Google Derogatory Notes

Google Derogatory Notes
http://www.justice.gov/opa/pr/2012/May/12-civ-585.html
Department of Justice
Office of Public Affairs
FOR IMMEDIATE RELEASE
Monday, May 7, 2012
Abbott Labs to Pay $1.5 Billion to Resolve Criminal & Civil Investigations of
Off-label Promotion of Depakote
Company Maintained Specialized Sales Force to Market Drug for Off Label Purposes;
Targeted Elderly Dementia Patients in Nursing Homes
Global Health Care Company Abbott Laboratories Inc. has pleaded guilty and agreed to pay
$1.5 billion to resolve its criminal and civil liability arising from the company’s unlawful
promotion of the prescription drug Depakote for uses not approved as safe and effective by
the Food and Drug Administration (FDA), the Justice Department announced today. The
resolution – the second largest payment by a drug company – includes a criminal fine and
forfeiture totaling $700 million and civil settlements with the federal government and the
states totaling $800 million. Abbott also will be subject to court-supervised probation and
reporting obligations for Abbott’s CEO and Board of Directors.
“Today’s settlement shows further evidence of our deep commitment to public health
and our determination to hold accountable those who commit fraud,” said James M.
Cole, Deputy Attorney General. “We are resolute in stopping this type of activity and
today’s settlement sends a strong message to other companies.”
The FDA is responsible for approving drugs as safe and effective for specified uses.
Under the Food, Drug and Cosmetic Act (FDCA), a company in its application to the
FDA must specify each intended use of a drug. A company’s promotional activities
must be limited to only the intended uses that FDA approved. In fact, promotion by
the manufacturer for other uses – known as “off-label” uses – renders the product
misbranded.
Abbott has pleaded guilty to misbranding Depakote by promoting the drug to control
agitation and aggression in elderly dementia patients and to treat schizophrenia when
neither of these uses was FDA approved. In an agreed statement of facts filed in the
criminal action, Abbott admits that from 1998 through 2006, the company maintained
a specialized sales force trained to market Depakote in nursing homes for the control
of agitation and aggression in elderly dementia patients, despite the absence of
credible scientific evidence that Depakote was safe and effective for that use. In
addition, from 2001 through 2006, the company marketed Depakote in combination
with atypical antipsychotic drugs to treat schizophrenia, even after its clinical trials
failed to demonstrate that adding Depakote was any more effective than an atypical
antipsychotic alone for that use.
Illegal Promotion of Depakote to Control Agitation and Aggression in Dementia
Patients
The FDA approved Depakote for only three uses: epileptic seizures, bipolar mania and the
prevention of migraines. The FDA never approved the drug as safe and effective for the off-
label use of controlling behavioral disturbances in dementia patients. In 1999, Abbott was
forced to discontinue a clinical trial of Depakote in the treatment of dementia due to an
increased incidence of adverse events, including somnolence, dehydration and anorexia
experienced by the elderly study participants administered Depakote.
Abbott trained its sales force to promote Depakote to health care providers and
employees of nursing homes as advantageous over antipsychotic drugs for controlling
agitation and aggression in elderly dementia patients because Depakote was not
subject to certain provisions of the Omnibus Budget Reconciliation Act of 1987
(OBRA) and its implementing regulations designed to prevent the use of unnecessary
medications in nursing homes. Exploiting the fact that certain OBRA provisions did
not yet apply to Depakote, Abbott sales representatives stated that by using Depakote,
nursing homes could avoid the administrative burdens and costs of complying with
OBRA.
Abbott’s off-label promotion of Depakote was multifaceted. The company entered

into contracts that provided long-term care pharmacy providers with payments of
rebates based on increases in the use of Depakote in nursing homes serviced by the
providers. In addition to using its sales force to promote the drug to health care
providers and employees of nursing homes, Abbott created programs and materials to
train the pharmacy providers’ consultant pharmacists about the off-label use of
Depakote to encourage them to recommend the drug for this unapproved use. Under
these contracts, Abbott paid millions of dollars in rebates to the pharmacy providers.
“Not only did Abbott engage in off-label promotion, but it targeted elderly dementia
patients and downplayed the risks apparent from its own clinical studies,” said Acting
Associate Attorney General Tony West. “As this criminal and civil resolution
demonstrates, those who put profits ahead of patients will pay a hefty price.”
Illegal Off-Label Promotion of Depakote for Schizophrenia
In the agreed statement of facts, Abbott also admitted that from 2001 through 2006,
the Company misbranded Depakote by marketing the drug to treat schizophrenia.
Abbott funded two studies of the use of Depakote to treat schizophrenia, and both
failed to meet the main goals established for the study. When the second study failed
to show a statistically significant treatment difference between antipsychotic drugs
used in combination with Depakote and antipsychotic drugs alone, Abbott waited
nearly two years to notify its own sales force about the study results and another two
years to publish those results. During this time, Abbott continued to promote
Depakote off-label to treat schizophrenia.
“ Today’s settlement demonstrates our continued scrutiny of the sales and marketing
practices of pharmaceutical companies that put profits ahead of patient health,” said
U.S. Food and Drug Administration Commissioner Margaret Hamburg, M.D. “The
FDA will continue its due diligence and hold pharmaceutical companies accountable
for marketing practices that undermine the drug approval process.”
Criminal Plea
Today’s global resolution has criminal, civil and administrative components. First,
Abbott has pleaded guilty to a criminal misdemeanor for misbranding Depakote in
violation of the FDCA. Under the plea agreement, Abbott will pay a criminal fine of
$500 million, forfeit assets of $198.5 million, and submit to a term of probation for
five years. In addition, Abbott will also pay $1.5 million to the Virginia Medicaid
Fraud Control Unit. As a condition of probation, Abbott will report any probable
FDCA violations to the probation office, its CEO will certify compliance with this
reporting requirement, and its board will report annually on the effectiveness of the
company’s compliance program. In addition, Abbott agrees that during the term of
probation, the company will not compensate sales representatives for off-label sales,
will ensure that continuing medical education grant-making decisions are not
controlled by sales and marketing, will require that letters communicating medical
information to healthcare providers be accurate and unbiased, and will have policies
designed to ensure that clinical trials are approved by the company’s medical or
scientific organizations and published in a consistent and transparent
manner. Abbott’s guilty plea and sentence are not final until accepted by the U.S.
District Court for the Western District of Virginia.
“As the agreed statement of facts filed in court today demonstrates, Abbott promoted
Depakote to control behaviors in elderly dementia and schizophrenia patients without
significant evidence of its effectiveness for that use, and even after clinical data
established that it was not effective,” said Timothy Heaphy, U.S. Attorney for the
Western District of Virginia. “The resolution announced today includes a self-
policing mechanism by which Abbott’s board of directors will monitor compliance
with the law and report any violations, as well as a period of probation and court
supervision. We credit Abbott’s acceptance of responsibility and encourage other
pharmaceutical companies to impose the similar mechanisms to prevent off-label
marketing, which damages health care consumers.”
Civil Settlement
Under the civil settlement, Abbott has agreed to pay $800 million to the federal
government ($560,851,357) and the states ($239,148,643) that opt to participate in the
agreement to resolve claims that its unlawful marketing and illegal remuneration
practices caused false claims to be submitted to government health care programs
such as Medicare, Medicaid, TRICARE and to the Federal Employees Health Benefit
Program, the Department of Veterans’ Affairs and the Department of Labor’s Office
of Workers’ Compensation Programs.
The civil settlement addresses broader allegations by the United States that from 1998
through 2008, Abbott unlawfully promoted Depakote for unapproved uses, including
behavioral disturbances in dementia patients, psychiatric conditions in children and
adolescents, schizophrenia, depression, anxiety, conduct disorders, obsessive-
compulsive disorder, post-traumatic stress disorder, alcohol and drug withdrawal,
attention deficit disorder and autism. . Some of these unapproved uses were not
medically accepted indications for which the United States and state Medicaid
programs provided coverage for Depakote. The United States contends that this
promotion included, in part, making false and misleading statements about the safety,
efficacy, dosing and cost-effectiveness of Depakote for some of these unapproved
uses, and claiming use of Depakote to control behavioral disturbances in dementia
patients would help nursing homes avoid the administrative burdens and costs of
complying with OBRA regulatory restrictions applicable to antipsychotics.
The civil settlement also covers allegations that Abbott offered and paid illegal
remuneration to health care professionals and long term care pharmacy providers to
induce them to promote and/or prescribe Depakote and to improperly and unduly
influence the content of company sponsored Continuing Medical Education programs,
in violation of the Federal Anti-Kickback Statute. The claims settled by the civil
agreement are allegations only and there has been no determination of liability, except
to the extent that Abbott has admitted facts in the civil settlement agreement or in the
criminal plea and agreed statement of facts filed in the criminal action.
The civil settlement resolves four lawsuits pending in federal court in the Western
District of Virginia under the qui tam, or whistleblower, provisions of the False
Claims Act, which allow private citizens to bring civil actions on behalf of the United
States and share in any recovery. As part of today’s resolution, the whistleblowers
will receive $84 million from the federal share of the settlement amount.
Corporate Integrity Agreement
In addition to the criminal and civil resolutions, Abbott has also executed a Corporate
Integrity Agreement (CIA) with the Department of Health and Human Services,
Office of Inspector General (HHS-OIG). The five-year CIA requires, among other
things, that Abbott's board of directors review the effectiveness of the company's
compliance program, that high-level executives certify to compliance, that Abbott
maintain standardized risk assessment and mitigation processes, and that the company
post on its website information about payments to doctors. Abbott is subject to
exclusion from federal health care programs, including Medicare and Medicaid, for a
material breach of the CIA and subject to monetary penalties for less significant
breaches.
“As a result of OIG’s joint investigation with our federal and state partners, Abbott
Laboratories will enter one of the pharmaceutical industry’s largest settlements and
pay $1.5 billion for unlawfully promoting its drug Depakote, including to nursing
home patients with dementia,” said HHS Inspector General Daniel R. Levinson. “Our
integrity agreement will hold Abbott accountable for preventing future violations of
federal health care laws and FDA requirements, which will protect federal programs,
taxpayers and our most vulnerable patients.”
A Multilateral Effort
The criminal case is being prosecuted by the U.S. Attorney’s Office for the Western
District of Virginia and the Civil Division’s Consumer Protection Branch. The civil
settlement was reached by the U.S. Attorney’s Office for the Western District of
Virginia and the Civil Division’s Commercial Litigation Branch. Assistance w as
provided by representatives of the HHS Office of Counsel to the Inspector General;
the Center for Medicare and Medicaid Services (CMS) and Office of the General
Counsel, CMS Division; FDA’s Office of Chief Counsel; and the National
Association of Medicaid Fraud Control Units.
“Crimes involving the misbranding of drugs for financial gain will not be tolerated,” stated
Richard Weber, Chief IRS Criminal Investigation. “The special agents of IRS Criminal
Investigation will use all their investigative tools, including the use of asset forfeiture statutes,
to combat financial crimes and hold corporations accountable for their actions.”
This matter was investigated by the Virginia Attorney General’s Medicaid Fraud
Control Unit; the Internal Revenue Service - Criminal Investigation; the FDA - Office
of Criminal Investigation; the Defense Criminal Investigative Service; the Health and
Human Services - Office of Inspector General; the West Virginia State Police; the
Office of Personnel Management - Office of Inspector General; the Department of
Veterans’ Affairs Office of Inspector General; the Department of Labor - Office of
Inspector General; and TRICARE Program Integrity.
This resolution is part of the government's emphasis on combating health care fraud
and another step for the Health Care Fraud Prevention and Enforcement Action Team
(HEAT) initiative, which was announced in May 2009 by Attorney General Eric
Holder and Kathleen Sebelius, Secretary of HHS. The partnership between the two
departments has focused efforts to reduce and prevent Medicare and Medicaid
financial fraud through enhanced cooperation. One of the most powerful tools in that
effort is the False Claims Act, which the Justice Department has used to recover more
than $7.4 billion since January 2009 in cases involving fraud against federal health
care programs. With the settlement announced today, the Justice Department's total
recoveries in False Claims Act cases since January 2009 will exceed $10.2
billion. During this same time, the department has secured $3.9 billion in criminal
fines, forfeiture, disgorgement, and restitution relating to violations of the FDCA.
Relate Article
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page=19453&content=66839058&pageNum=-1
Abbott Faces More Investigations, Lawsuits Over Depakote

Marketing
Abbott Laboratories (ABT) is facing fresh legal challenges in

connection with its sales and marketing of anti-seizure drug
Depakote.
The Abbott Park, Ill., company last year set aside $1.5 billion to
cover a potential settlement stemming from a Justice
Department-led investigation of allegations that the company
promoted Depakote for unauthorized uses. A final settlement is
pending.
Now, attorneys general in eight states have formed a committee

to investigate whether Abbott's Depakote sale and marketing
violated various state consumer-protection and other laws, the
company disclosed Tuesday.
Also, eight lawsuits have been filed against some current and
former Abbott directors and senior executives in federal and
state courts in Illinois. The so-called shareholder derivative
lawsuits allege breaches of fiduciary duty in connection with
certain business practices surrounding the sales and marketing
of Depakote, Abbott said in its annual report filed with the
Securities and Exchange Commission.
The attorneys general who formed a committee to investigate

Abbott are from Florida, Illinois, North Carolina, Ohio, Oregon,
Pennsylvania, South Carolina and Texas. The committee was also
formed on behalf of attorneys general from other states, which
weren't identified.
Abbott spokesman Scott Stoffel said "these types of follow-on

investigations are not unusual. We are cooperating with the
investigation."
The shareholder derivative lawsuits were filed between

November and January in U.S. District Court for the Northern
District of Illinois and in Illinois state court. Plaintiffs included
several public-employee pension funds.
"We believe the board has acted appropriately at all times," said
Stoffel. "The suits are without merit."
The Justice Department has been investigating whether Abbott

violated civil or criminal laws by marketing Depakote as a
treatment for agitation, aggression in the elderly and other uses
not approved by the Food and Drug Administration. Depakote is
approved to treat epilepsy, migraine headaches and manic
episodes associated with bipolar disorder.
Drug makers are generally barred from actively promoting "off

label" uses of their drugs, though doctors have the discretion to
prescribe off label.
Similar allegations were raised in four lawsuits filed against

Abbott between 2007 and 2010. The lawsuits--brought by former
and current Abbott sales employees at the time they were filed--
say the company's off-label marketing of Depakote beginning in
the late 1990s caused false claims for prescription
reimbursement to be submitted to government health programs,
including Medicaid.
The people who filed the lawsuits may be eligible to receive a

portion of any monetary settlement under federal and state laws
encouraging whistleblowers to report suspected health-care
fraud to the government.
Depakote was once one of Abbott's best-selling drugs, racking up

$1.6 billion in sales for 2007, before patent expirations cleared
the way for cheaper generic competition.
In 2010, a federal judge ordered Abbott to hand over to

prosecutors some of Chief Executive Miles White's email
messages. The U.S. Attorney's Office in western Virginia had
demanded copies of the emails as part of its Depakote probe, but
Abbott had resisted.
A competing epilepsy drug was the subject of an off-label

marketing settlement in 2010. Johnson & Johnson (JNJ) agreed
to pay $81 million and to plead guilty to a criminal misdemeanor
to settle allegations that it promoted Topamax for off-label
psychiatric uses.
Copyright © 2012 Dow Jones Newswires

http://www.chattanoogan.com/2013/12/27/266328/Abbott-Laboratories-To-Pay-5.475.aspx
Abbott Laboratories To Pay $5.475 Million Settlement

For Violation Of False Claims Act
Friday, December 27, 2013
Abbott Laboratories, a global healthcare company, has agreed to pay $5.475 million to
settle alleged violations of the False Claims Act, and other federal laws and regulations in
connection with the operation of its medical device business which manufactures, markets
and supplies carotid, biliary, and peripheral vascular products.
As alleged in the settlement agreement, between 2005 and 2010, through its employees
and a third party continuing medical education providers, Abbott offered physicians paid
teaching and training assignments, consulting arrangements, speaking engagements,
and/or sponsorship grants for physician conferences, for the purpose of inducing
physicians to arrange for or recommend that the hospitals with which they were affiliated
purchase or order Abbott’s carotid, biliary and peripheral vascular products.
These financial arrangements were improper and did not meet the requirements of the
Anti-Kickback Statute – a law designed to protect patients as well as the integrity of
government-funded health care benefit programs such as Medicare, it was stated.
Where the choice of devices used in medical procedures is impacted by such improper
arrangements, suppliers that cause claims for such devices and procedures to be
submitted to Medicare and other federal health care programs violate the False Claims Act,
authorities said.
U.S. Attorney Bill Killian said, “Physicians should make decisions regarding medical devices
based on what is in the best interest of patients without being induced by payments from
manufacturers competing for their business.” Federal law prohibits medical providers from
submitting claims to government-funded health care benefit programs for services and
devices referred, ordered, or arranged for by physicians who received such prohibited
financial inducements.
“Offering financial inducements can distort health care decision-making,” said Derrick L.
Jackson, Special Agent in Charge at the U.S. Department of Health and Human Services,
Office of Inspector General in Atlanta. “OIG and our law enforcement partners vigilantly
protect government health programs from such alleged abuses.” During the period
between 2005 and 2010 hospitals affiliated with the physicians who received such
inducements submitted to the Medicare program claims which included the cost of the
medical devices referred, ordered or arranged for by such physicians. Medicare paid the
claims that included the cost of the medical devices. This settlement addresses the
financial harm to the Medicare trust fund for the moneys paid out of the fund which
resulted from violations of the False Claims Act resulting from the kickbacks, it was stated.
Mr. Killian further noted that this settlement resulted from a comprehensive investigation
which began as a result of a qui tam or whistleblower complaint filed in 2010. The
investigative team whose efforts resulted in this settlement was comprised of
representatives from the U.S. Department of Health and Human Services - Office of
Inspector General (HHS-OIG), the U.S. Attorney’s Office for the Eastern District of
Tennessee, the U.S. Department of Justice Civil Division Fraud Section, and the U.S.
Attorney’s Office for the Northern District of California.
U.S. Attorney Killian commended the cooperative efforts of the agencies that participated
in this complex investigation, and, in particular, lead HHS-OIG Special Agent Tony Maffei,
DOJ Trial Counsel Adam Schwartz, Assistant U.S. Attorney Betsy Tonkin, Assistant U.S.
Attorney Tom Green, and Special Assistant U.S. Attorney Ben Cunningham.
He said, "This resolution is part of the government’s emphasis on combating health care
fraud and another step for the Health Care Fraud Prevention and Enforcement Action Team
(HEAT) initiative, which was announced by Attorney General Eric Holder and Kathleen
Sebelius, Secretary of the Department of Health and Human Services in May 2009. The
partnership between the two departments has focused efforts to reduce and prevent
Medicare and Medicaid financial fraud through enhanced cooperation. One of the most
powerful tools in that effort is the False Claims Act, which the Justice Department has used
to recover more than $12.1 billion since January 2009 in cases involving fraud against
federal health care programs."
The Justice Department’s total recoveries in False Claims Act cases in 2013 alone
exceeded $3.8 billion. False Claims Act recoveries by the United States Attorney’s Office
for the Eastern District of Tennessee alone during the period since January 2009 exceed
$100 million.
http://www.sequenceinc.com/fraudfiles/2006/05/justice-department-joins-
whistleblower-lawsuit-against-abbott-laboratories/
Justice Department Joins Whistleblower Lawsuit

