J&J Gets $257 Million Louisiana Risperdal Verdict Thrown Out

Johnson & Johnson (JNJ) persuaded a Louisiana appeals court to throw out a $257.7 million verdict holding the drugmaker liable for deceptively marketing the anti-psychotic medicine Risperdal to doctors across the state.

Louisiana officials didn’t present enough evidence to show J&J violated the state’s healthcare-assistance laws with an advertising campaign touting Risperdal’s performance and safety, the state’s Supreme Court ruled.

The Louisiana case was carved out of a $2.2 billion settlement of U.S. criminal and civil probes of J&J’s Risperdal marketing campaign announced in November. J&J’s Janssen unit pleaded guilty to misbranding the anti-psychotic medicine. The plea was tied to the company’s effort to market the drug to elderly dementia patients without U.S. Food and Drug Administration approval.

In 2010, a judge ordered J&J’s Janssen pay $73 million in addition to the penalties to cover the state bill for attorneys’ fees and case costs.

The state’s lawyers couldn’t produce evidence showing J&J’s “misleading statements” duped doctors into prescribing Risperdal even though competing drugs were “equally safe and less expensive,” the justices wrote.

“Since this lawsuit was filed, we have maintained that we did not violate Louisiana’s Medical Assistance Programs Integrity Law (MAPIL),” Pamela Van Houten, a Janssen spokeswoman, said in an e-mailed statement. “We are gratified to have our position validated by today’s decision.”

Sales Decline

Risperdal’s global sales peaked at $4.5 billion in 2007 and declined after the company lost patent protection. The drug generated $3.4 billion in sales in 2008, or 5.4 percent of the drugmaker’s total revenue.

In the Louisiana case, officials contend Janssen executives sent out misleading letters to doctors in the state downplaying Risperdal’s links to diabetes and improperly claiming the drug was safer than competing medicines, such as Eli Lilly & Co. (LLY)’s Zyprexa and AstraZeneca LP (AZN)’s Seroquel.

That prompted the state’s Medicaid program to pay out more than $42 million for more than 1.6 million Risperdal prescriptions written in 2003 and 2004, according to the state’s court filings.

The case is Caldwell v. Janssen Pharmaceutical Inc., Civil Action 2012-C-2466, Supreme Court of Louisiana (Baton Rouge).

To contact the reporter on this story: Jef Feeley in Wilmington, Delaware at jfeeley@bloomberg.net

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net

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