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Prescription Drug Settlements


Drug manufacturers that ignore the law or market dangerous medications can be slapped with hefty fines from the government — at the same time they are facing hundreds or thousands of lawsuits from injured consumers.

At one time, patients trusted their doctors’ advice and faithfully took the medicines they prescribed without question. But today, savvy consumers have to be on guard. Because of widespread health care fraud, they must question physicians’ motives when it comes to their personal well-being and their financial health. After all, patients may be given a more expensive drug or one associated with more risks just because the doctor receives a payment for promoting that medication.

Bending health care laws has become so commonplace that drug manufacturers — the source of physician payments and other deceptive practices — consider any punishment to be the cost of doing business. To them, it seems the increased profits outweigh the risk of getting caught or any damage they inflict on unsuspecting patients.

But those companies are breaking the law, and the U.S. government is not willing to turn a blind eye to health care fraud. It has cracked down on drug manufacturers that market their products for uses not approved by the U.S. Food and Drug Administration (FDA) and those that try to inflate drug prices for their own gain.

Manufacturers that sell dangerous medications can face government fines, as well as lawsuits from injured consumers. Experienced attorneys recognize that the only message these companies understand are ones that affect their pocketbook.

The manufacturers of popular drugs all have had to pay the price for their dangerous actions at one time or another.


If you were harmed by a dangerous drug or a defective medical device, you may have legal options.

Prescription Drug Settlements


Abilify is a second- generation antipsychotic prescribed to treat bipolar disorder and schizophrenia. Unlike other drugs in its class, Abilify stabilizes both dopamine and serotonin levels. Doctors often prescribed it alongside other antidepressants. However, studies linked it to compulsive behaviors, like binge eating and compulsive gambling. Its manufacturer, Bristol-Myers Squibb, settled federal charges of illegal marketing for $515 million after it tried to market the drug for unapproved uses in children and elderly patients.


Accutane, which is made from vitamin A, was approved for the treatment of severe acne in 1982. The Roche Holding product works by reducing the amount of oil released by glands in the skin. Accutane has triggered many lawsuits and multi-million dollar settlements because it has been associated with Irritable Bowel Syndrome (IBS), Crohn’s disease, gastrointestinal disorders, liver damage and severe birth defects. The company voluntarily pulled Accutane from the market in 2009, citing business concerns. One of the top monetary judgments to date was for more than $25 million.


Actos is a Type 2 diabetes drug that decreases insulin resistance and the amount of glucose made in the liver in order to allow the body to dispose of excess blood sugar more easily. However, studies linked it to several severe side effects like increased risk of bladder cancer, congestive heart failure, chronic kidney disease and lactic acidosis. The drug’s manufacturer Takeda Pharmaceuticals settled lawsuits claiming the drug caused bladder cancer for $2.37 billion.


Avandia, a diabetes drug manufactured by GlaxoSmithKline, has been linked to as many as 100,000 heart attacks since it received FDA approval in 1999. Despite clinical trials that showed increased heart risks related to the drug, the FDA did not add a black-box warning to Avandia until 2007. Sales of the drug have since been severely restricted.

GlaxoSmithKline paid out at least $750 million to settle more than 50,000 Avandia lawsuits and has set aside more than $6 billion for all litigation and settlements related to the drug.

In July 2012, GlaxoSmithKline agreed to pay $3 billion to settle charges brought by the U.S. Department of Justice. The government charged the drug manufacturer with failing to report clinical data on Avandia, to which GlaxoSmithKline pleaded guilty. In addition, the company was charged with improper marketing of Paxil and Wellbutrin.

Azmacort, Nasacort and Nasacort AQ nasal sprays

Azmacort, Nasacort and Nasacort AQ are all steroid-based anti-inflammatory nasal sprays used to treat nasal congestion during the onset of a sinus infection, the common cold or hay fever. Their manufacturer, Aventis Pharmaceutical, which is a subsidiary of Sanofi-Aventis, agreed to $95.5 million in fines after the company was found to have misreported the drugs’ best prices, thereby avoiding paying millions of dollars in rebates to Medicaid between 1995 and 2000.


Benicar is used to treat high blood pressure by helping keep blood vessels dilated (open). However, the FDA eventually issued black box warnings warning of severe gastrointestinal side effects and fetal toxicity when taken by women who are pregnant. The drug’s manufacturer Daiichi Sankyo settled a case against the U.S. Department of Justice claiming it violated the False Claims Act for $39 million.


Bextra is a selective COX-2 inhibitor, which is a type of non-steroidal anti-inflammatory drug (NSAID) used to treat chronic pain, such as arthritis or a back injury. Bextra is manufactured by Pharmacia & Upjohn Co., a subsidiary of Pfizer Inc. Pfizer faced a $2.3 billion fine in 2009 for promoting off-label use of Bextra and three other drugs — Geodon, Zyvox and Lyrica — through marketing materials, talking points for drug representatives and ghostwritten articles. Pfizer also was accused of providing kickbacks to physicians who prescribed the four medicines.


