October 31, 2006
InterMune to pay $36.9 million to settle off-label promotion charges
InterMune has agreed to pay federal and state governments more than $36.9 million to settle charges it illegally promoted its immune systems disorder drug Actimmune. The federal government charged the biotech firm with the off-label promotion of Actimmune to treat lung scarring caused by a condition known as idiopathic pulmonary fibrosis. As a result, InterMune knowingly caused the submission of fraudulent claims for reimbursement, US Justice Department officials said. InterMune will pay $30.2 million for losses suffered by the federal portion of the Medicaid program, the Medicare programs, the Veteran’s Administration and Federal Employees Health Benefits program. Under separate civil settlement agreements, the company will also pay nearly $6.7 million to state Medicaid programs. InterMune is expected to enter into an agreement with the federal government to defer prosecution for two years, contingent upon InterMune’s past and future cooperation in the investigation and efforts to implement changes to its compliance policies. The settlement followed a two-year investigation conducted by the federal government into the promotion of Actimmune. In March 2004, a former InterMune sales rep filed a wrongful termination suit against InterMune. The rep alleged that InterMune required the sales force to market Actimmune for unapproved indications and structured compensation systems based on unlawful marketing.