressed particular distaste for a type of settlement called a "C" plea that many corporations—Aegerion included—have sought to enter in recent years; such pleas restrict the judge's power at sentencing, he wrote.

Individuals facing prosecution don't get some of the negotiating benefits that are often granted to corporations, Young also noted. The judge wrote that many companies seek to enter into the private talks in order to avoid having their scandals play out in a lengthy and public legal process.  

So, Young believed accepting the Aegerion settlement deal is "simply not in the public interest" and ordered the case to trial. 

Juxtapid brought in $101 million in 2016 sales, Novelion reported (PDF), or about two-thirds of the company's sales. Back in 2015, Aegerion had to fire its CEO for talking up the drug's benefits in a TV segment, an appearance that led to an FDA warning letter. The DOJ later subpoenaed the drugmaker to learn about its marketing efforts.  

Aegerion was the first company to agree to settle an investigation into suspected charity kickbacks, an industrywide probe that has spread to some of pharma's largest drugmakers such as Pfizer and Johnson & Johnson. United Therapeutics has set aside $210 million for its own potential settlement.