Pharmaceutical Fraud

The Atypical Antipsychotic drug pharmaceutical class now represents the 3rd largest drug class expenditure in the US, with sales at $18.2 billion in 2011. Members of this drug class include risperidone (Risperdal; Janssen), olanzapine (Zyprexa; Lilly), quetiapine (Seroquel; AstraZeneca), ziprasidone (Geodon; Pfizer), aripiprazole (Abilify; Squibb/Otsuka), and paliperidone (Invega; Janssen).

FDA approved indications for these drugs are limited to: schizophrenia, autism, Tourette’s, and bipolar disorder. In patients < 21 years of age today 70% of the prescriptions for these drugs are for off-label indications: ADHD, conduct disorders unrelated to ADHD, anxiety, depression, substance abuse, adjustment disorders, and miscellaneous mental health diagnoses not included above.

Among elderly, nursing home residents use of these drugs extends to nearly 30% of residents, and virtually 100% of these patients receive the drugs for off-label purposes: common off-label indications included dementiabehavioral disorders, confusion, delirium, aggression, agitation, irritability, disinhibition, anxiety, and wandering behavior.

These drugs have potentially serious side effects, including increased risk of diabetes and sudden death. However, compared to earlier generations of anti-psychotics (especially the phenothiazines), these drugs are fairly safe.

The Centers for Medicare and Medicaid Services have a clear interest in controlling the cost and utilization profiles for this drug class for the following reasons:

  • Most of the adolescent prescribing is for Medicaid beneficiaries, who have a high prevalence of social behavioral disorders;
  • Most of the nursing home prescribing impacts Medicare or Medicare-Medicaid dually eligibles.

This ubiquitous off-label utilization and associated costs are openly acknowledged and discussed in the behavioral health literature. Psychiatric literature openly discusses this drug class and its massive growth outside of FDA approved indications.

Indeed several of the industry players in this field, who are among the largest in the world in all of pharmaceutical sales, are under investigation for actively encouraging the continued off-label utilization. Eli Lilly has already entered into settlement agreements with the United States, and paid a total of $1.415 billion to resolve, inter aliawhistleblower civil and criminal allegations concerning the off-label marketing of the anti-psychotic drug Zyprexa. This is the first of many…stay tuned, for their will be plenty of more Medicare Fraud recoveries in this area.

REAL PEOPLE making real change Pharmaceutical Fraud Wins

Kathleen Hawkins

Dignity Health
$37 million

Kathleen Hawkins, RN MSN, had been employed by Defendant, Catholic Healthcare West (CHW) for approximately 6 years when she decided she had had enough of trying to change the hospital system from within.

CHW, a California not-for-profit corporation that operated hospitals in California, Arizona, and Nevada, was at the time the eighth largest hospital system in the nation and the largest not-for-profit hospital provider in California.


Joe Strom

Johnson & Johnson
$184 Million

Joe Strom contacted us in 2005. We were very grateful that he did. We immediately formed an all-star legal team and a process to stop a very harmful pharmaceutical marketing strategy. It was this process we set into motion that ultimately returned hundreds of millions of dollars to the U.S. Treasury, and a portion of that, very well-deserved, into Joe’s bank account.

Joe told us a very troubling story about the off-label promotion of a pharmaceutical drug for patients who already suffered from chronic heart failure.



“I collaborated with Nolan, Auerbach and White on a broad variety of cases where whistleblowers stepped forward to disclose tactics employed by large companies to influence physicians' medical decision-making in patient care. They and their medical consultants, have consistently leveraged biomedical research and best medical evidence to advance patient safety, optimize clinical outcomes, and control precious resource utilization.”

— Fred Polsky M.D.,, Former Medical Director, CMS Zone 7 Integrity Contractor

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