Summary
Eli Lilly and Company (LLY) filed an 8-K on February 5, 2009, reporting the resolution of a significant government investigation concerning the past marketing and promotional practices of its antipsychotic medication, Zyprexa. The company entered into a Plea Agreement, agreeing to plead guilty to one misdemeanor violation of the Food, Drug, and Cosmetic Act for off-label promotion of Zyprexa in elderly populations for dementia, including Alzheimer's dementia, between 1999 and 2001. As part of this plea, Lilly agreed to pay $615 million.
Key Highlights
- 1Resolution of government investigation into Zyprexa marketing and promotion practices.
- 2Company agreed to plead guilty to a misdemeanor violation of the Food, Drug, and Cosmetic Act.
- 3The misdemeanor plea is specifically for off-label promotion of Zyprexa in elderly populations for dementia between September 1999 and March 2001.
- 4Total payment associated with the Plea Agreement is $615 million.
- 5A separate Settlement Agreement resolves the federal government's civil investigation, with total payments of nearly $800 million ($438 million to the federal government and $362 million to settling states).
- 6Company entered into a Corporate Integrity Agreement with the U.S. Department of Health and Human Services for five years, focusing on compliance program maintenance and oversight.
- 7The Corporate Integrity Agreement requires independent third-party review of Lilly's compliance systems.