Against Abbott Laboratories
19 May 2006
The Justice Department has joined a whistleblower lawsuit against Abbott
Laboratories and its spinoff, Hospira. The companies allegedly conspired to
inflate Medicare and Medicaid reimbursements on some drugs.
It is alleged that Abbott Labs reported its drug prices to price publishers (like
Drug Topics Red Book) at levels up to 1,000 percent higher than the prices the
company charged doctors and hospitals. Inflated list prices allowed doctors and
hospitals to request reimbursements from Medicare and Medicaid that were
much higher than the prices actually paid. This profit for the doctors and
hospitals, in turn, induced them to use more Abbott Labs drugs, so the company
increased its own sales and profits.
The conspiracy allegedly went on from 1991 to 2001, and the Justice
Department says that Medicare and Medicaid reimbursed doctors and hospitals
over $175 million for the Abbott drugs at issue in this case. Under the False
Claims Act, the government may recover treble damages and $5,500 to $11,000
for each fraudulent reimbursement claim.
The whistleblower lawsuit was originally filed against Abbott Labs by Ven-A-
Care of the Florida Keys Inc., a home infusion company.
http://www.justice.gov/opa/pr/2013/December/13-civ-1367.html
Friday, December 27, 2013
Abbott Laboratories Pays U.S. $5.475 Million to Settle Claims That Company
Paid Kickbacks to Physicians
Abbott Laboratories
has agreed to pay the United States $5.475 million to resolve allegationsthat it violated the Fal
se Claims Act by paying kickbacks to induce doctors to implant thecompany’s carotid, biliary
and peripheral vascular products, the Justice Department announcedtoday. Abbott is a global
pharmaceuticals and health care products company based in Abbott Park, Ill.
“Patients have a right to treatment decisions that are based on their own medical needs, not
the personal financial interests of their health care providers,” said Assistant Attorney General
Stuart F. Delery of the Civil Division of the Department of Justice. “Kickbacks undermine the
ability of health care providers to objectively evaluate and treat their patients, and will
continue to be a primary focus of the Department’s health care enforcement efforts.”
The settlement resolves allegations that Abbott knowingly paid prominent physicians for
teaching assignments, speaking engagements and conferences with the expectation that these
physicians would arrange for the hospitals with which they were affiliated to purchase
Abbott’s carotid, biliary and peripheral vascular products. As a result,
the United States alleged Abbott violated the Anti-Kickback Act and caused the submission of false
claims to Medicare for the procedures in which these Abbott products were used.
“Physicians should make decisions regarding medical devices based on what is in the best
interest of patients without being induced by payments from manufacturers competing for
their business,” said U.S. Attorney Bill Killian of the Eastern District of Tennessee.
“Offering financial inducements can distort health care decision-making,” said Special Agent
in Charge Derrick L. Jackson of the U.S. Department of Health and Human Services, Office of
Inspector General in Atlanta. “OIG and our law enforcement partners vigilantly protect
government health programs from such alleged abuses.”
Carotid and peripheral vascular products are used to treat circulatory disorders by increasing
blood flow to the head and various parts of the body, respectively. Biliary products are used to
treat obstructions that occur in the bile ducts.
The settlement resolves allegations originally brought in a lawsuit filed by Steven Peters and
Douglas Gray, former Abbott employees, under the qui tam provision of the False Claims Act ,
which allows whistleblowers to file suit on behalf of the United States for false claims and share in
any recovery As part of today’s resolution, Peters and Gray will receive a total payment
of morethan $1 million.
This settlement illustrates the government’s emphasis on combating health care fraud and
marks another achievement for the Health Care Fraud Prevention and Enforcement Action
Team (HEAT) initiative, which was announced in May 2009 by Attorney General Eric Holder
and Health and Human Services Secretary Kathleen Sebelius. The partnership between the
two departments has focused efforts to reduce and prevent Medicare and Medicaid financial
fraud through enhanced cooperation. One of the most powerful tools in this effort is the False
Claims Act. Since January 2009, the Justice Department has recovered a total of more than
$17 billion through False Claims Act cases, with more than $12.2 billion of that amount
recovered in cases involving fraud against federal health care programs.
This settlement was the result of an investigation by the Justice Department’s Civil Division, th
eU.S. Attorney’s Offices for the Eastern District of Tennessee
and the Northern District of Californiaand the Office of Inspector General at the U.S. Departm
ent of Health and Human Services.
The lawsuit is captioned United States ex rel. Peters et al. v. Abbott Laboratories, Inc., Civil
Action No. 3:09-CV-430 (E.D. Tenn.). The claims settled by this agreement are allegations
only, and there has been no determination of liability.
http://bergermontague.com/blog/index.php/abbott-laboratories-settles-yet-
another-set-of-false-claims-act-allegations/
Abbott Laboratories Settles Yet Another Set of False Claims

Act Allegations
Posted by Stephanie R. on Monday, January 13th, 2014
Abbott Laboratories recently settled an off-label marketing case for $1.6 billion following similar violations of
FCA regulations.
Abbott Laboratories is a well-known, repeat offender of rules and regulations enforced by the
federal False Claims Act. The FCA prohibits those in the medical industry from submitting
claims to any government healthcare agency if those claims were derived improperly.
Improper claims could include those from patients retained through a kickback scheme or for
the prescription of certain drugs for uses not intended or approved by the FDA. Under
applicable anti-kickback provisions, claims for reimbursement are considered ineligible if the
medical service was performed on a patient referral derived as part of a kickback scheme with
a medical services or pharmaceutical corporation. If this sort of fraud is uncovered, all parties
involved could face up to triple damages for each unlawful submission of an ineligible invoice.
Details of FCA Case Against Abbott

Abbott Laboratories has agreed to pay $5.475 million in order to avoid prosecution for
violations of the FCA. The facts of the case involve an unlawful kickback scheme involving
several physicians who were offered lucrative incentives in exchange for purchasing and
ordering Abbott’s carotid, biliary and peripheral vascular products. More specifically, doctors
were promised paid positions in teaching and training programs, consulting arrangements and
the opportunity to offer speaking engagements. Under the FCA, any invoice for services
involving these vascular products procured pursuant to this illegal scheme should have been
denied by Medicare or Medicaid for being in violation of the FCA and several anti-kickback
statutes.
Policy Behind Anti-Kickback Laws

At first blush, these punishments may seem to be an unlawful intrusion into the parties’
freedom of contract – a right guaranteed under the Constitution allowing Americans to form
business agreements without unnecessary government intrusion. However, this freedom
is not without exception, and Congress has consistently maintained a policy against any
corporate contracts circumventing public policies or relying on the vulnerability of others to
succeed. Here, as reiterated by the Department of Justice, the FCA seeks to eliminate the
unlawful intrusion on the right of a patient to unilaterally choose his own doctor, hospital and
treatment plan without unwarranted influence by an undisclosed, backroom agreement
between the doctor and a medical device company. As stated by Derrick L. Jackson, Special
Agent in Charge at the U.S. Department of Health and Human Services, Office of Inspector
General in Atlanta, “[o]ffering financial inducements can distort health care decision-
making….OIG and our law enforcement partners vigilantly protect government health
programs from such alleged abuses.”
Help Protect Others From Similar Schemes
When doctors refer patients to certain hospitals or specialists, based not on their
recommendation and experience, but pursuant to a background kickback scheme, those
patients lose their right to individualized, independent care. If you are aware of a similar
scheme at your place of employment, we encourage you to meet with an experienced
whistleblower attorney right away.
If you have discovered evidence of government fraud, contact an experienced False
Claims Act attorney before blowing the whistle. You may be entitled to a substantial
reward and the legal protections afforded to whistleblowers under state and federal
laws. The attorneys of Berger & Montague are nationally recognized experts in
Whistleblower/Qui Tam actions with over a decade of experience pursuing these
complex fraud cases. For more information or to schedule your confidential
consultation,contact us online or call us at (215) 875-5712.
http://www.thedailytimes.com/news/abbott-laboratories-to-pay-million-in-
fraud-settlement/article_39be801e-3a0b-5d53-9cbf-5c24128fc276.html
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Posted: Friday, December 27, 2013 12:00 am
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KNOXVILLE — Abbott Laboratories, a global health care company, has agreed to pay $5.475 million to
settle alleged violations of federal laws in connection with the operation of its medical device business,
according to the U.S. Attorney’s Office for East Tennessee.
As alleged in the settlement agreement, between 2005 and 2010, Abbott agents offered physicians paid
teaching and training assignments, consulting arrangements, speaking engagements and other
inducements for them to influence their hospitals to purchase Abbott’s carotid, biliary and peripheral
vascular products, U.S. Attorney Bill Killian said in a news release.
These financial arrangements were improper and did not meet the requirements of the Anti-Kickback
Statute, a law designed to protect patients as well as the integrity of government-funded health care
benefit programs such as Medicare.
Where the choice of devices used in medical procedures is affected by such improper arrangements,
suppliers that cause claims for such devices and procedures to be submitted to Medicare and other
federal health care programs violate the False Claims Act. “Physicians should make decisions regarding
medical devices based on what is in the best interest of patients without being induced by payments
from manufacturers competing for their business,” Killian said.
Federal law prohibits medical providers from submitting claims to government-funded health care
benefit programs for services and devices referred, ordered or arranged for by physicians who received
such prohibited financial inducements.
During the period between 2005 and 2010, hospitals affiliated with the physicians who received such
inducements submitted to the Medicare program claims which included the cost of the medical devices
referred, ordered or arranged for by such physicians. Medicare paid the claims that included the cost of
the medical devices.
Killian said the settlement resulted from a comprehensive investigation which began as a result of a
whistleblower complaint filed in 2010.
http://standuptofraud.com/site/2014/01/02/whistleblower-suit-settles-abbott-
laboratories/
Whistleblower Suit
Settles Against Abbott
Laboratories
January 2, 2014 4:52 pm
Medical technology and pharmaceutical company Abbott Laboratories agreed to

pay the federal government $5.475 million in connection to allegations of
a kickback scheme. The case was brought under the False Claims Act.
According to a U.S. Department of Justice press release, Abbott Labs

allegedly paid kickbacks to doctors, incentivizing them to push the company’s
carotid, biliary, and peripheral vascular products.
The alleged kickback scheme involved Abbott paying doctors for teaching
assignments, speaking engagements, and conferences where in return the
doctors would have their affiliated hospitals purchase Abbott’s products.
The federal government also alleged that this process violated the Anti-
Kickback Act and that Abbott filedfalse Medicare claims for their products’ use
procedures.
“Physicians should make decisions regarding medical devices based on what

is in the best interest of patients without being induced by payments from
manufacturers competing for their business,” said U.S. Attorney Bill Killian.
The allegations were originally brought forth under the qui tam provision of the
False Claims Act by two former Abbott employees, Steven Peters and Douglas
Gray. This provision allows whistleblowers to file suit on the federal
government’s behalf, and they will receive a portion of any recovery made. In
this instance, each will receive over $1 million.
Although the company was “pleased” to settle to avoid costly litigation,

Abbott spokesperson Angela Duff defended the company saying that “Abbott
believes its action were appropriate at all times.”
“Whistleblowers are important to these cases as they are vital in preventing

companies from committing fraud with near impunity,” said James Kaufman,
a qui tam (or whistleblower) and False Claims Act attorney with Levin,
Papantonio P.A. “They serve greatly in helping the federal government police
these companies.”
Related Article
http://www.modernhealthcare.com/article/20131230/NEWS/312309948
http://www.taf.org/blog/racketeering-allegations-filed-against-abbott-
laboratories
Racketeering Allegations Filed Against

Abbott Laboratories
August 22, 2013
Three health care providers have filed a federal complaint in U.S. District Court, Northern District of
Illinois alleging that the pharmaceutical company engaged in racketeering when it led an off-label marketing
campaign for the epilepsy drug Depakote.
The plaintiffs; Sidney Hillman Health Center of Rochester, New York, the Teamsters Health Services
Insurance Plan Local 404 in Springfield, Massachusetts, and United Food & Commercial Workers Union
and Employers Midwest Health Benefits Fund filed the complaint on August 20. According to the
complaint, Abbott Laboratories' 2012 $1.5 billion False Claims Act settlement was “insufficient to
compensate” for the harm caused to the injured claimants.
In May 2012, the Department of Justice announced a $1.5 billion settlement with the pharmaceutical
company for its alleged off-label marketing of Depakote. That settlement included a $700 million criminal
fine and an $800 million civil settlement with federal ($560,851,357) and state ($239,148,643) governments.
“Abbott probably calculated both its risk of being caught and its potential criminal exposure assuming its
only liability would be to the Medicare, Medicaid, and Tricare systems,” the complaint argues. The plaintiffs
seek unspecified money damages based on claims that each paid for its beneficiaries’ use of the drug.
http://articles.chicagotribune.com/2003-06-27/business/0306270197_1_ross-
products-abbott-laboratories-federal-court
Abbott to settle fraud case

Parent of Ross Products to pay $622 million in federal probe
June 27, 2003|By Bruce Japsen, Tribune staff reporter.

In what would be one of the largest health-care fraud settlements in U.S. history,
Abbott Laboratories will pay more than $600 million to resolve allegations that
the company worked with medical-care providers to bilk government health
insurance programs for the poor and elderly.
The North Chicago-based medical products giant disclosed late Thursday that it
would take a one-time charge in the second quarter of $622 million, or 34 cents a
share, as a result of an anticipated settlement of civil and criminal allegations
against its Ross Products nutrition business.
Disclosure of the settlement, which must still be approved by a federal court,

came after the close of trading on the New York Stock Exchange.
At issue is an industrywide probe into whether Abbott and other medical product
manufacturers encouraged hospitals, nursing homes or home-care providers to
buy pumps and related supplies used to feed seriously ill people--known as
enteral nutrition therapy--by giving products away or selling them at a discount,
sources said.
Some providers then allegedly billed the products at a higher price to either
Medicare, the federal health insurance program for the elderly, or Medicaid, the
federal/state program for the poor, these sources said. For Abbott, the practice
helped it build market share, sources said.
The investigation was reported by the Tribune in 2001.
Abbott wouldn't disclose specifics of the settlement, saying the "matter still has to
be addressed by federal court," spokeswoman Melissa Brotz said. The U.S.
attorney's office for the Southern District of Illinois, which is handling the
nationwide probe, would not comment.
Sources, however, say Abbott has negotiated a plea agreement that would allow
the company to continue to do business with federal and state health insurance
programs.
Abbott wouldn't comment on whether there would be a guilty plea but said Ross'
ongoing business would not be affected. "The anticipated settlement resolves all
matters related to the investigation against the company, including all federal and
state government issues," Brotz said.
Abbott said patient safety is not an issue in the matter. The government
investigation of the industry, which has focused on sales and marketing practices,
dates to the mid-1990s, it added.
Abbott was among at least four nutritional product-makers under investigation:
Novartis AG, Tyco International's Kendall Co. health-care unit and Zevex
International Inc. previously disclosed that they, too, were under investigation.
But Abbott is the first company to announce a potential settlement and is the
biggest player in the business.
Abbott's Columbus, Ohio-based Ross Products division dominates the enteral
nutrition therapy business, serving some 50 percent of the market, according to
industry analysts.
While most consumers pay out-of-pocket for nutritional supplements, federal and
state governments are big purchasers of such supplies for the elderly and disabled
who are unable to feed themselves.
The equipment, which involves pumps and sets of tubes, provides nourishment
directly to the digestive tracts of patients who can't feed themselves or ingest
enough nutrients. Abbott's Ross division, which makes the popular Similac baby
formula, also sells the widely used nutritional supplement Ensure as well as
pumps and related equipment.
Medicare alone spends more than $600 million on enteral pumps and related
supplies, according to statistics from the Centers for Medicare and Medicaid
Services in Washington.
The marketing of products covered under Medicare and other government
insurance programs has increasingly been a focus of federal and state
prosecutors.
In Abbott's case, it is the second major penalty the company will have paid in the
last two years.
Abbott joint venture TAP Pharmaceutical Products Inc. of Lake Forest two years
ago paid a settlement of $875 million and pleaded guilty to conspiring with
doctors to bill insurers for free samples of the prostate cancer drug Lupron. While
Abbott and TAP's other owner, Takeda Chemical Industries of Japan, had to split
the costs of TAP's fine, neither partner was accused of wrongdoing.
As is common in almost all health-care fraud investigations, companies often
settle to avoid having their products excluded from government reimbursement,
analysts say.
"The amount of the settlement is large and there will be some bad publicity when
they settle this, but there is no ongoing issue. ... It is done with," said Glenn
Reicin, analyst with Morgan Stanley in New York.
http://blogs.rollcall.com/moneyline/abbott-laboratories-employee-pac-hit-by-
fraud/
Abbott Laboratories Employee PAC Hit by Fraud