At the time of manufacturer Allergan’s $600 million fines and penalties in 2010, Botox was only approved for temporary removal of facial wrinkles. Botox is a toxin produced by the bacterium Clostridium botulinum and is delivered to the body via injection. Allergan was found guilty of promoting off-label use of Botox for headaches, pain management and cerebral palsy. Since then, Botox has been approved for treating migraines, stress urinary incontinence (SUI) in people with neurologic conditions, muscle stiffness and contraction, severe underarm sweating, abnormal twitch of the eyelid and misaligned eyes.

Celexa, Lexapro and Levothroid

Celexa, Lexapro and Levothroid, all manufactured by Forest Laboratories, treat different conditions but were linked together in a $313 million penalty the manufacturer was forced to pay the U.S. government in 2010. Celexa is an antidepressant approved only for use in adults, but Forest promoted it as a safe drug for children and adolescents suffering from depression. The company distributed Levothroid when it was not yet approved by the U.S. Food and Drug Administration (FDA), and all three drugs were linked to false claims submitted to federal health care programs.


Depakote is an anti-seizure drug that the FDA also approved to treat bipolar disorder and to prevent migraines. It works by increasing the amount of a special neurotransmitter in the brain, but studies linked its use to suicide, liver toxicity, pancreatitis and birth defects. Its manufacturer Abbott settled a case for $3 million in Arkansas for illegally promoting it to treat schizophrenia and autism, and it settled a $1.5 billion case for illegally promoting it to elderly dementia patients.


Fosamax is used to prevent osteoporosis and bone fractures mostly in postmenopausal women by slowing bone loss while increasing bone mass. Lawsuits have arisen because the Merck & Co. drug has been linked to serious side effects, including esophageal cancer, disfigurement of the jaw and femur fractures. In 2012, Merck was fighting about 1,000 federal lawsuits over osteonecrosis of the jaw (ONJ) that had been consolidated into a multidistrict litigation (MDL) and about 200 additional cases in state courts. Early reports in 2013 indicated the company would settle 1,140 lawsuits for $27.7 million, but the company never officially released the amount of the settlement when it became official in 2014.


In July 2012, GlaxoSmithKline paid the largest health care fraud settlement in U.S. history and the largest payment ever by a drug company at $3 billion. The drug manufacturer pleaded guilty to federal charges of misbranding two antidepressants, Paxil and Wellbutrin, and failing to report safety information about Avandia, which is used to treat type 2 diabetes, to the FDA. GlaxoSmithKline previously was in hot water over promoting off-label uses of its nine best-selling drugs in Colorado and had to pay the state $400 million in 2009.


Pradaxa is a blood-thinner that helps prevent strokes and blood clots. However, it does not have an antidote and thousands of people claimed it caused uncontrollable bleeding and hemorrhaging sometimes resulting in death. Its manufacturer Boehringer Ingelheim settled thousands of cases for $650 million.


Risperdal is an antipsychotic used to treat schizophrenia and bipolar disorder in adults and adolescents and autism spectrum disorders in children and adolescents. However, its manufacturer was accused of hiding some of its dangerous side effects like diabetes, substantial weight gain, stroke and gynecomastia – or breast development in boys. Its manufacturer Johnson & Johnson settled claims in Kentucky, Texas and Montana for a total of more than $340 million and settled multiple cases in Pennsylvania for undisclosed amounts.


Seroquel is a second-generation anti-psychotic drug used to treat schizophrenia and bipolar disorder. Manufacturer AstraZeneca was accused of promoting the drug for unapproved uses, such as the treatment of insomnia and Alzheimer’s disease. In 2010, the company paid a $520 million fine for marketing Seroquel off  label. By 2011, AstraZeneca paid $647 million to resolve global lawsuits claiming Seroquel causes diabetes.


Topamax has been approved by the FDA to treat epilepsy in adults and children and migraines in adults. The manufacturer, two subsidiaries of health care giant Johnson & Johnson, were found guilty of marketing the drug for unapproved treatments, such as weight loss and bipolar disorder. The Department of Justice fined Ortho-McNeil Pharmaceutical and Ortho-McNeil-Janssen Pharmaceuticals more than $81 million in 2010 for this dangerous practice.


TriCor is Abbott Laboratories’ high-selling cholesterol drug that the company was accused of protecting against generic versions by continually revising its formula, and thus creating an illegal monopoly. Abbott and its partner, Fournier Industrie et Sante, were ordered to pay $22.5 million to 23 states in 2010 to settle claims from pharmacies, wholesalers and generics makers.


