Regulatory Infraction Costs Malvern Pharmaceutical Firm $193 Million

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While Malvern based Endo Pharmaceuticals, Inc. has been successful marketing branded products to help people live healthier lives, its marketing practices – which stepped outside the bounds of FDA approval – have just cost the company $193 million.

Endo manufactures Lidoderm, a lidocaine patch approved by the U.S. Food and Drug Administration for reducing pain from Shingles. This viral infection of the nerve roots afflicts about 500,000 Americans each year. While most recover, the pain can last for months or years for 20 to 30 percent of patients.

Endo had expanded its efforts to market the effective patches for lower back and chronic pain, while the FDA had only approved their use for the pain associated with Shingles, according to Reuters.

Following a federal investigation led by the state of New York and the U.S. Justice Department, the company is paying $173 million to state and federal authorities, and about $20 million more in criminal penalties and forfeitures in a deferred prosecution agreement, Reuters reported on Feb. 21.

The civil settlement resolves three whistleblower lawsuits pending in federal court filed by two former Lidoderm sales representatives and a physician. The whistleblowers’ share of the settlement has not been determined.

“Illegally marketing drugs off-label puts patient lives at risk,” Eric Schneiderman, New York attorney general said in a statement.

Endo also said in a news release it has entered into a five-year compliance and corporate integrity agreement with the U.S. Department of Health and Human Services.

“The company takes its responsibility to patients, healthcare providers and our shareholders very seriously,” said Rajiv De Silva, Endo’s president and chief executive officer. “We are pleased to resolve this matter and are confident that we have robust programs in place to assist us in satisfying our legal and regulatory agreements. We are committed to a company culture that supports the conduct of our business in a compliant and ethical manner.”

Endo Pharmaceuticals, Inc. develops branded pharmaceutical products in the areas of pain management, urology and endocrinology.

For more information on Endo’s decision to pay the FDA fine check out ABC News here or MSN Money here.

(Above image of Endo Pharmaceutical’s Malvern headquarters is courtesy of Region’s Business)

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