By Kent CooperPosted at 10:06 a.m. on April 29, 2013
0
The Abbott Laboratories Employee PAC reported it has been hit with a series of
instances of fraud during the first quarter amounting to $16,102. The PAC stated (see
page six) an unknown individual had created and cashed fictitious and forged checks.
The PAC discovered the fraud after the close of books for its last report. The PAC listed
four March disbursements, ranging from $3,891 to $4,124, as “unauthorized.” The Bank
of America has returned the funds to the PAC’s account.
See a listing of other cases of embezzlement and missing funds in Political
MoneyLine’s database.
http://www.nytimes.com/2001/10/04/business/2-drug-makers-to-pay-875-
million-to-settle-fraud-case.html
2 Drug Makers to Pay $875

Million to Settle Fraud Case
By MELODY PETERSEN
Published: October 4, 2001
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A joint venture of Abbott Laboratories and Takeda Chemical Industries agreed

yesterday to pay $875 million to settle criminal and civil charges that it had
illegally manipulated the Medicare and Medicaid programs.
The settlement against the joint venture, TAP Pharmaceutical Products, is the
largest for health care fraud.
Prosecutors contended that sales representatives for TAP gave doctors free
samples of Lupron, a drug used to treat prostate cancer and infertility, and then
helped them get government reimbursements at hundreds of dollars for each
dose.
Prosecutors also indicted six current and former employees of TAP -- including
Alan MacKenzie, now the president of Takeda Pharmaceuticals North America --
charging them with conspiracy to pay kickbacks to doctors if they prescribed
Lupron. The kickbacks included trips to resorts, medical equipment and money
offered to the doctors as ''educational grants,'' prosecutors said.
Takeda Pharmaceuticals is the American subsidiary of Takeda Chemical

Industries of Japan. Abbott Laboratories is based in Abbott Park, Ill.
The investigation began more than four years ago after Douglas Durand, a former
vice president for sales at TAP, and Dr. Joseph Gerstein, a urologist employed by
the Tufts Associated Health Maintenance Organization in Waltham, Mass.,
separately told federal officials about what they believed were illegal sales
practices on the part of TAP.
After starting to work with federal investigators, Dr. Gerstein met with TAP sales
representatives who offered him $65,000 in grants that they said he could use for
any purpose if he would reverse his decision to have his health maintenance
organization use only Zoladex, a less expensive drug that competes with Lupron.
Dr. Gerstein, Mr. Durand and Tufts are to share roughly $95 million of the
settlement for serving as whistleblowers under federal law.
The settlement agreement, which had been expected for months, comes as other
drug companies are under scrutiny for similar practices.
Bristol-Myers Squibb and Schering-Plough have said they are being investigated
by the same prosecutors in Boston who announced the settlement with TAP
yesterday. Those investigations also involve questions about how the companies
marketed and priced drugs covered by Medicare. Both companies said yesterday
that they had done nothing wrong.
Michael J. Sullivan, the United States attorney for Massachusetts, said at a news
conference in Boston yesterday that the settlement and indictments sent ''a very
strong signal to the pharmaceutical industry.''
''These types of behavior are not tolerated,'' Mr. Sullivan said, ''and are going to
be investigated, even if it takes four and a half years to bring to conclusion.''
The $875 million settlement is more than the $840 million paid last year by
HCA-the Healthcare Company, the large hospital chain, to settle health care fraud
charges. It is also more than TAP's sales of Lupron last year, which were about
$800 million.
Thomas Watkins, the president of TAP, which is based in Lake Forest, Ill., said
yesterday that the joint venture ''fundamentally disagreed'' with most of the
prosecution allegations, but had decided to settle the case because the
government had threatened to stop all federal reimbursements for Lupron. Those
reimbursements accounted for about $450 million of the drug's sales last year, he
said.
''We could not afford to have this drug denied to our patients,'' he said.
Mr. Watkins added that the availability, safety and effectiveness of Lupron was
never a question in the case.
He said that TAP admitted it provided free samples of Lupron to a number of

physicians, primarily in the early to mid-1990's, knowing that the doctors would
seek reimbursement from the federal government.
''The billing for free samples is wrong, and it should never have happened,'' Mr.
Watkins said. ''We have taken strong action so that this inappropriate marketing
practice will never happen again.''
Takeda Pharmaceuticals said that Mr. MacKenzie had decided to take a leave of
absence from the company to focus on his defense against the government's
charges.
''We fully support him in his belief that he will be exonerated,'' said Matt Kuhn, a
Takeda spokesman, ''and we look forward to his return.''
Medicare now covers a very limited number of drugs. Most of them are products
like Lupron, which must be administered by a physician.
Pharmaceutical companies supply doctors with drugs to give Medicare patients,

and Medicare then repays the doctors based on a price provided by the companies
called the ''average wholesale price.''
The government charged TAP with inflating that price so that doctors could be
reimbursed more than TAP actually charged them for the drug. The excessive
government reimbursements were cited by sales representatives, the government
said, as a way to get doctors to prescribe Lupron rather than its lower-priced
competitor.
In addition, since the government pays just 80 percent of the price of the drug,
and patients pay the rest, prosecutors said that TAP had defrauded hundreds of
elderly Medicare patients, mostly men suffering from prostate cancer, by inflating
Lupron's average wholesale price.
At least one lawsuit has been filed against TAP to recover the excessive payments
by patients.
The government has also charged five doctors with health care fraud in the case.
Prosecutors said that those doctors had conspired with the company to receive
excessive Medicare reimbursements. Four of those doctors were charged months
ago and all have pleaded guilty to the charges. The fifth doctor was indicted
yesterday.
As part of yesterday's settlement, TAP also agreed to comply with a 33-page

''corporate integrity agreement.'' The document requires TAP to train its
employees in the proper methods of promoting and marketing drugs covered by
federal health programs. The agreement also requires TAP to accurately report its
true average sales price for Lupron and other drugs to the Medicare and Medicaid
programs.
The company would be forced to pay a fine of $2,500 for each day it fails to
comply with the agreement, which is effective for the next seven years.
Charles S. Prouty, special agent in charge of the F.B.I. in New England, which was
part of the investigation, said that other cases were still going forward and would
result in ''very significant settlements.''
Medicare frauds, he said, ''are an insidious kind of white-collar crime, and we

have made some serious inroads in attacking them.''
http://www.modernhealthcare.com/article/20131230/NEWS/312309948
Abbott agrees to cooperate in kickback investigation
By Joe Carlson
Posted: December 30, 2013 - 3:00 pm ET
Tags: Hospitals, Legal, Medicare, Physicians, Purchasing
Abbott Laboratories has agreed to cooperate in an investigation of alleged kickbacks to doctors in return
for them encouraging hospitals to buy the company's array of vascular products.
Abbott and the U.S. Justice Department announced last week the company would pay $5.5 million to
settle a lawsuit claiming (PDF) it knowingly bribed the doctors to influence purchasing decisions
between 2005 and 2010. The allegations came from two formerly high-ranking Abbott sales personnel,
Steve Peters and Douglas Gray.
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Abbott, based in Abbott Park, Ill., did not admit wrong-doing in the whistleblower lawsuit (PDF), which
alleged the company knowingly made payments to doctors that broke the anti-kickback law, triggering
False Claims Act violations of Medicare payment rules.
“We're pleased to resolve this matter. Abbott entered into the settlement agreement to avoid the
uncertainty and expense of protracted litigation. Abbott believes its actions were appropriate at all
times,” the company said in a statement.
The two whistleblowers said Abbott paid “prominent” doctors to take teaching assignments and
speaking engagements with the expectation that they would then arrange for the hospitals with which
they were affiliated to purchase Abbott's carotid, biliary and peripheral vascular products, according to
the U.S. attorney's office in Knoxville, Tenn., where the case was filed.
“Physicians should make decisions regarding medical devices based on what is in the best interest of
patients without being induced by payments from manufacturers competing for their business,” U.S.
Attorney Bill Killian of the Eastern District of Tennessee said in a news release.
Peters and Gray will receive a total of just over $1 million from the settlement under the False Claims
Act, which allows private parties to collect awards in cases when they bring insider information that
leads to settlements involving allegedly false claims to government programs.
As part of the settlement, the company agreed to cooperate in an investigation of any individuals or
entities allegedly involved in the scheme who have not yet settled. That includes encouraging its current
and former directors, officers and employees to testify for the government and submitting complete
copies of all internal documents relating to the alleged kickbacks.
Follow Joe Carlson on Twitter: @MHJCarlson
http://www.businessweek.com/news/2014-02-05/abbott-labs-sued-for-fraud-
by-men-claiming-androgel-harms-1
Bloomberg News
Abbott Labs Sued for Fraud

by Men Claiming AndroGel
Harms (1)
By Andrew Harris February 05, 2014
Abbott Laboratories (ABT:US) and AbbVie Inc., the company it spun

off last year, hid the dangers of using the testosterone replacement drug
AndroGel, five men claimed in lawsuits.
Their complaints, filed in the federal court in Chicago yesterday, came
four days after the U.S. Food and Drug Administration said it will re-
examine the safety of testosterone replacement drugs after two studies
showed a higher risk of heart attacks and strokes in men who use them.
The men range in age from 50 to 63, according to their complaints.

Three claim they had heart attacks after they started using AndroGel,
and a fourth said he had a stroke. The fifth man said he had a mini-
stroke.
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Abbott and AbbVie “deceived potential AndroGel users by relaying
positive information through the press, including testimonials from
retired professional athletes” and statistics suggesting a widespread
need for the drugs, “while downplaying known adverse and serious
health risks,” according to the complaints.
The men accuse Abbott, which marketed the drug from 2010 through
2012, and prescription drug-maker AbbVie of concealing knowledge
that AndroGel had a “serious propensity” to harm.
The market for testosterone-replacing drugs, which include AndroGel
and Axiron, made by Eli Lilly (LLY:US) & Co., is worth $1.6 billion.
Indianapolis-based Eli Lilly is not named in the lawsuits.
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Crowdsourced Cancer Cure
Raises Risk
Adelle Infante, a spokeswoman for North Chicago-based AbbVie, did

not immediately reply to voice-mail messages for comment on the
filings. Scott Stoffel, a spokesman for Abbott Park, Illinois-based Abbott
Labs, declined to immediately comment.
Each complaint was filed by the same two law firms, Alton, Illinois-
based Simmons Browder Gianaris Angelides & Barnerd LLC and Morelli
Alters Ratner LLP in New York. Their clients are seeking unspecified
damages.
A study released in November of more than 8,000 men treated in the

Veterans Health Administration found testosterone therapy raised the
risk of heart attack, stroke and dying by 29 percent. Testosterone
worsens sleep apnea and is linked to atherosclerosis and coronary
plaque, the study found without identifying reasons why.
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Prescriptions for the supplements rose more than fivefold to 5.3 million
in 2011 from 2000, the authors said. The products are only FDA-
approved for men who lack or have low testosterone levels in
conjunction with a medical condition, the agency said.
The FDA advised patients to talk to their doctors.
The cases are Aurecchia v. AbbVie Inc. (ABBV:US), 14-cv-00772; Benn

v. AbbVie, 14-cv-00774; Gallagher v. AbbVie Inc., 14-cv-00776; Marino
v. AbbVie Inc., 14-cv-00777 and Myers v. AbbVie Inc., 14-cv-00780;
U.S. District Court, Northern District of Illinois (Chicago).
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Starring B-List Heroes
To contact the reporter on this story: Andrew Harris in federal court in
Chicago at aharris16@bloomberg.net
To contact the editor responsible for this story: Michael Hytha at
mhytha@bloomberg.net
http://www.drugs.com/news/house-committee-probes-medicaid-fraud-contacts-26-
companies-3-wholesalers-3332.html
House Committee probes

Medicaid fraud, contacts 26
drug companies, 3
wholesalers
WASHINGTON, D.C., June 26, 2003 -- As part of an expanded
investigation into Medicaid fraud, House Energy and Commerce
Committee Chairman Billy Tauzin (R-LA) and Oversight and
Investigations Subcommittee Chairman James Greenwood (R-PA) have
sent letters to the following 26 drug companies: Abbott Labs, Alpharma,
Apotex, Aventis Pharmaceuticals, Barr Labs, Bristol Myers, Dey, Ethex,
Eli Lilly, Indianapolis, Geneva, GlaxoSmithKline, IVAX, Johnson &
Johnson, Mylan Pharmaceuticals, Par Pharmaceuticals, Pfizer,
Pharmacia, Purdue Pharma, Purepac, Roche, Roxane, Schering-Plough,
TEVA, UD Labs, Warrick Pharmaceuticals, and Watson; and similar
letters to drug wholesalers AmeriSource-Bergen, Cardinal, and
McKesson.
(The following is a copy of the letter sent to Abbott Laboratories

Chairman and CEO Miles White. Identical letters were sent to the other
companies.)
June 26, 2003

Mr. Miles D. White
Chairman and Chief Executive Officer
Abbott Laboratories
100 Abbott Park Road
Abbott Park, IL 60064-3500
Dear Mr. White,
The Committee on Energy and Commerce is conducting an

investigation into pharmaceutical reimbursements and rebates under
Medicaid. This inquiry builds upon the earlier work by this Committee
on the relationship between the drug pricing practices of certain
pharmaceutical companies and reimbursement rates under the
Medicare program. In that investigation, the Committee uncovered
significant discrepancies between what some pharmaceutical
companies charged providers for certain drugs and what Medicare then
reimbursed those providers for dispensing those drugs. This price
difference resulted in profit incentives for providers to use the drugs of
specific companies as well as higher costs to the Medicare system and
the patients it serves. For example, we learned that one manufacturer
sold a chemotherapy drug to a health care provider for $7.50, when the
reported price for Medicare was $740. The taxpayer therefore
reimbursed the doctor almost $600 for dispensing the drug and the
cancer patient had a $148 co-payment. Such practices are
unacceptable in the view of the Committee, which is why we are in the
process of moving legislation to address these abuses.
The Committee has similar concerns regarding drug prices in Medicaid,

which has a substantially larger pharmaceutical benefit than Medicare.
For this Medicaid investigation, we have chosen to review pricing and
other aspects relating to certain drugs produced by your company,
along with a fairly large group of other drugs and manufacturers, based
upon several indicia from a number of sources, including utilization
data, drug price/reimbursement spreads, and other relevant
information.
In order for this Committee to effectively and efficiently conduct this

review, we are requesting that, pursuant to Rules X and XI of the U.S.
House of Representatives, you provide the Committee with the
following records and information by July 11, 2003. For the purposes of
these requests, please observe the following definitions: "subject
drugs" means: acyclovir, amikacin sulfate, furosemide, gentamicin
sulfate, paclitaxel, tobramycin sulfate, and vancomycin, in all dosages,
strengths or volumes, and regardless of any packaging, labeling or
identifiers; "purchaser" means any wholesaler, distributor, retailer,
provider, doctor, hospital, pharmacy, health maintenance organization,
or any other such entity that obtains the subject drugs at any cost,
including free of charge; "spread" means the difference between the
cost of the drug to the purchaser and the reimbursement amount the
purchaser may receive from any State's Medicaid program, including,
but not limited to, (1) the difference between the cost or price to the
purchaser and the actual or anticipated Medicaid reimbursement or, (2)
the difference between the cost or price to the purchaser and any price
or cost submitted, or caused to be submitted by the drug's
manufacturer, to any State, Federal agency or Medical Economics Red
Book, First Data Bank or Medi-Span or any other such entity that
gathers and publishes drug cost or pricing data, such as "average
wholesale price," or "wholesale acquisition cost"; and "net revenue"
means revenue received from the sale of subject drugs after
subtracting any discounts, rebates, charge-backs or any other such
price concession, paid by you to any purchaser.
Further, for the purposes of responding to these requests, where
providing records or information, please separate and distinguish such
records or information, to the extent possible, by each applicable
National Drug Code ("NDC") and Healthcare Common Procedural Coding
System code. Also, for the purposes of responding to these requests,
please do not produce any specific patient medical information. Finally,
please note that these requests are directed to your company and any
and all related corporate entities that may have responsive documents
or information, including, but not limited to, any parents, subsidiaries,
partnerships, or joint ventures.
1. For the period beginning January 1, 1998, and for each subsequent
calendar quarter, and with respect to each of the subject drugs, please
provide the following information using the format of the chart below:
a. the total volume of sales, indicating both the number of units and net
revenue;
b. the "average wholesale price" (AWP), as reported in Medical
Economics Red Book, First Data Bank and/or Medi-Span, and the volume
of sales (in both units and net revenue) occurring (i) at or within five
percent of AWP, whether higher or lower, (ii) at more than five percent
above AWP, and (iii) at more than five percent below AWP;
c. the "average manufacturer price" (AMP), as reported to the Secretary
of Health and Human Services, pursuant to the requirements of Social
Security Act ("SSA") §1927(b)(3), and the volume of sales (in both units
and net revenue) occurring (i) at AMP and up to and including 10
percent above AMP, and at below AMP but less than or equal to 10
percent below AMP (broken out separately), (ii) at greater than 10
percent above AMP but less than or equal to 20 percent above AMP,
and at greater than 10 percent below AMP but less than or equal to 20
percent below AMP (broken out separately), (iii) at greater than 20
percent below AMP (broken out separately), (iv) at greater than 30
percent below AMP (broken out separately), and (v) at greater than 40
percent below AMP (broken out separately);
d. the "wholesale acquisition cost" (WAC), as reported by Medical
Economics Red Book, First Data Bank and/or Medi-Span or any other
such entity that gathers and publishes "wholesale acquisition costs,"
and the volume of sales (in both units and net revenue) occurring (i) at
or within five percent of WAC, whether higher or lower, (ii) at more than
five percent above WAC, and (iii) at more than five percent below WAC;
e. the "best price," as reported to the Secretary of Health and Human
Services, pursuant to the requirements of SSA §1927(b)(3), and the
volume of sales (in both units and net revenue) occurring (i) at or within
five percent of the best price, whether higher or lower, (ii) at more than
five percent above best price, and (iii) at more than five percent below
best price (if applicable);
f. the total volume of sales, in both the number of units and net
revenue, exempted from the calculation of the Medicaid best price as
"merely nominal in amount," pursuant to the requirements of SSA
§1927(c)(1)(C)(ii)(III);
g. the average price of the "nominal" sales, referenced in subsection (f),
above; and
h. the total volume of the subject drug, in units, distributed as free
goods.
2. For the period beginning January 1, 1998, and for each subsequent
calendar quarter, and with respect to each of the subject drugs, please
provide the
following information:
a. the total volume of the subject drug, in units and net revenue,
distributed under state Medicaid programs;
b. the average per unit rebate issued for the subject drug; and c. the
total amount of rebates, in dollars, issued to state Medicaid programs
with respect to the subject drug.
3. For the period of January 1, 1998, to the present, please provide all
records relating to any perceived or actual failure of any State to seek
or achieve full rebates for the subject drugs dispensed under its state
Medicaid system.
4. For the period beginning January 1, 1998, to the present, has the
distribution, marketing, sales or promotion of any subject drug
considered, incorporated, or been based upon, in any way, the spread?
If so, please describe the circumstances of such distribution,
marketing, sales or promotion, and provide all records relating thereto.
5. For the period beginning January 1, 1998, to the present, please

