The Daily Record, by Michael L. Diamond
November 22, 2011

Allen Jones was curious.

Why did Pennsylvania use a computer program that often pointed to a Johnson & Johnson drug over other, cheaper medicine to treat certain mental illnesses, the investigator for the Keystone State’s Office of Inspector General wanted to know (article continued below video)

Video: Whistleblower Allen Jones on pharmaceutical ties to nation wide efforts to screen children for ‘mental disorders’

(Cont…) While the computer program mandated doctors use a new line of anti-psychotic drugs, including Risperdal, sold by J&J’s subsidiary Janssen companies, Jones said he couldn’t find government-funded medical studies showing that these new drugs were any more effective than their generic predecessors.

Jones’ 2002 inquiry into the drug added to a chain of events that ultimately led Texas to sue New Jersey-based health care giant Johnson & Johnson on claims it orchestrated a multimillion-dollar violation of the Texas Medicaid Fraud Prevention Act.

Jones said in an interview that it was his belief that the company “substituted opinion for science.”

Johnson & Johnson’s sales strategy turned Risperdal, a drug approved by the FDA to treat only schizophrenia and bipolar disease, into a blockbuster that the company sold for those illnesses and, unlawfully, many more, according to the Texas lawsuit.

Risperdal cost substantially more than older, generic drugs and generated more than $25 billion for the company before its patent expired in 2007, according to court records. But the drug often was no more effective at treating mental disorders than older drugs, the National Institute of Mental Health found. Because Medicare and Medicaid paid many of the bills, it cost taxpayers millions, according to federal and state lawsuits.

Twelve states, including Pennsylvania and Texas, have sued Janssen to recover some of the money they spent on Risperdal. South Carolina and Louisiana each were awarded more than $250 million last year. The case brought by Pennsylvania, where Jones first made his discovery, was dismissed in June 2010 after a state judge ruled prosecutors didn’t provide enough evidence. West Virginia lost its case on appeal. The cases in Louisiana and Pennsylvania have been appealed. The company said it intends to appeal the case in South Carolina. Texas and the seven remaining cases are awaiting trial.

The U.S. Justice Department also is investigating the marketing of Risperdal. J&J said in an August filing with the U.S. Securities and Exchange Commission that it is negotiating a settlement and has agreed, “in principal,” to plead guilty to a misdemeanor for violating the Food, Drug and Cosmetic Act. No plea has been made yet.

New Jersey hasn’t filed a lawsuit. It isn’t clear how much the state spent on Risperdal in the last 10 years. New Jersey’s Division of Medical Assistance and Health Services refused to provide the information unless the Asbury Park Press paid a $5,071 processing fee. The Press declined to pay the fee.

The Risperdal legal dispute is an example of a problem that is endemic in the pharmaceutical industry, some doctors say. Government-funded studies about the drug’s effectiveness weren’t published until more than a decade after the drug was first approved.

In the case of Risperdal, “we’re spending money on a drug that isn’t superior and might be inferior to other drugs that cost a fraction as much,” said Dr. John David Abramson, a health care policy expert at Harvard University and author of “Overdosed America,” who investigated the drug for Louisiana’s lawsuit.

“It ought to make honest citizens … want to throw up to see that this money is being extracted from society for no gain, when our country is headed toward financial ruin,” Abramson said.

Whistle-blower fired

Allen Jones, the Pennsylvania investigator, was fired in 2004 after going public with his claims, but he continued to investigate, eventually becoming a plaintiff and whistle-blower in a Texas state lawsuit against Janssen. That trial is scheduled to start Jan. 9.

Risperdal was approved by the FDA in 1993 to treat patients with schizophrenia and, a decade later, patients with bipolar disorder. Janssen, on its website, also says the drug can help treat some symptoms of autism in children and adolescents.

With it came the chance for Janssen to replace Haldol, an anti-psychotic drug that Belgian scientist Paul Janssen himself helped develop in the 1950s, just before Johnson & Johnson bought his company in 1961.

Older anti-psychotic drugs had been available in generic form for decades. Risperdal and a new generation of anti-psychotics came to market in the 1990s at a cost that far exceeded the older drugs, according to the Texas lawsuit.

J&J said Risperdal not only would be safer and more effective than the first generation of anti-psychotic drugs, but also could treat mental disorders other than schizophrenia and bipolar disorder, according to the Texas lawsuit.

Janssen’s medical studies weren’t conclusive enough for the FDA to claim Risperdal was more effective than either Haldol and its generic versions or the new anti-psychotic medicine on the market, the Texas lawsuit said.

Unable to tout Risperdal’s superiority, Janssen got the message to doctors anyway, according to legal documents and interviews. The methods included:

Middlemen. Johnson & Johnson teamed with Omnicare, the nation’s largest pharmacy manager for long-term care facilities, to ensure Omnicare’s pharmacists would recommend Johnson & Johnson’s drugs, according to a lawsuit against J&J filed in Massachusetts in 2010 by the U.S. Justice Department.

Omnicare cared for 1.4 million clients in 47 states. Its annual purchases of Johnson & Johnson drugs climbed from $100 million in 1999 to $280 million in 2004. And its purchases of Risperdal alone exceeded $100 million a year, according to the lawsuit.

The lawsuit claims J&J paid Omnicare tens of millions of dollars in grants, rebates, sponsorships and educational funding — payments that the federal government considered kickbacks.

A substantial portion of the prescriptions were paid by taxpayers through Medicaid, the government said. (Omnicare in 2009 agreed to pay $98 million and settle separate charges by the U.S. that it took kickbacks from J&J. The company didn’t admit wrongdoing).

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