Nearly a year after a jury decided that Johnson & Johnson should be fined just over $150 million in a lawsuit alleging that the company engaged in misleading marketing tactics for two of its HIV meds, a judge has upped the penalty more than tenfold.
In an opinion filed Friday, U.S. District Judge Zahid Quraishi of New Jersey followed up on the June jury decision that found J&J’s Janssen, now known as J&J Innovative Medicine, guilty of violating both state and federal versions of the False Claims Act.
As detailed in the initial 2017 complaint, J&J was accused in part of promoting Prezista as “lipid-neutral” between 2006 and 2014, despite the “significant negative effect” on lipids detailed in the drug’s FDA-approved label. The plaintiffs also alleged that the Big Pharma had claimed its Intelence was safe and effective for once-daily dosing and in treatment-naive patients, even though the drug was formally approved only as a twice-daily therapy for treatment-experienced patients.
The jury last summer ultimately found Janssen liable for submitting 159,574 claims violating the False Claims Act, calculating damages of $120 million to the federal government and $30 million to the group of states that had joined the lawsuit.
In last week’s decision, Quraishi sided with J&J’s post-trial filing claiming that the plaintiffs hadn’t sufficiently established the company’s liability in terms of violating False Claims Acts in 27 states, and he therefore threw out that $30 million in damages.
However, the judge did uphold the federal penalty. He cited past rulings that defendants in False Claims Act cases are liable to pay triple the amount of damages that the government sustained because of their alleged acts, and so raised the total to $360 million.
The judge was also tasked with determining the amount of civil penalties that J&J must pay with the law mandating a fine of between $5,500 and $11,000 per false claim. The plaintiffs asked for a $9,000 fine per claim, while J&J requested that the total civil penalties match up only with the damages finding.
Quraishi landed closer to the plaintiffs’ request: He imposed a fine of $8,000 for each false claim—which, when multiplied by the 159,574 claims, amounts to a total civil penalty of $1,276,592,000.
In reaching that decision, the judge considered factors including the damages caused by the alleged acts and “the egregiousness of the conduct.”
“The Court is convinced that Janssen engaged in a deliberate and calculated scheme that spanned several years and involved the unlawful marketing of its products. The evidence at trial also demonstrated that Janssen was aware of the seriousness of its conduct,” he wrote.
Furthermore, he added, “despite the jury’s verdict, Janssen refuses to accept responsibility for its conduct,” citing the statement J&J sent to Fierce Pharma after the jury decision last summer, in which the company maintained that its marketing of the two drugs “has always been consistent with the FDA approved labels” and expressed confidence that the decision would be “reversed on appeal.”
“While the need for deterrence, possible recidivism, Janssen’s evidenced pattern of misconduct, and its refusal to accept responsibility counsel in favor of the Court imposing a higher civil penalty, the lack of evidence regarding patient harm and general fairness principles counsel against the Court imposing the maximum penalty,” Quraishi concluded, leading to his decision to levy a fee in the middle of the statutory range.
J&J was ordered to pay just over $1.64 billion, including federal damages and civil penalties.
In a statement sent to Fierce Pharma Marketing on Monday, a company spokesperson said, “The court has correctly identified the insurmountable flaws in plaintiffs’ state law claims mandating their dismissal. The Court erred, however, in entering judgment with respect to plaintiffs’ analogous federal claims, which fail as a matter of law because, among other reasons, Johnson & Johnson‘s [Janssen’s] promotion of its life-saving medications always was consistent with the FDA-approved labels, and plaintiffs failed to present any evidence that Johnson & Johnson‘s [Janssen’s] promotion was false, material to or the cause of the Government’s reimbursement decisions. We are confident the remainder of the verdict will be reversed on appeal.”