provide all records relating to the spread on the subject drugs.
records relating to comparisons between the spread of any subject
drug and the spread of any generic or therapeutically equivalent
product.
records relating to the distribution, marketing, sales or promotion of
any subject drug at prices exempted from the calculation of the
Medicaid "best price," pursuant to the requirements of SSA §1927(c)(1)
(C)(ii)(III), including, but not limited to, distribution, marketing, sales or
promotion of the subject drug at "nominal price" or otherwise as free
product, free goods, or at no cost.
8. For the period of January 1, 1998, to the present, please state for
each calendar quarter the largest single purchaser, in terms of units, of
each of the subject drugs and the following:
a. the total number of units of the subject drug received by that

purchaser; and
b. the total net revenue received for the subject drug by your company
from that purchaser.
Please also provide the contract or agreement governing your

relationship with that purchaser for each relevant quarter.
9. For the period of January 1, 1998, to the present, and for each
subject drug, please provide a list of all purchasers who received the
subject drug at a price exempted from the calculation of the Medicaid
"best price," pursuant to the requirements of SSA §1927(c)(1)(C)(ii)(III),
and, for each such purchaser, indicate the volume of the subject drugs
received by calendar quarter, in units, and the range of prices at which
such purchaser received the subject drug for that quarter.
10. Please state the date of expiration for any patents on the subject
drugs.
11. Please describe how you define, interpret and/or calculate "prices
that are merely nominal in amount," as set forth in SSA §1927(c)(1)(C)
(ii)(III).
12. With respect to each subject drug, please describe how you
calculate the prices and/or data reported to Medical Economics Red
Book, First Data Bank or Medi-Span or any other such entity that
gathers and publishes either "average wholesale prices" or "wholesale
acquisition costs."
records relating to the "average wholesale price" or "wholesale
acquisition cost" of any subject drug that was submitted to Medical
Economics Red Book, First Data Bank or Medi-Span or any other such
entity that gathers and publishes "average wholesale prices" and/or
"wholesale acquisition costs."
records relating to any proposed, considered or implemented change in
the "average wholesale price" or "wholesale acquisition cost" of any
subject drug.
Please note that, for the purpose of responding to the above requests,
the terms "records" and "relating" should be interpreted in accordance
with the attachment to this letter. If you have any questions, please
contact Mr. Mark Paoletta, Chief Counsel for Oversight and
Investigations, at (202) 225-2927.
Sincerely,
W.J. "Billy" Tauzin Chairman
James C. Greenwood Chairman Subcommittee on Oversight and
Investigations
cc: The Honorable John D. Dingell, Ranking Member The Honorable
Peter Deutsch, Ranking Member Subcommittee on Oversight and
Investigations
Posted: June 2003

http://www.beasleyallen.com/news/louisiana-settles-medicaid-fraud-litigation-for-88-4-
million/
Louisiana settles Medicaid Fraud

litigation for $88.4 million
posted on:
November 25, 2013
author:
Staff
category:
Fraud
Louisiana Attorney General Buddy Caldwell has reached an $88.4 million

settlement with 25 pharmaceutical companies in the state’s ongoing Medicaid
Fraud litigation. Beasley Allen attorneys W. Daniel “Dee” Miles, III, Clay
Barnett, Roman Shaul, Chad Stewart, and Alison Hawthorne, along with in-
house counsel, represented Louisiana in the litigation, which began three years
ago over Average Wholesale Pricing (AWP). The lawsuit accused 100 drug
makers and their subsidiaries of fraudulently inflating the price of drugs sold to
states and reimbursed by Medicaid, overcharging the state.
Included in the recent settlement are Abbott Laboratories, which will pay $6.2
million; Sanofi, $7 million; Novartis and its Sandoz unit, which will pay a
combined $20 million; Johnson & Johnson, $10 million; Par Pharmaceutical, $6
million; and Ranbaxy Laboratories, which will pay $5 million. Including the
latest settlement, since beginning the litigation Louisiana has reached
settlements totaling $238.1 million. Louisiana has recovered nearly $300 million
when cost and attorney fees are included.
In a statement, Attorney Gen. Caldwell said, “These companies took advantage

of the state and its taxpayers by fraudulently over-pricing and marketing
prescription drugs, thereby forcing the state’s Medicaid program to grossly
over-pay for those prescriptions. This kind of success sends a clear message to
companies who don’t do business honestly.”
“This is another huge victory for the State of Louisiana,” Miles said.
“Pharmaceutical companies overcharging for drugs to the state’s Medicaid
program – a program designed to assist the state’s neediest citizens – is
egregious conduct.”
The complaints were brought under the Louisiana Unfair Trade Practices and
Consumer Protection Act and Louisiana’s Medical Assistance Programs Integrity
Law. The cases are Louisiana v. Abbott Laboratories Inc. et al., case number
596, 164, and Louisiana v. McKesson Corp. et al., case number 567, 634, both in
the 19th Judicial District Court for the State of Louisiana, Parish of East Baton
Rouge.
Beasley Allen has represented other states, including Alabama, in this ongoing
litigation, and continues to fight for states whose Medicaid programs were
defrauded by inflated drug prices. The firm has already settled nearly $1 billion
in identical claims in eight states, and expects to top that figure with more
than 30 cases still pending. States the firm has represented or is currently
representing include Alabama, Alaska, Mississippi, South Carolina, Utah,
Kansas, Hawaii and Louisiana.
These average wholesale price cases have made a tremendous positive impact
on Medicaid Agencies throughout the country. As a result of this AWP litigation,
the federal government and the State Medicaid programs have recognized the
gross abuse of price reporting by the pharmaceutical manufacturers in the
marketplace. This fraudulent price reporting resulted in huge government
waste that has now hopefully been rectified by this litigation.
http://augustafreepress.com/feds-agree-to-release-115m-due-va-from-
medicaid-fraud-settlement/
Feds agree to release $115M due Va. from

Medicaid fraud settlement
Published Wednesday, Jun. 5, 11:16 pm
Get real-time news updates from AFP on Facebook and Twitter

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services:AFPBusiness.com
This afternoon, the U.S. Treasury Department alerted

Attorney General Ken Cuccinelli that it would release $115 million due to Virginia for his
office’s role as the lead investigator in a 2012 Abbott Laboratories Medicaid fraud
settlement.
The attorney general’s office received a letter from Treasury’s Executive Office for Asset
Forfeiture (TEOAF) that a decision had been made on the disbursement. Subsequent
phone calls with TEOAF confirmed the $115 million figure.
“I am grateful to Treasury’s Executive Office for Asset Forfeiture for agreeing to work with
us to get this money to Virginia law enforcement,” said Cuccinelli. “We have been
planning for more than a year to use this money for equipment and training to benefit law
enforcement and communities throughout Virginia.
“This money is coming to Virginia because of the hard work and dedicated service of the
staff of the Virginia Medicaid Fraud Control Unit. I want to thank them for their
distinguished service to the people of the commonwealth,” he said.
In a news conference earlier today, Cuccinelli detailed how he wanted the money to be
spent on law enforcement. He also gave an accounting of the struggle to get the money
to Virginia.
The Office of the Attorney General has no indication of when the money will be
disbursed.
Additionally, some reporters have asked for clarification about what part of the Abbott
settlement went to help Medicaid recipients. That money has already been disbursed.
The May 2012 $1.5 billion Abbott settlement was divided into (1) $800 million in civil
settlements with the federal government and the states and (2) $700 million in criminal
fines and forfeitures.
Under the civil settlement, Abbott paid $800 million to the federal government and the
states to settle claims for defrauding Medicaid and other government health care
programs. That part of the settlement has already happened and the money went to
reimburse Medicaid and other programs to help beneficiaries.
Under the criminal portion, Abbott paid the federal government a criminal fine of $500
million, it paid $1.5 million to the Virginia Medicaid Fraud Control Unit for investigative
costs, and it forfeited assets of $198.5 million to go to the investigative agencies for law
enforcement purposes. Virginia’s $115 million today comes from that asset forfeiture
money, which is required by federal regulations to be used for law enforcement
purposes.
http://www.topclassactions.com/lawsuit-settlements/lawsuit-news/5213-
abbott-laboratories-class-action-lawsuit-filed-over-secret-phone-call-recording/
Abbott Laboratories Class Action Lawsuit

Filed Over Secret Phone Call Recording
By John Curran
A California woman has filed a class action lawsuit against pharmaceutical

company Abbott Laboratories after finding out the company secretly recorded
a phone conversation she had with a representative regarding Similac infant
formula.
Plaintiff Maggie Franco says that a representative who answered
her call to a toll-free number did not tell her that the call was
being recorded and in no part of the conversation did she provide
“express or implied consent to the recording.” Franco alleges in
the invasion of privacy lawsuit that Abbott “records all incoming
telephone calls” without disclosure. Recording phone calls
without informing customers is a violation of California’s Invasion
of Privacy Act.
Her invasion of privacy lawsuit cites evidence that consumers who make
phone calls regarding products for children and healthcare concerns, like
Franco did, have a reasonable expectation that these conversations are
confidential. In addition, a poll from research firm Harris included in the
potential class action lawsuit indicates that 73 percent of Americans “believe
that it is ‘extremely important’ that conversations never be recorded or
monitored without the consent of all parties.” However, the expectation of
privacy is not required for the class of citizens to seek damages in California
via state statute violations.
The relevant sections of the California Penal code are 632.5-
632.7, which define contact between landlines, cordless phone,
and cell phones in each of the various permutations and deems a
violation has occurred when someone “intercepts or receives and
intentionally records” or assists in that effort “without the
consent of all parties.” California is just one of dozens of states
that requires all parties to agree for a phone call to be recorded.
In addition, a California state appeals court has written that the

goal of the statute is wide-ranging “but at a bare minimum must
ensure an individual’s right to control the firsthand dissemination
of a confidential communication, and …to strongly protect an
individual’s privacy rights in electronic communications.”
Franco is seeking statutory damages of up to $5,000 per violation

or treble damages if Abbott Laboratories is found to have
engaged in illicit wiretapping in a wanton matter. The putative
class is only seeking damages for that section of the penal code,
rather than common law privacy damages.
Franco and the rest of the class are represented by Thomas D.

Mauriello of Mauriello Law Firm APC and James C. Shah and Rose
F. Luzon of Shepherd Finkelman Miller & Shah, LLP.
The Abbott Laboratories Phone Call Recording Class Action Lawsuit is Maggie
Franco et al. v. Abbott Laboratories Inc., Case No. 13-cv-01906, in the
United States District Court, Central District of California.
http://www.schiffhardin.com/File%20Library/Publications%20(File%20Based)/PDF/2012-
02-10-No-ERISA-510-Violation.PDF
No ERISA §510 Violation or Fiduciary Breach
from Spin-Off Design
By Diane Soubly
Schiff Hardin ERISA Litigation & Benefits Blog
February 10th, 2012
In a certified class action, the Seventh Circuit affirmed findings made in a 9-day bench trial
that
Abbott Laboratories (Abbott) did not specifically intend to interfere with plaintiffs’
employee benefits
rights in violation of ERISA §510 or breach ERISA fiduciary duties when it spun off its
Hospital
Products Division (HPD) into a separate company called Hospira, Inc. (Hospira). Nauman
v. Abbott
Laboratories and Hospira, Inc., No. 10-2272 (7th Cir., Feb. 3, 2012). Plaintiffs claimed that
Abbott
used the spin-off and a no-hire policy to rid itself of unwanted pension liabilities and to
prohibit them
from receiving unvested benefits.
Related Articvle
ERISA Class Action Defense Cases–Nauman v. Abbott

Laboratories: Illinois Federal Court Denies Defense Motion For
Summary Judgment On ERISA Class Action Complaint Holding
Conduct “As A Whole” Warranted Trial
Defense Summary Judgment in ERISA Class Action Complaint Erroneously
Attacked Class Action Claims as Separate and Distinct, but when Defendants’
Conduct was Considered as a Whole, Genuine Issues of Material Fact Existed
Sufficient to Defeat Summary Judgment Illinois Federal Holds
Plaintiffs filed a class action lawsuit against their former employer, Abbott Laboratories,
and their new employer, Hospira, a newly-created corporate entity, after Abbott spun off
its Hospital Products Division (HPD) to Hospira. The class action complaint alleged that the
manner in which defendants spun off HPD violated sections 510 and 404 of
ERISA. Nauman v. Abbott Labs., ___ F.Supp.2d ___ (N.D.Ill. July 10, 2008) [Slip Opn., at
1]. The four-count class action alleged that, in order to save money associated with the
costs of its pension and retiree medical benefits plans for older workers, (1) Abbott
terminated HPD employees with the specific intent of denying them retirement benefits,
(2) as part of that scheme, Abbott refused to rehire employees transferred to Hospira
within two years of the transfer, (3) as part of that scheme, Hospira refused to hire Abbott
employees who retired and collected benefits from Abbott, and (4) Abbott breached
fiduciary duties owed under § 404 “by making deliberate misrepresentations about the
benefits that post-spin-off employees could expect at Hospira.” Id., at 1-2. Defense
attorneys moved for summary judgment on the class action claims on the grounds that
Abbott argued that it had legitimate business reasons for spinning off HPD. Id., at 2, 16.
The district court held that while the claims may be subject to attack if viewed individually,
when the course of conduct are viewed as whole the class action adequately presented
genuine issues of material fact as to whether defendants acted with a specific intent to
deny benefits to retirees in violation of ERISA.
After providing a lengthy discussion of the material facts, see Nauman, at 5-12, and the
legal standard governing § 510 claims under ERISA, see id., at 12-15, and § 404 claims
under ERISA, see id., at 16, the district court turned to the merits of the defense motion.
The federal court admitted that by “dissecting” the claims in the class action and
“examining each in isolation,” the summary judgment motions were “generally persuasive”
and “convincing[],” id., at 16. But the district court explained that the motions were
“premised on the assumption that the several counts of plaintiffs’ complaint arise out of
independent and unrelated events,” id., at 17. The defense motions thus overlook the
thrust of the class action – viz., “that the termination alleged in Count I, coupled with the
policies challenged in Counts II and III, constitute a ‘scheme’ that Abbott conceived, and
that the defendants jointly adopted, with the specific intent of avoiding the payment of
projected benefits.” Id., at 18. The court considered defendants’ conduct “as a whole,” id.,
at 20, and concluded that genuine issues of material fact existed sufficient to warrant a
trial on the § 510 class action claims, id., at 21-22.
With respect to the class action’s § 404 claim, the defense argued that it was under no
obligation to advise employees about the benefits that would be provided by Hospira and
that, in any event, plaintiffs could not demonstrate detrimental reliance. Nauman, at 22.
The district court disagreed. First, genuine issues of material fact exist as to whether
Hospira was truly separate from Abbott, id., at 23-24. And second, the court stated that
the Seventh Circuit has never held detrimental reliance to be an element of an ERISA §
404 claim, id., at 24-25. Accordingly, the court denied the defense motions for summary
judgment. Id., at 25.
http://www.sequenceinc.com/fraudfiles/2006/05/justice-department-joins-
whistleblower-lawsuit-against-abbott-laboratories/
Justice Department Joins Whistleblower Lawsuit

