The Arkansas Supreme Court is the epicenter of the latest episode in Johnson & Johnson's Risperdal saga. J&J is appealing the $1.2 billion fine in a Medicaid fraud case, in which a jury found the company had downplayed Risperdal's risks and marketed it for off-label uses. J&J ($JNJ) says the fine is excessive--and there's no doubt it's a hefty penalty. But a diverse set of supporters has filed briefs supporting the lower court's decision, including 35 state attorneys general, 65 Arkansas lawmakers, AARP and former FDA Commissioner Donald Kennedy.
Arkansas Attorney General Dustin McDaniel said his own brief asked the state's high court to uphold the $1.2 billion judgment, calling the fine "consistent with Arkansas law," not to mention the proper penalty given J&J"s "serial violations of state law." His fellow state AGs are supporting the fine, too, with their own brief, because they consider the case significant to their own business of deterring "fraudulent, harmful behavior," McDaniel said.
Besides zeroing in on a state statute that sets a range for appropriate penalties, McDaniel's brief also focuses on a couple of legal issues important to the pharma industry. His and the other friend-of-the-court filings argue that the state's prosecuting of off-label marketing and fraud claims aren't preempted by federal law. In recent years, pharma companies have argued in several different circumstances that federal oversight makes state prosecutions invalid. For instance, some contend that FDA approval preempts state liability lawsuits.
In fact, after the Arkansas ruling was initially announced, J&J appeared to be warming up a preemption defense. "It is our position that an individual state should not penalize a pharmaceutical company for using an FDA-approved package insert or decide for itself whether a company complies with FDA rules," the company said at the time.
Meanwhile, the latest supporting briefs also contend that Janssen's marketing tactics aren't protected by the First Amendment. Free speech protections for off-label marketing have been a hot topic lately, in light of a recent U.S. Supreme Court ruling that sided with a pharma rep on the issue. Drugmakers themselves have made the same argument in lawsuits. Par Pharmaceutical, for instance, sued the FDA, claiming it should be allowed to promote its drug Megace for unapproved uses on free speech grounds.
- read the Arkansas AG's press release
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