Public Employee Press

Union busts crooked drug firms
“Off-label” fraud costs major pill pusher $40 million

The DC 37 Health and Security Plan will be covered by the $40 million settlement of a nationwide class-action lawsuit against the manufacturer of a drug improperly used to treat depression among children and adolescents.

The suit charged that the giant drug maker Glaxo inappropriately marketed Paxil for depression involving patients under 18, an “off-label” use not approved by the U.S. Food and Drug Administration, and defrauded prescription drug plans by hiding data that showed an increased risk of suicidal behavior among youngsters using Paxil.

The DC 37 plan has joined two other union benefit funds in filing a formal objection charging that the settlement’s claims process is too burdensome and complicated for the plans to actually receive compensation.

Attorney Audrey Browne, director of regulatory compliance at the DC 37 plan, worked on the objection along with the other unions and Prescription Access Litigation, a coalition of consumer groups fighting illegal drug price manipulation and deceptive marketing. Together, the funds represent 320,000 union members, retirees and their families.

“We don’t expect our share of the settlement to be especially large,” Browne said. “But we have sent the important message here that union drug plans and consumer groups will not tolerate fraudulent practices by the pharmaceutical industry.”

“Manufacturers that improperly market drugs must be forced to compensate victimized plans and patients,” said DC 37 Health and Security Plan Administrator Cynthia Chin-Marshall. She said the plan has a number of lawsuits pending against drug firms and would continue these efforts.