Forest Labs (FRX) appears to have initially underestimated how much it needed to pay the feds to go away: In 2009, the company said it had set aside $170 million in case it needed to settle a Department of Justice investigation of the kickbacks it paid in its marketing of Celexa and Lexapro, two antidepressants. Today, the company paid $313 million to wrap up the probes. Forest’s management is used to lavish spending, however, as the whistleblower complaints behind the settlement allege. The meat of Forest’s wrongdoing is that the company promoted Celexa for children even though the FDA had specifically rejected the drug for kids, and even though European data showed it was not useful in youths. The company did something similar with Lexapro — one pharmaceutical sales rep recommended crushing up Lexapro into apple sauce in order to make it more palatable to children.
Forest Laboratories Inc. (FRX) will pay $313 million to settle criminal and civil charges that it improperly marketed antidepressants for use in children and distributed an unapproved thyroid drug, the Justice Department announced Wednesday….The settlement also covers civil charges that Forest improperly promoted Celexa and another antidepressant, Lexapro, for pediatric use, which had not been approved by the Food and Drug Administration. Forest’s improper promotion campaign took place from 1998 until at least 2005, the department alleged.