$1B Risperdal marketing suit hits Texas court

As Johnson & Johnson ($JNJ) negotiates its Risperdal marketing settlement with the feds, it's going to court in Texas today to fight $1 billion in potential damages. The whistleblower lawsuit, joined by the state, alleges J&J employed a variety of inappropriate marketing tactics, leading the Texas Medicaid program to overpay for the antipsychotic drug.

Texas Attorney General Greg Abbott alleges a J&J unit pushed Risperdal for off-label uses, touting it as a treatment for elderly patients with dementia and children with psychiatric disorders when the drug wasn't approved for those indications. Abbott says the company overstated Risperdal's safety and efficacy, and it paid state officials to get the product onto state formularies.

The $1 billion in requested damages could lead to a record False Claims Act verdict, one activist told Bloomberg. "It's going to be massive," Taxpayers Against Fraud's Patrick Burns told the news service.

J&J denies any wrongdoing, a spokeswoman told Bloomberg: "We are committed to ethical business practices, and have policies in place to ensure that our products are only promoted for their FDA-approved indication." The spokeswoman added the company acts quickly to investigate any questions about violations of its marketing policies and "take appropriate disciplinary action."

Whatever happens with the Texas case, J&J already faces $660 million in Risperdal judgments, including a $330 million award in Louisiana. The marketing settlement under discussion at the Justice Department would amount to another $1 billion, Bloomberg's sources say, with some $400 million of that stemming from a misdemeanor Risperdal marketing charge. Some states are participating in that settlement, but not Texas, the sources said.

- read the Bloomberg piece