Against Abbott Laboratories
19 May 2006
The Justice Department has joined a whistleblower lawsuit against Abbott
Laboratories and its spinoff, Hospira. The companies allegedly conspired to
inflate Medicare and Medicaid reimbursements on some drugs.
It is alleged that Abbott Labs reported its drug prices to price publishers (like
Drug Topics Red Book) at levels up to 1,000 percent higher than the prices the
company charged doctors and hospitals. Inflated list prices allowed doctors and
hospitals to request reimbursements from Medicare and Medicaid that were
much higher than the prices actually paid. This profit for the doctors and
hospitals, in turn, induced them to use more Abbott Labs drugs, so the company
increased its own sales and profits.
The conspiracy allegedly went on from 1991 to 2001, and the Justice
Department says that Medicare and Medicaid reimbursed doctors and hospitals
over $175 million for the Abbott drugs at issue in this case. Under the False
Claims Act, the government may recover treble damages and $5,500 to $11,000
for each fraudulent reimbursement claim.
The whistleblower lawsuit was originally filed against Abbott Labs by Ven-A-
Care of the Florida Keys Inc., a home infusion company.
Texas receives $14 million
settlement from Abbott
Laboratories' Medicaid fraud
case
Advertisement
Posted: Monday, May 7, 2012 3:21 pm | Updated: 3:34 pm, Mon May 7, 2012.
From the Texas Attorney General's Office
Texas Attorney General Greg Abbott and other state attorneys general today resolved a two-phase
Medicaid fraud and deceptive marketing investigation into Abbott Laboratories. The investigation
centered on the unlawful promotional scheme that Abbott Laboratories launched to increase the sales of
its anti-seizure drug Depakote.
Attorney General Abbott made the following statement about the settlement, which allocates $14 million
to the State of Texas for improper Medicaid overpayments, and an additional $5.8 million for violations
of the Deceptive Trade Practices Act:
“It is against the law for drug manufacturers to promote their drugs for unapproved uses, but Abbott
Labs did just that. In an apparent effort to expand the use of its drug, Abbott Labs overstepped. The
agreement reached last week holds the company accountable for violating the law and defrauding the
taxpayer-funded Medicaid program.”
In an enforcement action filed along with the consumer fraud settlement, the attorneys general assert
that Abbott Laboratories went far beyond urging physicians to prescribe Depakote for seizure disorders
such as epilepsy, which is an approved use. The company promoted the “off-label” use of Depakote in
treating schizophrenia, agitated dementia and autism, uses not approved by the U.S. Food and Drug
Administration. In the separate Medicaid fraud case, the company also unlawfully exploited the state’s
Medicaid program in marketing Depakote from 1998 until 2008.
Under the settlement, Abbott Laboratories must not make false claims about Depakote’s benefits or
promote it for off-label uses. Regarding future sales of the drugs and financial incentives, the company
must ensure that such incentives do not promote off-label uses of the drug.
Under the Texas portion of the civil Medicaid fraud settlement, Texas will receive about $14 million to
include payment to the general revenue, relators’ fees and attorneys’ fees. Under the consumer
protection portion of the award, $3.9 million will be allocated to general revenue and $1.95 million to
State attorneys’ fees.
http://www.wbez.org/blog/city-room-blog/abbott-labs-settles-421-million-fraud-case
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Abbott Labs settles $421 million fraud case
December 7, 2010
By: Scarlett Robertson
North Chicago, IL based Abbott Laboratories Inc, B. Braun Medical Inc. and Roxane
Laboratories Inc., have agreed to pay a combined $421 million to settle a federal civil lawsuit.
The U.S. government alleged the drugmakers were involved in a scam that deliberately inflated
drug prices reported to Medicare and Medicaid programs. The drugs involved in the case include
antibiotics, painkillers, injectible agents and nutritional solutions.
Federal prosectuors claimed the Abbott and the other companies created a kickback scheme that
allowed doctors and pharmacies to profit by buying the product at one price, while being
reimbursed at another. “Not only did this practice cost our public healthcare programs millions of
dollars, it also threatened to undermine the integrity of the choices health care providers made for
their patients,” said Tony West, Assistant Attorney General for the Civil Division of the
Department of Justice during a press conference Tuesday.
Under the terms of the agreement, Roxane will pay $280 million, Abbott will pay $126.5 million
and B. Braun Medical will pay $14.7 million to resolve the lawsuits. The settlement is the latest
in the government's continued efforts to combat fraud against federal health care programs.
Despite today's settlement, Abbott continues to deny any wrongdoing in the case. “We continue to
believe that we have complied with all laws and regulations and have entered into this agreement
to eliminate the uncertainty associated with continued litigation, ” said Adelle Infante,
spokesperson for Abbott Laboratories.
http://cdn.ca9.uscourts.gov/datastore/opinions/2009/01/12/0655687.pdf
http://www.eeoc.gov/eeoc/newsroom/release/9-22-10c.cfm
http://www.jud.state.ct.us/external/supapp/Cases/AROap/AP114/114AP282.pdf
https://www.courtlistener.com/illappct/bADn/vickers-v-abbott-laboratories/
http://securities.stanford.edu/filings-documents/1009/ABT99/19991027_o01c_ISAAC.html
http://www.ecases.us/cafc/2007/10/210289
http://cases.laws.com/ohio/ohio-dautartas-v-abbott-laboratories
http://tobaccodocuments.org/lor/98314407-4409.html
http://healthlawreporter.bbablogs.org/2013/06/28/health-law-case-brief-u-s-ex-rel-conrad-v-
abbott-laboratories-inc/
http://openjurist.org/850/f2d/203/parlato-v-abbott-laboratories
http://openjurist.org/850/f2d/203/parlato-v-abbott-laboratories
http://business.cch.com/plsd/SecNatBankvAbbott.pdf
http://www.sconet.state.oh.us/rod/docs/pdf/10/2013/2013-ohio-1675.pdf
http://apps.americanbar.org/ababoards/blog/blogpost.cfm?threadid=30049&catid=14923
http://www.oyez.org/cases/1960-1969/1966/1966_39
http://caselaw.findlaw.com/wi-supreme-court/1604209.html
http://www.wipo.int/export/sites/www/pctcaselawdb/en/docs/pct-2006-0002.pdf
http://cases.laws.com/missouri-bf-et-al-v-abbott-laboratories-inc-et-al.pdf
http://www.delawareiplaw.com/etypharm.pdf
https://casetext.com/case/estate-of-rath-v-abbott-laboratories-inc#.U093IvmSySo
http://www.clearinghouse.net/detail.php?id=8886
https://www.courtlistener.com/illappct/bADn/vickers-v-abbott-laboratories/
http://community.freepatentsonline.com/federal-cases/f3d/124/124-f3d-1419-id746412.html
http://www.hugheshubbard.com/ArticleDocuments/
Journal_Patent_Trademark_August_2001.pdf
https://www.azag.gov/press-release/ag-horne-reaches-100-million-settlement-abbott-
laboratories
AG Horne Reaches $100 Million Settlement with

Abbott Laboratories
PHOENIX (Monday, May 7, 2012) -- Attorney General Tom Horne today joined 44 other states and
the District of Columbia in announcing a $100 million settlement with Abbott Laboratories over
allegations of illegal off-label marketing of its Depakote drug.
The agreement marks the largest consumer protection-based pharmaceutical settlement ever reached.
Arizona will receive nearly $2 million and the Illinois-based Abbott will be restricted from marketing
the drug for off-label uses not approved by the U.S. Food and Drug Administration.
Depakote is approved for treatment of seizure disorders, mania associated with bipolar disorder and
prophylaxis of migraines, but the attorneys general alleged Abbott marketed the drug for treating
unapproved uses, including schizophrenia, agitated dementia and autism.
“Consumers need to be able to trust the health care system, and that includes ensuring that
pharmaceutical companies market their products appropriately,” Horne said. “This settlement shows
that this office and my colleagues nationwide will not tolerate the improper marketing of medicines
that affect peoples’ physical and mental well-being.”
In a complaint filed today along with the settlement agreement, the states alleged Abbott engaged in
unfair and deceptive practices when it marketed Depakote for off-label uses.
As a result of the states’ investigation, Abbott has agreed to significantly change how it markets
Depakote and to cease promoting off-label uses. The company also will pay $100 million nationally.
As part of this settlement, Arizona will receive $1,964,188.00 in settlement funds from the company to
be deposited into the Consumer Fraud Revolving Fund pursuant to A.R.S. § 44-1531.01.
Under the settlement, Abbott Laboratories is:
 Prohibited from making false or misleading claims about Depakote,

 Prohibited from promoting Depakote for off-label uses, and
 Required to ensure financial incentives on sales do not promote off-label uses of Depakote.
In addition, for a five-year period Abbott must:
 Limit the creation and use of responses to requests by physicians for non-promotional
information about off-label uses of Depakote,
 Limit dissemination of reprints of clinical studies relating to off-label uses of Depakote,
 Limit use of grants and CME,
 Disclosure of payments to physicians, and
 Register and disclose clinical trials.
Attorneys General of the District of Columbia and the following states participated in today’s
settlement: Alabama, Alaska, Arizona, Arkansas, California, Colorado, Connecticut, Florida, Hawaii,
Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Maine, Maryland, Massachusetts, Michigan,
Minnesota, Mississippi, Missouri, Montana, Nebraska, Nevada, New Jersey, New Mexico, New York,
North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina,
South Dakota, Tennessee, Texas, Utah, Vermont, Virginia, Washington, West Virginia and Wisconsin.
Related Terms:
Enforcement Action
http://business.cch.com/plsd/SecNatBankvAbbott.pdf
IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF IOWA
WESTERN DIVISION
THE SECURITY NATIONAL BANK OF
SIOUX CITY, IOWA, as Conservator for
J.M.K, a Minor,
Plaintiff,
No. C 11-4017-MWB
vs.
MEMORANDUM OPINION AND
ORDER REGARDING THE
DEFENDANT’S MOTIONS FOR
SUMMARY JUDGMENT, TO
EXCLUDE PLAINTIFF’S
CAUSATION EXPERTS, AND TO
STRIKE AFFIDAVIT1
http://www.atg.wa.gov/pressrelease.aspx?id=29722#.U06S2PmSySo
Huge seizure-drug settlements recover $12 million for Washington

state
Settlements involving consumer protection, Medicaid claims over illegal marketing of Depakote
SEATTLE – Working with other states, attorneys for the Washington State Attorney General’s Office
have recovered more than $12 million through settlements with Illinois-based Abbott Laboratories,
accused of illegally marketing an anti-seizure drug. The state will recover more than $10 million, split
with the federal government, in a multi-state Medicaid fraud case against the company and more than
$2 million from a consumer protection case.
“Both consumers and our state's Medicaid program were harmed by the illegal marketing of Depakote,”
said Washington State Attorney General Rob McKenna. “We’re pleased that Abbott Labs is paying
millions to resolve both sets of claims.”
Depakote is FDA-approved for treatment of seizure disorders, symptoms of manic depression and the
prevention of migraines. The states allege Abbott defrauded the Medicaid program and engaged in
unfair and deceptive practices when it marketed Depakote for off-label uses, such as for the treatment of
schizophrenia, agitated dementia and autism.
Medicaid fraud
Washington state joined with other states and the federal government to reach an agreement with
Abbott Laboratories settling civil and criminal allegations that the company illegally marketed
Depakote. As part of the settlement, Washington state will receive $10,266,515 in restitution and other
recoveries. About half of the proceeds are returned to the federal government to cover its share of
spending on the drug in Washington state. Remaining proceeds are split between the Medicaid program
and the general fund. Settlement payments in drug cases are based on the number of drugs sold in the
state during the time in question
The states contend that from January 1998 through December 31, 2008, Abbott promoted the sale and
use of Depakote for uses that were not approved as safe and effective by the Food and Drug
Administration (FDA). The alleged conduct resulted in medical professionals prescribing the drug to
Medicaid patients when they wouldn’t have otherwise done so. Government attorneys also claim that
Abbott Laboratories made false and misleading statements about the safety, efficacy, dosing and cost-
effectiveness of Depakote for some unapproved uses; improperly marketed the product in nursing
homes; and paid illegal fees to health care professionals and long-term care pharmacy providers to
encourage them to promote and/or prescribe the drug.
The $1.5 billion national settlement is the second largest recovery from a drug company in a single civil
and criminal settlement. Abbott will pay the states and the federal government a total of $800 million
in civil damages and penalties to compensate Medicaid, Medicare, and various federal healthcare
programs for harm suffered as a result of its conduct. In addition to the civil settlement, Abbott
Laboratories pled guilty this morning to a violation of the Food, Drug, and Cosmetic Act (FDCA) and
agreed to pay a criminal fine and forfeiture of $700 million.
A total of 49 states, plus the District of Columbia, are participating in the Medicaid settlement. Abbott
also settled a separate case pressed by state attorneys general related to individuals not covered by
Medicaid.
Consumer protection case
In a complaint filed today along with the settlement agreement, the states allege Abbott engaged in
unfair and deceptive practices when it marketed Depakote for off-label uses. Illegal marketing tactics
listed in court documents include:
 The company’s distribution of studies that showed Depakote was effective to treat conditions
for which it was not approved;
 Abbott-sponsored continuing medical education courses in which speakers were selected based
on their willingness to promote off-label uses for the drug;
 Abbott’s conducting of a study relating to the treatment of schizophrenia: even though the
study showed Depakote to be ineffective, the company failed to disclose the results in a timely
fashion;
 The continued promotion of Depakote to treat agitation related to dementia, even after
company representatives knew about a clinical trial that found Depakote to be ineffective.
McKenna today announced Washington state joined 45 other states and the District of Columbia in a
$100 million consumer protection settlement with the drug maker. Washington state’s share is
$2,015,000.
McKenna indicated to the court that settlement funds will be used to provide direct treatment,
medication or counseling to people suffering from schizophrenia, dementia or autism. An open and
competitive grant process for nonprofit organizations or agencies will be used to determine the
recipients.
“This settlement is a reminder that individuals suffering from schizophrenia, dementia and autism – and
their families – seek medications that might provide relief,” McKenna said. “Abbott Laboratories sought
to exploit that need. And that is why we’re setting this money aside to help the same people who still
seek relief."
Under the settlement, Abbott Laboratories is prohibited from making false or misleading claims about
Depakote, promoting the drug for off-label uses, and they are also required to ensure financial incentives
on sales do not promote off-label uses.
In addition, for a five-year period, Abbott must:
 Limit the creation and use of responses to requests by physicians for non-promotional
information about off-label uses of Depakote;
 Limit dissemination of reprints of clinical studies relating to off-label uses of Depakote;
 Limit use of grants and continuing medical education courses;
 Disclose of payments to physicians, and;
 Register and disclose clinical trials.
Attorneys General of the District of Columbia and the following states participated in today’s
settlement: Alabama, Alaska, Arizona, Arkansas, California, Colorado, Connecticut, Florida, Hawaii,
Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Maine, Maryland, Massachusetts, Michigan,
Minnesota, Mississippi, Missouri, Montana, Nebraska, Nevada, New Jersey, New Mexico, New York,
North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina,
South Dakota, Tennessee, Texas, Utah, Vermont, Virginia, Washington, West Virginia and Wisconsin.
-30-
Contacts:
Janelle Guthrie, Director of Communications, (360) 586-0725
http://articles.baltimoresun.com/2010-12-06/health/bs-md-senate-stent-report-
20101205_1_midei-stent-abbott-laboratories
Federal report on stent procedures finds potential

fraud
Investigators question whether doctor's relationship with stent maker encouraged
unnecessary medical procedures
December 06, 2010|By Tricia Bishop, The Baltimore Sun
While Dr. Mark Midei was allegedly implanting unnecessary cardiac stents in hundreds of patients at a Towson
hospital, stent manufacturer Abbott Laboratories was paying for crab and barbecue feasts at his Monkton home
and building a business strategy around the Maryland cardiologist's high output, according to a federal report being
released today.
Abbott, a $30 billion-a-year, Chicago-based pharmaceutical firm, ranked Midei among its top-volume doctors in
the Northeast and made plying him with research money and "VIP trips" part of its business plan in late 2008 —
about the time Midei's usage of Abbott-brand stents soared, the report said.
The 170-page document contains the findings of a months-long investigation by the U.S. Senate Committee on
Finance into allegations of inappropriate and potentially harmful cardiac procedures performed by Midei at St.
Joseph Medical Center. It calls the case "a clear example of potential fraud, waste and abuse," noting that St.
Joseph billed government and private insurers more than $6.6 million for the procedures.
Committee Chairman Sen. Max Baucus also raised concerns in a statement that "this could be a sign of a larger
national trend of wasteful medical device use." Similar allegations have been made against cardiologists in at least
three other states and elsewhere in Maryland.
"Hospital patients expect their care to be based on medical need, not profits," the Montana Democrat said. "This
report sets forth alarming evidence that patients at St. Joseph's Medical Center received unnecessary and
potentially harmful stent implants time and again — a pattern that is shocking, disturbing and shameful.
"Doctors should not be performing invasive medical procedures patients don't need, and taxpayers certainly
shouldn't be paying for these wasteful and improper implantations."
The Senate report includes dozens of e-mails, letters and other documents, subpoenaed by the committee, that
reveal a cozy and sometimes lucrative relationship between Midei, St. Joseph and Abbott. In one exchange, Abbott
officials congratulated Midei for implanting 30 stents in one day, calling it a record and describing the physician as
"one of the highest implantors [sic] thus far."
Investigators for the Senate Finance Committee, which has long been concerned about inappropriate relationships
between pharmaceutical companies and physicians, said their investigation raises questions about "whether or not
Abbott Laboratories indirectly encouraged Dr. Midei to intensify his use of stents, with unfortunate results."
Abbott declined to answer questions Friday, but issued a statement saying, "Dr. Midei has been a highly regarded
physician in his field, with whom Abbott had consulted in the past. Our affiliation with Dr. Midei ended early this
year."
St. Joseph said it had not seen the report and declined to answer questions Friday, while Midei's attorney, Stephen
L. Snyder, dismissed it, saying simply: "Big deal."
Among other details in the Senate report:

