DOJ: News Release

McGrath: Drug Company Reimburses State $157,000 in Medicaid Fraud Settlement

HELENA – The State has received nearly $157,000 in Medicaid restitution and penalties as part of a settlement recently negotiated between the National Association of Medicaid Fraud Control Units, the federal government and pharmaceutical manufacturer Cephalon, Inc.

Cephalon will pay $425 million to federal and state Medicaid programs as part of a national agreement that resolves allegations of improper “off-label” marketing of three drugs. “Off-label” describes a use of a medication other than the use for which the drug is approved. Although doctors may prescribe drugs for off-label purposes, it is illegal for manufacturers to promote those off-label uses.

The pharmaceutical company had allegedly marketed the following drugs for uses other than what the Food and Drug Administration had approved:

  • Provigil: approved to treat only narcolepsy and sleep disorders; marketed as a non-stimulant drug to treat sleepiness, tiredness, lack of energy and fatigue.
  • Gabitril: approved as a partial treatment for seizures; marketed as a remedy for anxiety, insomnia and pain. Following reports of seizures in patients taking Gabitril who did not have epilepsy, the FDA required Cephalon to send a warning to physicians advising them of the risks of seizures related to off-label use of the drug.
  • Actiq: approved to treat opioid-tolerant cancer patients; marketed for conditions including migraines, sickle-cell pain crises, and other injuries.

Cephalon funded continuing medical education programs, through millions of dollars in grants, to promote these off-label uses.

The $156,928.56 payment to Montana includes:

  • $50,902.47 in state Medicaid restitution
  • $101,804.93 in additional recoveries
  • $4,221.16 in interest

The funds were repaid to the Montana Medicaid program administered by the state Department of Public Health and Human Services. The case was handled by the National Association of Medicaid Fraud Control Units, based on investigations and data from state Medicaid Fraud Control Units.

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