A $67 Million Fine for False Claims on Erlotinib

The Department of Justice has announced that Genentech and OSI Pharmaceuticals “will pay $67 million to resolve False Claim Act allegations that they made misleading statements about the effectiveness of the drug Tarceva to treat non-small cell lung cancer.” Tarceva, the product name for erlotinib. Both companies copromote erlotinib.

Erlotinib was first approved more than a decade ago for the treatment of patients with advanced non-small cell lung cancer (NSCLC), following failure on at least 1 prior chemotherapy treatment. It is now approved as first-line treatment of NSCLC in patients with a L85R mutation in the epidermal growth factor receptor (EGFR); the FDA recently approved the first-ever blood-based companion diagnostic test for erlotinib for patients with NSCLC. Erlotinib is also approved as maintenance treatment in patients with advanced NSCLC who have not progressed after platinum-based first-line chemotherapy. The FDA has also approved the drug for use in combination with gemcitabine in patients with advanced stage pancreatic cancer.

“Pharmaceutical companies have a responsibility to provide accurate information to patients and health care providers about their prescription drugs,” said principal deputy assistant attorney general Benjamin C. Mizer, who heads the Justice Department’s Civil Division. “The Department of Justice will hold those companies accountable that mislead the public about the efficacy of their products.”

The whistleblower case includes allegations that between January 2006 and December 2011, Genentech and OSI Pharmaceuticals made misleading representations to physicians and other healthcare providers about the effectiveness of erlotinib to treat certain patients with NSCLC, when there was little evidence to show that the drug was effective to treat those patients unless they also had never smoked or had a mutation in EGFR. The complaint also states that the company failed to report all the adverse events associated with the drug.

The whistle blower in the case was a former product manager at Genentech, Brian Shields,

“This settlement demonstrates the government’s unwavering commitment to pursue violations of the False Claims Act and recover taxpayer dollars spent as a result of misleading marketing campaigns,” said US attorney Brian Stretch for the Northern District of California. The fine will be distributed between the federal government ($62.6 million), state Medicaid programs ($4.4 million), and Shields ($10 million).