Trileptal is an anti-convulsant and mood-stabilizer that is used to treat epilepsy and bipolar disorders. The drug was designed to subdue partial seizures, or ones that begin in a limited part of the brain. However, manufacturer Novartis marketed Trileptal and five other drugs — Diovan, Exforge, Sandostatin, Tekturna and Zelnorm — for treatments not approved by the FDA, including relieving psychiatric symptoms and pain. The false promotions led to false claims in federal health care plans. Novartis also was accused of paying kickbacks to physicians who prescribed the six drugs. Novartis plead guilty to a misdemeanor and paid $185 million in 2010.


Vioxx was a popular selective COX-2 inhibitor with anti-inflammatory properties used to treat chronic pain. Vioxx, however, was found to increase the risk of heart attack and stroke in certain patients who took the drug for more than 18 months, so manufacturer Merck & Co. voluntarily recalled it in 2004. Within a year, claims were filed, and eventually 50,000 cases joined an MDL based in New Orleans. The company agreed to settle the cases without admitting fault, setting aside $4.85 billion.


Vytorin, which combines brand-name pills Zocor and Zetia, is a popular cholesterol drug from manufacturers Merck and Schering-Plough. In 2009, the ENHANCE study found that Vytorin was no more effective than the older, less expensive cholesterol drugs. Merck and Schering-Plough were accused of delaying the publication of study results for their financial gain and ended up paying $5.4 million in state fines without admitting they were at fault.

Yaz and Yasmin

Bayer Pharmaceuticals is facing more than 12,000 lawsuits over two birth control pills, Yaz and Yasmin. Thousands of women have been injured and dozens have died from blood clots, strokes or other serious side effects associated with these contraceptives. The FDA added a black-box warning to the product labels in 2008, just two years after the pills hit the market.

Federal cases against Bayer have been transferred to the U.S. District Court for the Southern District of Illinois. Bayer has paid more than $1.6 billion to settle more than 7,600 Yaz and Yasmin claims so far.


Zofran is an anti-emetic which treats nausea and vomiting. It was not approved for women who are pregnant, but women who took it for morning sickness claim it led to birth defects. Its manufacturer GlaxoSmithKline settled a case against the U.S. Department of Justice which claimed the company promoted it to pregnant women for $3 billion.


Zonegran is an epilepsy drug also used to treat partial seizures in people older than 16. It is designed to be used in combination with other epilepsy medicines. In 2010, manufacturer Elan Corporation received a $203.5 million fine from the federal government for its marketing of Zonegran for a variety of unapproved uses, such as psychiatric disorders, movement disorders, obesity or weight loss, pain management and headaches. These off-label uses then triggered false health care claims.


Zyprexa, which was approved by the FDA in 1996, is an anti-psychotic drug used to treat schizophrenia and bipolar disorder and is manufactured by Eli Lilly & Co. It has been the subject of multiple lawsuits and large settlements because of the ways in which it was marketed. Eli Lilly was accused of downplaying the side effects of its top-selling drug while promoting it for unapproved uses, such as the treatment of dementia.  As such, the company agreed to plead guilty to the misdemeanor of violating the Food, Drug and Cosmetic Act in 2009 and paid $615 million in criminal fines. Eli Lilly also paid $800 million to settle related civil lawsuits on both the state and federal levels.

Price-Fixing Settlements

Pharmaceutical companies also have been accused of illegally inflating drug prices in order to increase their profits. Some of the above settlements included this type of health-care fraud, and other large payouts are listed below.

In the most recent case, McKesson Corp. chose to settle claims that it inflated drug prices by as much as 25 percent, which triggered overpayments by Medicaid. The $151 million settlement announced July 27, 2012, is divided among 29 states. Federal and state investigations uncovered the price increase in more than 1,400 brand-name medications, including Adderall, Allegra, Ambien, Celexa, Lipitor, Neurontin, Prevacid, Prozac and Ritalin, according to the Chicago Tribune. McKesson did not admit fault.

In 2010, Abbott Laboratories, B. Braun Medical and Roxane Laboratories agreed to pay $421 million to resolve claims they had reported false and inflated prices for their drugs, which again affected federal health care reimbursements. The grossly inflated average wholesale price (AWP) caused Medicare and Medicaid programs to spend more per patient than was necessary, thereby reducing the amount of funding available for all patients in need. The drug manufacturers did not admit fault.

In 2007, Bristol-Myers Squibb and a subsidiary paid $515 million to settle allegations of illegal pricing and marketing of its drugs from 1994 through 2005. Among the misreported prices were those for antidepressant Serzone, plus various oncology and generic drugs.

As an incentive to correct health care fraud, company whistleblowers are rewarded with a portion of the settlement. According to The New York Times, such internal reports account for two-thirds of the payouts in the last 10 years.