Avanir Settlement Agreement

On October 8, 2021, Avanir Pharmaceuticals announced that it had reached a settlement agreement with the U.S. Department of Justice (DOJ) to resolve allegations of kickback and off-label promotion of its drug Nuedexta.

According to the settlement agreement, Avanir agreed to pay a total of $103 million to resolve civil and criminal liability. This includes a criminal fine of $7.8 million, forfeiture of $5.2 million, and payment of $90 million to resolve civil claims under the False Claims Act.

The DOJ alleged that Avanir paid kickbacks to physicians and healthcare providers to induce them to prescribe Nuedexta for uses that were not approved by the U.S. Food and Drug Administration (FDA). The drug was approved by the FDA in 2010 for the treatment of pseudobulbar affect, a neurological disorder that causes uncontrollable laughing and crying.

However, the DOJ alleged that Avanir engaged in a scheme to promote the drug for off-label uses, including agitation and aggression in elderly dementia patients. The DOJ also alleged that Avanir paid kickbacks to physicians and healthcare providers in the form of speaker fees, dinners, and other incentives to promote the off-label use of Nuedexta.

In addition to the financial penalties, Avanir also agreed to enter into a corporate integrity agreement with the U.S. Department of Health and Human Services Office of Inspector General. This agreement requires Avanir to implement compliance measures and submit to regular monitoring and reporting.

Avanir`s settlement agreement with the DOJ is the latest in a series of enforcement actions against pharmaceutical companies for off-label promotion and kickbacks. The DOJ has been cracking down on these practices in recent years, and healthcare companies should take note of the risks and consequences of noncompliance.

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