• Abbott paid for social events at Midei's home, including a "beers and crabs" dinner and a whole-pig barbeque for
employees of the St. Joseph cardiac lab. A company official also lauded an Abbott saleswoman for her business
relationship with Midei, calling it the strongest the official has seen in 15 years.
• Abbott officials enlisted Midei as a paid consultant after he was forced out of St. Joseph, calling it the right thing
to do because "he helped us so many times over the years." The company paid him more than $30,000 to market
its "Xience V" stent in Japan, after the media climate in the United States became "too hot."
• The company noted an "ugly" decline in the volume of stent procedures at hospitals throughout the Baltimore
region after the allegations against Midei became public, including a 46 percent drop at St. Joseph.
• One Abbott official suggested that local connections or the "Philly mob" should intervene to silence Baltimore
Sun columnist Jay Hancock for his coverage of the scandal, saying "someone needs to take this writer outside and
kick his ass!"
The report does not offer recommendations or outline a next step, though some safety measures have already been
added through recent legislation, Baucus said.
"Aggressive new tools, like improved screening of medical providers and increased oversight, [were included] in
the new health care reform law to root out fraud, waste and abuse like this," Baucus said.
The U.S. Senate committee, which oversees the taxpayer-funded Medicare and Medicaid programs, launched the
investigation in February after a story in The Sun about Midei's questionable procedures. The inquiry focused on
Midei, St. Joseph and Abbott, which manufactures the stents that Midei typically used during his last year of work
at the hospital, which ended in May 2009.
Related Article
Maryland Hospital Stent Surgeries Raise Questions of Fraud
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1 1 0
By: Staff Writers | Published: December 7th, 2010
St. Joseph Medical Center in Towson, Maryland has attempted to label Dr. Mark Midei as a rogue
doctor who placed unnecessary heart stents in hundreds of patients who did not need them. However, a
new report released by the U.S. Senate suggests he may not have been acting as independently as
previously suggested.
A report issued this week by the U.S. Senate Finance Committee raises serious questions about
whether Abbott Laboratories, the manufacturer of the stents used in the procedures, was more closely
involved with Midei’s allegedly fraudulent activities than was previously revealed.
The report calls the situation a “clear example of potential fraud, waste and abuse,” describing financial
payments, gifts and other benefits Abbott showered on Dr. Midei as he implanted more stents in
patients then nearly any other cardiologist in the region. The Maryland hospital also benefited greatly by
the actions of Dr. Midei, billing more than $6.6 million for patients who received medically unnecessary
stents between 2007 and 2009.
All of the allegedly unnecessary stents implanted by Dr. Midei were made by Abbott Laboratories, and
the report reveals that once Midei was fired by the Maryland hospital at the start of the investigation,
Abbot Laboratories hired him as a consultant on coronary stent sales.
Federal investigators say that while he worked at St. Joseph Medical Center, Dr. Midei implanted nearly
600 coronary stents thatt my not have been necessary from 2007 through mid-2009. In some cases, he
allegedly told patients that they had blockages of 90% or more when in fact their blockages were
negligible.
Following patient complaints and the start of a federal investigation, St. Joseph sent hundreds of letters
to patients alerting them that they may have undergone unnecessary heart surgery and removed Dr.
Midei from his position at the hospital.
Stent procedures, which are designed to prop open arteries that are significantly blocked, can cost
$10,000 or more. Typically it is necessary for there to be at least a 70% artery blockage for a stent
implant to be necessary, and many patients who received these letters were originally told that they had
blockages over that amount. However, after a subsequent review of records from the procedure, many
of the patients were found to have blockages that were well under 50%, which is generally considered
“insignificant.” Some patients who received stents had blockages as low as 10%.
According to the Senate report, Dr. Midei’s allegedly fraudulent implants cost the Medicare program
about $3.8 million. However, the report also sheds light on the interactions between Dr. Midei and
Abbott, which appear to show that the company was supportive of Dr. Midei’s efforts. While it is unclear
whether the company knew the stent operations were unnecessary, Abbott showed unflagging support
after the doctor was accused of wrongdoing and looked for ways to take advantage of his ability to sell
stents.
In August 2008, Dr. Midei implanted 30 Abbott Laboratory cardiac stents into different patients in one
day, and the company held a pig roast at his home in his honor two days later. At one point, in internal
e-mails, an Abbott Laboratories executives inquired whether anyone had connections with the “Philly
mob” in order to have a Baltimore Sun reporter beaten for articles critical of medical device companies
that both manufacture and market their products, which was sent after the blow up from the Midei stent
scandal.
Thousands of documents from Abbott detail how the company singled out Dr. Midei and St. Joseph as
top stent sellers in an operation known as “Project Victory.” Action items in Abbott documents called for
the company to “continue to elevate Mark Midei and the St. Joseph’s group within the Abbot Corp” for
senior management visits, research and “VIP Trips.”
Dr. Midei’s house appeared to be a nexus of sales celebration for Abbott Laboratories. In addition to the
$1,235 pig roast, Abbott employees were reimbursed for $690 crab dinners at Dr. Midei’s home and
also took part, along with other medical device companies, in financing a staff Christmas party at Dr.
Midei’s home in 2008.
The close relationship did not end after Dr. Midei came under investigation. Internal Abbott documents
also show that the company has paid him more than $30,000 after his resignation from St. Joseph,
about 10 times what he was paid specifically by the company previously. Abbott representatives also
suggested using Dr. Midei to boost sales in China and Japan, but recommended he be kept out of
events in the U.S.
The documents come at a time when more and more ethics experts are sounding the alarm about the
close relationships between doctors and medical device and pharmaceutical corporations which may
not be serving patients’ interests.
Last month, St. Joseph reached a $22 million settlement with the Department of Justice (DOJ) as part of
a whistleblower lawsuit resulting from the stent scandal and its relationship with MidAtlantic
Cardiovascular Associates (MACVA), which referred patients to the hospital for stent procedures. The
DOJ charged the hospital with giving the group illegal kickbacks.
There continue to be a number of stent lawsuits against St. Joseph Medical Center, which were filed by
individuals who received an unneeded stent. The lawsuits seek compensation from the hospital for
damages associated with the unnecessary medical procedures and for problems associated with having
a stent that never should have been implanted
- See more at: http://www.aboutlawsuits.com/maryland-hospital-stent-surgery-fraud-14723/

#sthash.4ALfBawm.dpuf
http://www.consumeradvocatelegalupdate.com/2010/12/articles/medical-negligence-
malpractice/stenting-scandal-incriminates-doctor-and-abbott-laboratories/
As a plaintiffs’ attorney focusing on mass tort pharmaceutical litigation, I’ve come to develop a
special hatred for most pharmaceutical companies, considering them amongst the lowest
scum of the earth. Sadly enough, I have recently found a lower scum, doctors who are
puppets for the deceptive pharmaceutical companies.
We as a society hold doctors on a pedestal. Theirs is a profession of character and integrity,

one that we all at one point might have aspired to become a part of. Heck, I would have been
a doctor had I not realized that I couldn’t stand blood or touch a needle. So it comes as no
surprise that I’m thoroughly disappointed and disgusted when I read a story about a doctor
who performs unnecessary medical procedures for kickbacks and personal favors!
Recently, the Senate Finance Committee started investigating Dr. Mark Midei of St. Joseph
Hospital in Towson, Maryland, after a numbers of articles in The Baltimore Sun alleged that
he was improperly implanting hundreds of cardiac stents in patients for blockages or
narrowing of the coronary arteries which are typically treated without a stent.
The 170 page report released after the investigation states that he “may have implanted 585
stents which were medically unnecessary” from 2007 to 2009, reaping $6.6 million for
those procedures, of which $3.8 million was paid for by Medicare.
The report also delves into the inappropriately close relationship between Dr. Midei and
Abbott Laboratories, the manufacturer of the stents that he was implanting. Internal company
emails subpoenaed for the investigation indicate that Abbott ranked Midei among its top-
volume doctors and rewarded him with research money and VIP trips. Despite the ethical and
legal issues that surfaced about Dr. Midei, Abbott still hired him as a consultant to assist the
company in marketing its stents in Japan and to help launch its newest stent, the Xience V.
Unfortunately, this isn’t the first physician caught in bed with a pharmaceutical company and
definitely won’t be the last.
http://www.bizjournals.com/boston/blog/bioflash/2013/03/boston-scientific-hit-with-
suit.html?page=all
Mar 15, 2013, 2:42pm EDT UPDATED: Mar 15, 2013, 3:04pm EDT
Boston Scientific hit with suit

claiming employee breach of
contract
Enlarge Photo
Don Seiffert
BioFlash Editor-Boston Business Journal
Email | Twitter
Illinois-based drug and medical device giant Abbott Laboratories has
filed a lawsuit against Boston Scientific and an employee at the Natick,
Mass.-company, claiming breach of contract relating to the poaching of
Abbott employees.
The case was filed Wednesday in the U.S. District Court for the
Northern District of Georgia. In the lawsuit, Abbott says that its former
division vice president of coronary and endovascular U.S. sales for its
vascular unit, Samuel Conaway, approached a handful of Abbott
employees to follow him after being hired by Boston Scientific in
January. Abbott says that it has lost three of those employees in recent
weeks.
Abbott said it has an agreement with Conaway which bars him from
directly or indirectly soliciting or assisting in soliciting certain Abbott
employees, and Abbott provided a copy of the agreement to Boston
Scientific upon his hiring at Boston Scientific.
“Despite full awareness of Conaway’s contractual obligations to Abbott,
Boston Scientific and Conaway have solicited, in some cases
successfully, employees of Abbott in breach and tortious interference
with Conaway’s contractual obligations,” the complaint reads.
Abbott is alleging breach of contract and tortious interference with
contract. It is seeking an order barring Conaway and Boston Scientific
from raiding its staff as well as compensatory, incidental,
consequential and punitive damages.
Abbott spokesman Scott Stoffeel said in a statement that “Abbott
intends to protect our investment in our people and confidential
information.”
Boston Scientific did not have a comment for this article as of deadline.
This is the second lawsuit filed against Boston Scientific this month.
Last week, Florida medical device company OrbusNeich Medical Inc.
filed a patent infringement lawsuit in Ireland against Boston Scientific
Corp. (NYSE: BSX) regarding several lines of its coronary stents,
adding to other suits filed last month in Germany and the Netherlands.
Boston Scientific's stock was down 2 percent on Friday.
http://www.coloradoattorneygeneral.gov/press/news/2012/10/05/
attorney_general_announces_46_million_settlement_abbott_laboratories_over_drug
ATTORNEY GENERAL ANNOUNCES

$4.6 MILLION SETTLEMENT WITH
ABBOTT LABORATORIES OVER THE
DRUG DEPAKOTE
10/05/2012
DENVER – Colorado Attorney General John Suthers today announced that the State of
Colorado received settlement funds from pharmaceutical manufacturer Abbott Laboratories.
The settlement resolves improper marketing allegations surrounding the drug Depakote
which is used to treat various types of seizure disorders as well as manic episodes
associated with bipolar disorder. Federal Medicaid program losses in Colorado totaled more
than $4.6 million. Because the states share in the funding of Medicaid, $2.3 million will go
to the federal government for damages with $1.9 million to Colorado.
“These funds are a significant recovery for Colorado healthcare programs,” said Attorney
General Suthers. “This case should send the message that Colorado stands ready to
pursue providers who threaten the integrity of the state health care system and put at risk
funds that are intended to benefit needy Coloradans.”
The money Colorado received is part of a multi-state $1.5 billion settlement of alleged off-
label marketing and misbranding announced in May 2012. The allegations included that
Abbott marketed Depakote for a variety of other conditions for which it was not approved,
including schizophrenia, depression, attention deficit disorder (A.D.D.), and anxiety; and to
child and adolescent patients. Although physicians are generally free to prescribe drugs for
non-approved (“off label”) uses, government health care programs such as Medicaid will
not reimburse providers for such prescriptions.
The company is also alleged to have marketed the drug specifically to control behavioral
disturbances in nursing home patients, and to have paid illegal remuneration to health
care professions and long-term care, pharmacy providers to induce them to promote
and/or prescribe Depakote. This settlement is based on four cases that were consolidated
and resolved in the United States District Court for the Western District of Virginia in
Abingdon, Virginia.
Abbott will pay the states and the federal government a total of $800 million in civil
damages and penalties to compensate Medicaid, Medicare, and various federal healthcare
programs for harm suffered as a result of its conduct. In addition to the civil settlement,
Abbott Laboratories pled guilty in the federal District Court for the Western District of
Virginia in May 2012 to a violation of the Food, Drug, and Cosmetic Act (FDCA) and on
October 2, 2012, pursuant to a plea agreement, was ordered to pay a criminal fine and
forfeiture of an additional $700 million. Further as a condition of the settlement, Abbott
Laboratories will enter into a Corporate Integrity Agreement with the United States
Department of Health and Human Services, Office of the Inspector General.
The settlement was facilitated in Colorado by the Attorney General’s Medicaid Fraud
Control Unit (MFCU), and Colorado MFCU personnel participated on the national litigation
team and in the settlement negotiations. The State of Colorado pays out roughly $4.5
billion per year for the medical care of almost 700,000 qualified recipients. The 17-member
MFCU is tasked with the investigation and prosecution of provider fraud against the state
Medicaid program, as well as physical and financial abuse of seniors and other residents of
federally funded long-term care facilities.
http://www.healthcarecompliance.us/medicaid-fraud-case-gets-settled.html
Medicaid Fraud Case Gets Settled

Filled under: Healthcare Compliance on October 2012
No less than $16 million will be received by North Carolina state from a national Medicaid
fraud settlement. The case involves one of the largest drug makers in the United States.
Since Abbott Laboratories agreed to pay the money, the Food and Drug Administration
(FDA) dropped all charges against the company. The famous drug manufacturer was
accused of promoting Depakote for unapproved uses. The Food and Drug Administration
has approved Depakote only for bipolar mood disorder and seizures control. Nevertheless,
Abbott Laboratories did not limit their publicity to those particular uses.
Source
Federal prosecutors claimed that Abbott Laboratories have promoted Depakote as an
efficient treatment for schizophrenia, agitated dementia and autism, too. According to the
law, even though doctors can prescribe legal drugs for uses that have not been approved
by the FDA, companies are banned from promoting them for such additional uses.
Most of the money that Abbott Laboratories paid will be used to found the state’s Medicaid
program. About $1 million from the sum will be invested in the support of public schools.
Consequently, $14.8 million will go to Medicaid efforts support.
The settlement with Abbott Laboratories is just one of the many similar cases recorded in
the past few years. A report launched by Public Citizen group back in September, 2012,
indicated that the number of fraud cases in the United States medical system has much
increased. The same report showed that more than $30 billion have been collected by
prosecutors for settling alleged fraud allegations against drug companies.

Source
The law in the United States indicates that drug companies are allowed to launch new
products only if they have been approved by the Food and Drug Administration. Drugs can
be used and promoted just for the uses FDA has accepted. However, in the past few years
numerous cases of companies promoting their medications for other uses, as well, have
been registered. State attorneys have perused all cases which involved promoting drugs
for unapproved uses.
However, it has been debated that federal prosecutors settle Medicaid fraud cases too
easily. Penalties are given due to unlawful promotion of drugs, but companies get away
easier than they should. GlaxoSmithKline, Johnson & Johnson, but also Abbott Laboratories
have paid alone more than $3.1 billion in settlements.
In the video below you can find out more on how GlaxoSmithKline has several times been
prescribed for uses that have not been approved by the FDA.
It surely looks like in many cases prosecutors have decided to settle cases with companies
which violated Medicaid and FDA regulations. Thanks to the money obtained under these
agreements, the state has made quite a fortune. Compliance with healthcare fraud
regulations and actually with all rules that function in the healthcare industry is highly
important. In case such regulations are not respected, providers will have to respond in
court.
http://www.healthcarecompliance.us/medicaid-fraud-case-gets-settled.html
Filled under: Healthcare Compliance on October 2012
No less than $16 million will be received by North Carolina state from a national Medicaid
fraud settlement. The case involves one of the largest drug makers in the United States.
Since Abbott Laboratories agreed to pay the money, the Food and Drug Administration
(FDA) dropped all charges against the company. The famous drug manufacturer was
accused of promoting Depakote for unapproved uses. The Food and Drug Administration
has approved Depakote only for bipolar mood disorder and seizures control. Nevertheless,
Abbott Laboratories did not limit their publicity to those particular uses.
Source
Federal prosecutors claimed that Abbott Laboratories have promoted Depakote as an
efficient treatment for schizophrenia, agitated dementia and autism, too. According to the
law, even though doctors can prescribe legal drugs for uses that have not been approved
by the FDA, companies are banned from promoting them for such additional uses.
Most of the money that Abbott Laboratories paid will be used to found the state’s Medicaid
program. About $1 million from the sum will be invested in the support of public schools.
Consequently, $14.8 million will go to Medicaid efforts support.
The settlement with Abbott Laboratories is just one of the many similar cases recorded in
the past few years. A report launched by Public Citizen group back in September, 2012,
indicated that the number of fraud cases in the United States medical system has much
increased. The same report showed that more than $30 billion have been collected by
prosecutors for settling alleged fraud allegations against drug companies.

