J&J to Pay $158M in Risperdal Whistleblower Lawsuit

By Matt O'Donnell

(LEGAFI) -- Johnson & Johnson has reached a $158 million settlement with the state of Texas and a Pennsylvania whistleblower to settle claims it used false marketing tactics to help influence Texas officials to spend millions of dollars on the schizophrenia drug Risperdal, resulting in overcharges to the state’s Medicaid program.

Texas Attorney General Greg Abbott and Pennsylvania whistleblower Allen Jones sued Johnson & Johnson’s Janssen division in 2004 based on claims that Janssen engaged in a systematic and wide-ranging scheme to convince Texas Medicaid officials to give preferential treatment to the company's Risperdal medication. Mr. Jones uncovered the arrangement during his work as an investigator in the Pennsylvania Office of Inspector General.

The Risperdal whistleblower lawsuit claimed the schizophrenia drug was not better and no safer than alternative medications that treat the same illness, despite having a much higher price tag. The lawsuit claims Janssen sought more revenue by purposefully marketing the powerful antipsychotic drug for use in children, even though the medication was approved only for treating adult schizophrenia.

The whistleblower lawsuit also alleged the company offered trips and kickbacks to state health officials.

"We are proud to have aided the courageous efforts of Allen Jones, a man who helped shine a light on the dark and corrupt practices that impacted taxpayers across Texas," said Jones’ lead counsel in a statement. "He uncovered a terrible effort to push a mind-altering drug on children at the most vulnerable time in their lives."

The Risperdal settlement was reached during the middle of testimony from a psychiatrist and Harvard Medical School instructor who testified that Janssen representatives hid three studies where Risperdal patients developed diabetes even though the company denied that the medication caused the disease.