Source
The law in the United States indicates that drug companies are allowed to launch new
products only if they have been approved by the Food and Drug Administration. Drugs can
be used and promoted just for the uses FDA has accepted. However, in the past few years
numerous cases of companies promoting their medications for other uses, as well, have
been registered. State attorneys have perused all cases which involved promoting drugs
for unapproved uses.
However, it has been debated that federal prosecutors settle Medicaid fraud cases too
easily. Penalties are given due to unlawful promotion of drugs, but companies get away
easier than they should. GlaxoSmithKline, Johnson & Johnson, but also Abbott Laboratories
have paid alone more than $3.1 billion in settlements.
In the video below you can find out more on how GlaxoSmithKline has several times been
prescribed for uses that have not been approved by the FDA.
It surely looks like in many cases prosecutors have decided to settle cases with companies
which violated Medicaid and FDA regulations. Thanks to the money obtained under these
agreements, the state has made quite a fortune. Compliance with healthcare fraud
regulations and actually with all rules that function in the healthcare industry is highly
important. In case such regulations are not respected, providers will have to respond in
court.
http://www.yourhoustonnews.com/cypresscreek/news/texas-receives-million-
settlement-from-abbott-laboratories-medicaid-fraud-case/article_439766de-
9882-11e1-9528-0019bb2963f4.html
Texas receives $14 million

settlement from Abbott
Laboratories' Medicaid fraud
case
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Posted: Monday, May 7, 2012 3:21 pm | Updated: 3:34 pm, Mon May 7, 2012.
From the Texas Attorney General's Office
Texas Attorney General Greg Abbott and other state attorneys general today resolved a two-phase
Medicaid fraud and deceptive marketing investigation into Abbott Laboratories. The investigation
centered on the unlawful promotional scheme that Abbott Laboratories launched to increase the sales of
its anti-seizure drug Depakote.
Attorney General Abbott made the following statement about the settlement, which allocates $14 million
to the State of Texas for improper Medicaid overpayments, and an additional $5.8 million for violations
of the Deceptive Trade Practices Act:
“It is against the law for drug manufacturers to promote their drugs for unapproved uses, but Abbott
Labs did just that. In an apparent effort to expand the use of its drug, Abbott Labs overstepped. The
agreement reached last week holds the company accountable for violating the law and defrauding the
taxpayer-funded Medicaid program.”
In an enforcement action filed along with the consumer fraud settlement, the attorneys general assert
that Abbott Laboratories went far beyond urging physicians to prescribe Depakote for seizure disorders
such as epilepsy, which is an approved use. The company promoted the “off-label” use of Depakote in
treating schizophrenia, agitated dementia and autism, uses not approved by the U.S. Food and Drug
Administration. In the separate Medicaid fraud case, the company also unlawfully exploited the state’s
Medicaid program in marketing Depakote from 1998 until 2008.
Under the settlement, Abbott Laboratories must not make false claims about Depakote’s benefits or
promote it for off-label uses. Regarding future sales of the drugs and financial incentives, the company
must ensure that such incentives do not promote off-label uses of the drug.
Under the Texas portion of the civil Medicaid fraud settlement, Texas will receive about $14 million to
include payment to the general revenue, relators’ fees and attorneys’ fees. Under the consumer
protection portion of the award, $3.9 million will be allocated to general revenue and $1.95 million to
State attorneys’ fees.
http://www.ibtimes.co.uk/glaxosmithkline-wins-retrial-abbott-labs-aids-drug-
pricing-case-1433287
GlaxoSmithKline Wins Retrial in Abbott Labs AIDS Drug Pricing Case

 By M Rochan
January 22, 2014 08:56 GMT
 31
GlaxoSmithKline wins retrial in Abbott AIDS drug pricing case over gay juror's ouster.Reuters
A US federal appeals court has ordered a new trial for GlaxoSmithKline's AIDS
drug pricing case against an Abbott Laboratories offshoot, because Abbott
excluded a potential gay juror.
The 9th US Circuit Court of Appeals in San Francisco ruled that a gay man was
incorrectly excluded from jury service because of his sexual orientation, with the
ruling exemplifying the growing influence of a 2013 US Supreme Court decision
on gay rights.
“Gays and lesbians deserve the same constitutional protections during jury
selection as those enjoyed by African-Americans and women.”
- The 9th US Circuit Court of Appeals in San Francisco
The 9th Circuit on Tuesday cited US versus Windsor, the US Supreme Court
decision in 2013 that annulled part of the federal Defense of Marriage Act
(DOMA). In that case, Justice Anthony Kennedy wrote that the law defining
marriage as between one man and one woman violated the US Constitution's
guarantee of equal protection.
In the wake of the legal reasoning in Windsor, the 9th Circuit held that gays and
lesbians deserved the same constitutional protections during jury selection as
those enjoyed by African-Americans and women.
Pursued by Reuters, Glaxo spokeswoman Mary Anne Rhyne said the firm was
pleased with the decision.
Abbott spin-off AbbVie's representative Adelle Infante said the company was
evaluating its options.
However, Judge Kennedy's 2013 ruling did not clarify as to how far gay rights
protections ought to extend, Northwestern University law professor Andrew
Koppelman told the news agency.
"Strikes exercised on the basis of sexual orientation continue this deplorable

tradition of treating gays and lesbians as undeserving of participation in our
nation's most cherished rites and rituals," 9th Circuit Judge Stephen Reinhardt
wrote for a unanimous three-judge panel.
Juror strikes based on sexual orientation "deprive individuals of the opportunity to

participate in perfecting democracy and guarding our ideals of justice on account
of a characteristic that has nothing to do with their fitness to serve," Reinhardt
added.
"The big difference between now and Windsor is a shift in the culture,"
Koppelman said. "Discrimination that made intuitive sense to people before
doesn't make a whole lot of sense anymore."
AIDS Drug Pricing Case
The British drug maker is suing Abbott over its 2003 decision to raise the price of
an AIDS drug, a contentious issue in the gay community.
Abbot hiked the price of a drug called Norvir by 400%. The move, according to
Glaxo, undercut a Glaxo drug, Lexiva, used in AIDS-fighting cocktails in
combination with Norvir.
Glaxo had sought $571m in damages but the jury awarded it $3.5m in 2011.
During jury selection for that trial in an Oakland, California federal court, Abbott's
attorney sought to exclude the gay juror.
Glaxo objected, saying that Abbott was trying to use a peremptory challenge in a
prejudiced way. However, US District Judge Claudia Wilken allowed Abbott to
exclude the juror.
The case in the 9th Circuit is Smithkline Beecham Corp dba GlaxoSmithKline
versus Abbott Laboratories, 11-17357.
http://www.state.il.us/court/Opinions/AppellateCourt/2012/5thDistrict/5100096.pdf
ILLINOIS OFFICIAL REPORTS
http://isites.harvard.edu/fs/docs/icb.topic220930.files/Product_Liability_Cases_1.doc
SINDELL v. ABBOTT LABORATORIES

California Supreme Court 26 Cal. 3d 588 (1980)
http://www.wicourts.gov/sc/opinion/DisplayDocument.pdf?content=pdf&seqNo=83980
http://www.thaindian.com/newsportal/health1/abbott-laboratories-allows-further-
investigation-on-meridia_100442196.html
Abbott Laboratories Allows Further Investigation On Meridia

10/10/2010 5:53:57 PM by GD
By Meena Kar
Authorities have confirmed that the investigations on the
side-effects of Meridia, a prescription weight loss drug,
will continue. Meridia has come under investigation for
one of its constituents, sibutramine, which is an appetite
suppressant. Meridia is manufactured by Abbott
Laboratories which agreed for the investigation after
being requested by the FDA. The FDA made the request
after the Sibutramine Cardiovascular Outcomes Trial
(SCOUT) provided the report.
In a recent study, it was revealed that Meridia caused

the risk of heart problems to increase for those who
already have a history of heart related diseases. Earlier there were concerns about the
effect of Meridia with heart problems. On Friday, the federal health officials have confirmed
that the drug has been withdrawn from the United States markets. In Taiwan, Meridia has
been recalled by the health authorities for cardiovascular health concerns and on Saturday,
the drug was withdrawn from the market for the same reasons.
The DOH (Department of Health) said that it was advised by the European Union that the
country put a restriction on all the weight loss drugs containing sibutramine. Meridia, being
the best known among the weight loss drug has been the most highlighted by the media.
More than 300 people complained of uneasiness after using the drug and more than
hundred of them were related to cardiovascular problems. Abbott Laboratories have also
agreed to withdraw the drug from the market after the studies proved that there was a
16% increase in the risk of heart
http://www.oyez.org/cases/1960-1969/1966/1966_39
SEARCH:
ABBOTT LABORATORIES v. GARDNER

Print this Page
Case Basics
Docket No.
39
Petitioner
Abbott Laboratories
Respondent
John W. Gardner, Secretary of Health, Education and Welfare
Decided By
Warren Court (1965-1967)
Opinion
387 U.S. 136 (1967)
Argued
Monday, January 16, 1967
Decided
Monday, May 22, 1967
Advocates
Gerhard A. Gesell
()
Nathan Lewin
()
Tags Judicial PowerJudicial Review

Term:
 1960-1969
o 1966
Location: United States Food and Drug Administration
Facts of the Case
In 1962, Congress amended the Federal Food, Drug, and Cosmetic Act (“FFDCA”) to require
manufacturers of prescription drugs to print the "established name" of the drug "prominently
and in type at least half as large as that used thereon for any proprietary name or designation
for such drug," on labels and other printed material. The purpose of this amendment was to
alert doctors and patients about identical drugs that sold under separate names at different
prices.
The act delegated authority to the Commissioner of Food and Drugs to publish proposed
regulations designed to implement the statute. The Commissioner, George P. Larrick,
published regulations mandating that drug manufacturers print the established drug name
every time its corresponding proprietary name is used.
Abbott Laboratories brought suit against Anthony J. Celebrezze, the Secretary of Health,
Education and Welfare and Larrick under the Declaratory Judgment Act (""DJA"") and the
Administrative Procedure Act (“APA”). Abbott Laboratories argued that the “every time” rule
was outside of the scope of the authority given to the commissioner by Congress.
Chief Judge Caleb M. Wright of the district court granted the declaratory and injunctive relief
sought by Abbott Labs, finding that the FFDCA did not permit the Commissioner’s “every
time” interpretation. The U.S. Court of Appeals, Third Circuit, reversed without touching upon
the interpretation question. District court Judge Weber, writing for a unanimous court, held
that Abbott Labs could not challenge the commissioner’s rule under the DJA or APA. Abbott
Laboratories and 37 other drug manufacturers appealed the decision.
Question
Did Congress authorize judicial review of the commissioner of the FDA’s authority to require
Abbott Laboratories to print the established name of a drug every time its proprietary name is
used?
Argument
Abbott Laboratories v. Gardner - Oral Argument
Conclusion
Decision: 5 votes for Abbott Laboratories, 3 vote(s) against
Legal provision: Federal Food, Drug, and Cosmetic, and related statutes
Yes. Writing for the majority in a 5-3 decision, Justice John Harlan wrote that where the legal
issue is fit for judicial resolution and a regulation requires an immediate and significant
change in plaintiffs’ conduct with potentially serious penalties, the law permits access to the
courts under the APA and the DJA. The Court found that congress did not intend to forbid
pre-enforcement review of regulations like the “every time” rule. The legislature designed the
statute’s specific review provisions to provide additional remedies for parties in Abbott
Laboratories’ position, not to cut down traditional channels of review. The Court remanded the
case to the court of appeals.
Justice Abraham Fortas dissented, joined by Chief Justice Earl Warren and Justice Thomas
Clark. He wrote that courts have jurisdiction over challenges to administrative action only
when there is a specific statutory provision, when the agency acts unconstitutionally, or when
it acts without jurisdiction. Justice Fortas feared that the majority’s ruling would give federal
district judges a “roving commission to halt the regulatory process.” He reviewed the
legislative history of the FFDCA and found that congress had consistently reserved judicial
review for specific situations not including the present case.
Justice Clark wrote a separate dissent arguing that the commissioner was right to prevent
drug manufacturers from misleading the public about the content of their proprietary drugs.
Justice William Brennan took no part in the consideration or decision of the case.
http://caselaw.findlaw.com/wi-supreme-court/1604209.html
http://caselaw.findlaw.com/us-7th-circuit/1593329.html
http://www.marylandinjurylawyerblog.com/2014/01/can-strike-gay-juror-smithkline-
beecham-v-abbott-laboratories.html
January 24, 2014
Can You Strike a Gay Juror? SmithKline

Beecham v. Abbott Laboratories
By Ronald V. Miller, Jr.
Can you strike a juror based

on sexual preference?
This week, the 9th Circuit took this issue on. SmithKline
Beecham v. Abbott Laboratories is a case of two giant drug
companies fighting each other over what I’m sure is already
obscene profits involving the sale of an anti-HIV drug. In the
suit, GlaxoSmithKline accuses Abbott Laboratories of antitrust,
contract, unfair trade practice (UTPA) claims, and instigating
World War I by shooting the archduke. The usual stuff.
But the underlying battle in the case involved the pricing of HIV
medications, a big issue in the gay community. You know the
score here. The drug companies are gouging HIV and AIDS
patients which would be beyond criminal except, let’s face it,
their ingenuity has saved countless lives. While hating on
pharmaceutical companies as I am wont to do, you have to keep
in mind the life saving and pain saving work they have done.
The Critical Facts at Issue in SmithKline Beecham v.

Abbott Laboratories
In voir dire, Abbott struck a gay juror, presumably because
Abbott would look like the bad guy in this case from the “keeping
price of these drugs down” perspective and figured anyone gay
would be predisposed to find against them. How did Abbott’s
lawyer know he was gay? In voir dire questioning, the juror
referred to his partner using the pronoun “he”. So Abbott used
their first strike on this juror. Glaxo challenged the strike, citing
the only juror strike case anyone remembers: Batson v.
Kentucky. That case found that juror strikes may not be used
to exclude jurors based on race because it violated the Equal
Protection Clause. So the question is whether the logic
of Batsoncould be applied to gays.
The trial court judge then quickly carries the water for Abbott’s
counsel, explaining all of the reasons why it is permissible to
strike a juror because he is gay. Incredibly, Abbott’s counsel
then goes on to profess uncertainty whether the prospective
juror was gay. But the judge cuts them off and lets the ruling
stand, saying that she would allow Abbott’s strike and
would reconsider her ruling if Abbott struck other gay men.
Maybe the court’s rule was you get one free gay strike.
The jury found for Abbott on the antitrust, UTPA, and the killing
the archduke claims, but did find for Glaxo on a breach of
contract claim and awarded over $3 million in damages.
Naturally, both parties appealed.
The 9th U.S. Circuit Court of Appeals in San Francisco ordered
a new trial because Abbott excluded the gay juror. His
rationale? Under Supreme Court’s decision in U.S. v. Windsor,
the heightened scrutiny standard should be extended to gays
when they are treated differently.
My Opinion on This
My first reaction is to cheer this decision. In massive numbers,
from Pope Francis on down, people are realizing how wrong the
historic discrimination against gays has been and still is. But I
think the 9th Circuit is kidding itself if it thinks there is precedent
out there that supports this.
I think the 9th Circuit would have been better served by saying,
“This is an issue of first impression. Discrimination is wrong.
Supreme Court, if you disagree, do your thing. Otherwise, this is
the law in the 9th Circuit.”
Related Article:
http://www.huffingtonpost.ca/2013/09/18/abbott-
laboratories-gay-juror_n_3947319.html
http://www.theguardian.com/society/2006/feb/14/health.frontpagenews
 News
 Society
 Health
Drug firm censured for lapdancing junket

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 Sarah Boseley, health editor
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 The Guardian, Tuesday 14 February 2006
One of the world's largest drug companies has been disciplined by the industry's UK
watchdog after admitting that its staff entertained doctors to greyhound racing,
lapdancing and Centre Court tickets at Wimbledon.
The Association of the British Pharmaceutical Authority (ABPI) ruled that the scale of the
hospitality to doctors who might be influenced to prescribe Abbott Laboratories' drugs
breached its code of practice. It suspended the company, which made $3.4bn (£2bn)
profit last year on worldwide sales of $22.3bn, from its board of management for six
months.
An anonymous whistleblower triggered the ABPI investigation when he complained that

drug reps had taken 27 doctors to the greyhound track in Manchester in January 2004
and 36 others in September. He also complained that two Abbott employees had taken a
senior doctor to a lapdancing club, where one of them, a senior manager, borrowed
£1,000 for the evening out from the other, a rep.
Abbott, which makes drugs and testing equipment for cancer, diabetes, HIV and pain
management, said the employees involved had either left the company or been sacked.
The greyhound racing outings had not been approved by head office, it said, because the
cost had not exceeded £40 a head or £2,000 in total.
But the authority said Abbott was "unable to provide a full picture of what had occurred at
these meetings". It added: "The panel considered it highly likely that the meetings were
mainly of a social or sporting nature which was unacceptable under the code." The code
of practice states that prescribing doctors can only be entertained in the context of
educational events - such as lectures or workshops on the use of the company's drugs -
and that the scale of the hospitality must be proportionate and the location appropriate.
The lapdancing visit took place in January 2004 after a workshop. After dinner, one of
Abbott's managers and a rep who had been manning a stand took a hospital doctor out
for the evening. The complainant "stated that the manager borrowed £1,000 from the
local representative towards the evening, telling him he would be fully reimbursed.
However this never materialised and he was still waiting for his money," the ABPI
account of the investigation said.
Abbott argued that the two employees had entertained the doctor in their own time and at
their own expense. But the panel said it breached the code because a potential customer
was involved.
The panel also ruled that Abbott had broken the rules by inviting senior consultants from
London hospitals to Wimbledon in the summer of 2004 and providing them with Centre
Court tickets and "full hospitality". It was also censured for paying a bill for almost £800
for Christmas lunch for 15 hospital staff in December.
Abbott said its understanding of what was acceptable in terms of corporate hospitality
had changed after a ruling against another drug company, Takeda, was published a year
ago. It said it had a "zero tolerance policy" for breaches. The allegations related to "a
small number of employees" who had resigned or had their employment terminated.
http://www.pmlive.com/pharma_news/
abbott_suspended_from_abpi_after_hospitality_breach_8286
Abbott suspended from ABPI after hospitality

breach
Employees entertained doctors at lap dancing club, greyhound stadium and
Wimbledon centre court
Abbott Laboratories is in hot water after employees of the company paid for doctors to
visit lap dancing clubs, a greyhound stadium and Wimbledon centre court in one of the
most serious breaches ever of the ABPI code of practice.
The scandal will be an embarrassment to the ABPI, which has been keen to show that it
has adequate regulation in place to ensure drug promotion in the UK remains ethical.
The penalty meted out reflects the gravity with which the industry association views
Abbott's misdemeanours. The firm has been suspended from ABPI membership for six
months, with readmission subject to an audit in May to verify that the company has taken
adequate remedial action.
The ruling by the ABPI Board of Management, which came in December before the new
ABPI Code of Practice came into force, has just been published in the latest Code of
Practice review. Abbott's suspension became effective from January 1.
After a tip-off by an ànonymous concerned member of the industry', an ABPI panel
found that in January and September of 2004, Abbott employees inappropriately
entertained groups of doctors at a Manchester greyhound stadium while races were taking
place.
Abbott said the two trips had not been approved by head office as the cost had not
exceeded £40 a head or £2,000 in total.
In another incident in February 2004, an Abbott manager and a company representative
attended a lap dancing club with a doctor after a two-day medical workshop. The
complainant alleged that the manager borrowed £1,000 from the representative to pay for
the visit.
The ABPI also found a breach of its code in a third instance, when an Abbott manager
invited senior London hospital consultants for a day of full hospitality at Wimbledon
Centre Court in the summer of 2004.
ìThe pharmaceutical industry strives to maintain the highest possible ethical standards in
all its dealing with healthcare professionals,î said Vincent Lawton, managing director at
Merck, Sharp & Dohme and ABPI president. ìThe breaches that have been identified are
viewed in a very serious light, and this is reflected in the suspension - a sanction that we
have not needed to apply for many years.î
The last time the ABPI suspended a company from membership was in 1994, when two
companies, Duphar and Fisons, fell foul of industry regulations.
In a statement, Abbott said it had a 'zero tolerance' policy towards any breach of the
company's code of conduct.
ìThe allegations made during this case relate to the individual actions of a small number
of employees in 2004,î said the company. ìAbbott conducted a thorough investigation and
as a result, these employees either resigned or had their employment terminated.î
Last month the ABPI announced it had hired PR agency SantÈ Communications to
promote the new Code of Practice, described as the toughest yet for pharmaceutical
marketers by some observers.
More bad news for the industry has arrived in the form of serious allegations being made
against Abbott, which have been aired in the national tabloid press. In an industrial
tribunal in Reading, Julia Jeffers, an ex-Abbott sales rep, is claiming unfair dismissal and
sex discrimination.
Jeffers alleged that her former line manager, Nick Panton, and former unit business
manager, Clive Spiegler, not only sacked her because she knew about various instances of
unethical behaviour including visits to brothels on company trips to Lisbon and Budapest
but also that they failed to act when she complained that she was sexually harassed by a
Birmingham hospital consultant.
Both Panton and Spiegler resigned from the company following a directive from Abbott's
Chicago HQ, the tribunal heard.
Richard Hutchinson, defending Abbott in the case, said Jeffers, who sold HIV drugs, lost
her job because of her poor performance.
The tribunal is expected to come to its decision within 28 days.
http://journalstar.com/news/state-and-regional/statehouse/nebraska-medicaid-fraud-unit-
recoups-million/article_f6244cc6-836f-5e19-bc44-9fe02b79e0d8.html
The Nebraska attorney general's Medicaid Fraud Unit recovered more than $20 million
from fraudulent Medicaid claims filed by service providers and drug companies in 2012.
Attorney General Jon Bruning said the funds would be used to reimburse Medicaid for
losses and to cover legal fees for individual cases.
Bruning said he would not tolerate false Medicaid claims that take state tax dollars. In
one case, the unit returned more than $3.7 million from Abbott Laboratories, a
pharmaceutical company.
The Medicaid Fraud Unit has recovered more than $64.8 million since it was created by
the Legislature to investigate Medicaid provider fraud and patient abuse in 2004. In
2011, the unit recouped more than $6.1 million.
http://www.wipo.int/export/sites/www/pctcaselawdb/en/docs/pct-2006-0002.pdf
http://brandilawblog.com/2014/03/03/big-pharma-fined-3-75-billion-in-fraud-penalties-in-
fiscal-2013/
Big Pharma Fined $3.75 Billion in Fraud

Penalties in Fiscal 2013
According to the U.S. Departments of Justice and Health and Human
Services, these departments recovered$4.3 billion in criminal and civil
fines in the 2013 fiscal year, which ended in September 2013. This is a
$100 million increase from the 2012 fiscal year. The five-year total in fines
has now reached $19.2 billion. Pharma drugmakers in 2013 tallied $3.75
billion – nearly 87% of the total.
Click here to read the full article: Pharma Shelled out $3.75B in Fraud
Penalties in Record-Setting Year, Feds Say
The top 5 fines for the fiscal year were:
1. Abbott Laboratories was fined $1.5 billion for off label

allegations of the seizure drug, Depakote.
2. Amgen paid $762 million to settle marketing violations.
3. Ranbaxy Laboratories settled for $500 million for violating
manufacturing standards and outright lying to the FDA.
4. A $490.9 million settlement agreement with Pfizer’s
Wyeth unit related to illegal marketing of a kidney-transplant prescription
medication, Rapamune (sirolimus).
5. A $109 million fine was issued to Sanofi units to settle
Hyalgan kickback allegations.
The 2014 fiscal year may have just started in October, but big pharma has
already notched two major fines. First, Johnson & Johnson was
fined $2.2 billion for improperly marketing their drug Risperdal. Most
recently,Endo Health Solutions settled for $192.7 million to resolve
Lipoderm off label use.
The practices of improper marketing and failure to warn are at the heart of
the current DePuy and transvaginal mesh litigation that Johnson & Johnson
faces. Drug manufacturers have historically been shown to engage in
improper marketing practices, paying kickbacks to prescribers, concealing
essential information consumers and their physicians need to know,
denying all of that conduct beyond scores of corporate attorneys in
litigation, then attempting to quietly settle the concealment and improper
marketing claims with the federal or State authorities once the civil
litigation has drawn near a close.
Contact Our Experienced San Francisco Drug Recall Lawyers Today

At the Brandi Law Firm, we help people throughout the country who have
been harmed because of a defective drug or medical device such as
women contracting type two diabetes while using Lipitor, people suffering
from bladder cancer while using Actos, Fosamax users suffering atypical
femur fractures, DePuy ASR hip users requiring revisions or suffering toxic
poisoning, and women suffering significant pain, erosion and removal of
vaginal mesh. Instead of treating all victims of defective drugs and
medical devices the same we take a different, more personalized approach
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your legal options and to help you pursue compensation and holding these
drug companies responsible for their dangerous actions. Please contact
the Brandi Law Firm today (1-800-481-1615 or email us) to talk with the
experienced San Francisco defective drug attorneys.
Trademark Notice
Abbott Laboratories, Amgen, Ranbaxy Laboratories, Pfizer, Werth, Sanofi,

Johnson & Johnson, and Endo Health Solutions are registered
trademarks. The use of these trademarks is solely for product
identification and informational purposes. These trademarks are not
affiliated with this website, and the trademarks have no affiliation with the
Brandi Law Firm. Nothing on this site has been authorized or approved by
the trademarks.
http://law.justia.com/cases/federal/appellate-courts/ca9/11-17357/11-17357-2014-01-21.html
SmithKline Beecham Corp. v. Abbott

Laboratories
Justia.com Opinion Summary: GSK filed suit against Abbott over a dispute
related to a licensing agreement and the pricing of HIV medications. The
central issue on appeal was whether equal protection prohibited
discrimination based on sexual orientation in jury selection. GSK contended
that a new trial was warranted because Abbott unconstitutionally used a
peremptory strike to exclude a juror on the basis of his sexual orientation.
The court concluded that GSK had established a prima facie case of
intentional discrimination where the juror at issue was the only juror to have
identified himself as gay on the record and the subject of the litigation
presented an issue of consequence to the gay community. The court held that
classifications based on sexual orientation were subject to a heightened
scrutiny under United States v. Windsor. The court also held that equal
protection prohibits peremptory strikes based on sexual orientation. The
history of exclusion of gays and lesbians from democratic institutions and the
pervasiveness of stereotypes about the group leads the court to conclude that
Batson v. Kentucky applied to peremptory strikes based on sexual
orientation. The court also concluded that a Batson challenge would be
cognizable only once a prospective juror's sexual orientation was established,
voluntarily and on the record. The court rejected Abbott's harmless error
argument. Accordingly, the court reversed and remanded.
Receive FREE Daily Opinion Summaries by Email

Court Description:
Jury Selection. Reversing the district court’s judgment in an antitrust case

concerning a licensing agreement and the pricing of HIV
medications, the panel held that classifications based on
sexual orientation are subject to heightened scrutiny, and in
jury selection, equal protection prohibits peremptory strikes based on sexual
orientation. The panel held that even though the Ninth Circuit had in
the past applied rational basis review, United States v.
Windsor, 133 S. Ct. 2675 (2013) (holding Defense of
Marriage Act unconstitutional), required that heightened
scrutiny be applied to equal protection claims involving
sexual orientation. The panel held that in light of the history
of exclusion of gays and lesbians from democratic institutions
and the pervasiveness of stereotypes about the group, the
protection of Batson v. Kentucky, 476 U.S. 79 (1986), applies,
and equal protection forbids striking a juror on the basis of
SMITHKLINE BEECHAM V. ABBOTT LABORATORIES 3
his sexual orientation. The panel remanded the case for a new trial.
http://www.mccarthy.ca/pubs/Charlton_Abbott_2013_BCSC_1712_CanLII.pdf
Charlton v. Abbott Laboratories, Ltd.,
2013 BCSC 1712 (CanLII)
Date: 2013-09-17
Docket: 11-0721
URL: http://canlii.ca/t/g0lwm
Citation: Charlton v. Abbott Laboratories, Ltd., 2013 BCSC 1712 (CanLII),
<http://canlii.ca/t/g0lwm> retrieved on 2013-10-23
Print: PDF Format
Noteup: Search for decisions citing this decision
Reflex
Record
Related decisions, legislation cited and decisi
http://www.ncbusinesscourt.net/opinions/1999%20NCBC%2010.htm
http://www.talkvietnam.com/tag/abbott-laboratories/
Abbott accuses Song Nam of

fraud, fears for public health
Posted on NOVEMBER 28, 2013 Written by VIR
Abbott, one of the largest diversified global healthcare companies, has accused a Vietnamese firm of
using false documents to import the company's milk products. The letter tothe ministry read in part
"The forged document was a confirmation from East West Trading Partners that Song Nam was an
authorised distributor for Abbott's Ensure products in Vietnam and this is fraudulent." It continued in
saying "East West Trading Partners have no business relationship with Abbott Laboratories and
… [Read more...]
http://www.mlive.com/business/west-michigan/index.ssf/
2012/10/layoffs_at_abbott_laboratories.html
ayoffs at Abbott Laboratories

will have 'some impact' on
Sturgis operation by next
year, company says
Print
By Al Jones | ajones5@mlive.com
Follow on Twitter
on October 18, 2012 at 7:00 AM, updated October 18, 2012 at 7:03 AM
Reddi
t
Abbott Laboratories has
its headquarters in North Chicago, Ill.Courtesy Photo

STURGIS, MI -- A spokeswoman for Abbott Laboratories says the
announcement Wednesday of a 550-job reduction in the drug and
health care products company’s worldwide workforce will not have an
impact on its nutrition products facility in Sturgis.
But she said there will be some impact in Sturgis over the next year.
That is part of an announcement also made by the company on
Wednesday to lay off several hundred more workers worldwide
before the end of 2013.
"We're not providing additional details," said Adelle Infante,
spokeswoman for North Chicago, Ill.-based Abbott. "Abbott remains
committed to Sturgis where it will continue to manufacture
nutritional products."
The Abbott Nutrition facility in Sturgis makes pediatric nutritional
products such as Similac infant formula. The company will not
disclose how many workers it employs there.
Infante said the layoffs are an attempt by the company to align its
resources after assessing the environment and competitive landscape
in which its businesses operate.
“Today's changes enable our businesses to align their resources to
better meet evolving business needs,” she said of the 550-job
reduction, which she said is less than 1 percent of the company's
91,000-person worldwide workforce.
“It’s just an evaluation of the needs of each system – across several
businesses,” Infante said.
Abbott businesses that are affected by the 550-job layoffs include:
global nutrition, vascular business, established pharmaceuticals (a
branded generics business outside the United States) and molecular
diagnostics.
Unaffected business segments include: laboratory diagnostics,
diabetes, medical optics and the proprietary pharmaceutical business
(proprietary pharmaceuticals sold in the U.S. and worldwide such as
cholesterol products and arthritis treatment Humira).
The company reported its plans for job reductions on the same day it
released a favorable third-quarter financial report.
The company reported strong third-quarter earnings of $1.94 billion,
or $1.21 per share, up from $303 million, or 19 cents per share from a
year ago.
The Wall Street Journal reported that the surge was a result of a very
favorable comparison with third-quarter 2011, which was weighed
down by a legal settlement. And it stated that revenue slipped in the
closing quarter as sales growth slowed for its top-selling drug
Humira, an anti-inflammatory treatment for rheumatoid arthritis.
http://medicarewhistleblowerrights.com/2012/10/abbott-fined-700-million-for-off-label-marketing/
Abbott Labs Fined $700M for Off

Label Marketing
Posted by MWR on Oct 12, 2012 in Medicaid Fraud, Medicare Fraud, Medicare
Whistleblower Attorney, Off-label drug marketing, Pharmaceutical Fraud | 0
comments
For off label marketing of the drug

Depakote, a federal district judge last week ordered Abbott Laboratories to
pay a $500 Million criminal fine, to forfeit $198.5 Million, and to pay $1.5
Million to the Virginia Medicaid Fraud Control Unit.
In May, Abbott Laboratories pled guilty to off-label marketing of Depakote
for dementia and schizophrenia, uses not approved by the FDA. It also
settled allegations that it marketed Depakote for psychiatric illnesses in
children, including conduct disorders, attention deficit disorder and autism,
and other psychiatric illnesses in adults, including depression, anxiety,
obsessive-compulsive disorder, post-traumatic stress disorder, alcohol and
drug withdrawal, agreeing to pay $1.6 Billion.
Whistleblowers get a share of these settlements as a reward for reporting
fraud under the False Claims Act.
Explains the LA Times:
Lawsuits filed by four groups of whistle-blowers alleged that Abbott
marketed the drug for off-label uses, including for treatment of
schizophrenia, dementia and autism. The Justice Department intervened in
those suits to determine whether the company’s marketing of the drug
violated civil and criminal laws, including fraudulently charging Medicare
and Medicaid.
Those lawsuits alleged that Abbott encouraged and trained its salespeople
to market Depakote off-label to nursing-home directors, geriatric doctors
and other long-term-care providers. The company also gave doctors illegal
kickbacks to talk about off-label uses of the drug to boost sales, according
to the whistle-blower suits, which were filed in federal courts in Illinois,
Virginia and the District of Columbia.
Although doctors are allowed to prescribe drugs for off-label uses, or uses
that have not been approved by the Food and Drug Administration, it is
illegal for drug companies to market them for such uses. When drug
companies engage in off label marketing, false claims are made to the
government, which purchases the drugs through Medicare and Medicaid
programs. Depakote has only been approved for certain types of seizures,
for manic episodes of bi-polar patients, and to prevent migraines.
“Abbott unlawfully targeted a vulnerable population, the elderly, through its
off-label promotion. The court’s sentence makes clear that those who
engage in such conduct will be prosecuted and held accountable,” said
Timothy Heaphy, U.S. Attorney for the Western District of Virginia.
- See more at: http://medicarewhistleblowerrights.com/2012/10/abbott-fined-
700-million-for-off-label-marketing/#sthash.Z4Mu4OGr.dpuf
http://www.justice.gov/opa/pr/2012/October/12-civ-1195.html
Tuesday, October 2, 2012
Abbott Laboratories Sentenced for Misbranding Drug
Judge Imposes $500 Million Fine and $198.5 Million Forfeiture for Illegal Marketing
Pharmaceutical manufacturer Abbott Laboratories Inc. was sentenced by U.S. District
Court Judge Samuel G. Wilson of the Western District of Virginia in connection with
its guilty plea related to its unlawful promotion of the prescription drug Depakote for
uses not approved as safe and effective by the Food and Drug Administration (FDA)
the Justice Department announced today. Abbott, which was ordered to pay a
criminal fine in the amount of $500 million, plus a forfeiture of $198.5 million, and
$1.5 million to the Virginia Medicaid Fraud Control Unit, will also be subject to a
five-year term of probation.
In May 2012, Abbott pleaded guilty to a criminal misdemeanor for misbranding

Depakote in violation of the Federal Food, Drug and Cosmetic Act
(FDCA). Abbott’s criminal plea related to the misbranding of Depakote by
promoting the drug to control behavioral disturbances in dementia patients and to treat
schizophrenia when neither of these uses was approved by the FDA. Under the
provisions of the FDCA, a company is required to specify the intended uses of a
product in its new drug application to FDA. Once approved, the drug may not be
marketed or promoted for “off-label” uses – unless the company applies to the FDA
for approval of the additional use. In an agreed statement of facts, Abbott admitted
that from January 1998 to December 2006 it marketed Depakote off-label to treat
behavioral disturbances in dementia patients, and from January 2002 to December
2006, Abbott marketed Depakote off-label to treat schizophrenia.
Under the terms of the plea agreement, Abbott agreed to pay the second-largest
criminal fine for a single drug, executed a fulsome statement of facts (with exhibits)
revealing the extent of its unlawful conduct, admitted that it engaged in misleading
statements, and submitted to a five-year term of probation. Under the terms of its
probation, on an annual basis, Abbott’s CEO and board of directors will need to
personally certify that the company is complying with the law.
Abbott’s guilty plea was part of a global resolution involving its illegal promotional
activity. Abbott also entered into a civil settlement agreement under which it agreed
to pay $800 million to the federal government and the states to resolve claims that its
unlawful marketing and illegal remuneration practices caused false claims to be
submitted to government healthcare programs. The parallel civil settlement covered
a broader range of conduct by Abbott. The settlement resolved allegations that in
addition to off-label marketing for dementia and schizophrenia, Abbott also marketed
Depakote for other psychiatric conditions in adults, including depression, anxiety,
obsessive-compulsive disorder, post-traumatic stress disorder, alcohol and drug
withdrawal and psychiatric conditions in children, including conduct disorders,
attention deficit disorder and autism.
In addition to the criminal and civil resolutions, Abbott also agreed to enter into an
expansive 5-year corporate integrity agreement with the Office of Inspector General
of the Department of Health and Human Services (HHS-OIG) that requires enhanced
accountability, increased transparency, and wide-ranging monitoring activities
conducted by both internal and independent external reviewers.
“Today’s sentencing confirms that the resolution we reached with Abbott in May is
the right result. And it emphasizes the importance of the U.S. government’s
coordinated efforts to combat health care fraud. We expect companies to make
honest, lawful claims about the drugs they sell, we will be vigorous in our
enforcement efforts when they break the law, and the courts will hold them
accountable.” said Stuart F. Delery, Acting Assistant Attorney General for the Justice
Department’s Civil Division.
“Abbott unlawfully targeted a vulnerable population, the elderly, through its off-label
promotion. The court’s sentence makes clear that those who engage in such conduct
will be prosecuted and held accountable,” said Timothy Heaphy, U.S. Attorney for the
Western District of Virginia.
This case was handled by the U.S. Attorney’s Office for the Western District of
Virginia and the Justice Department’s Civil Division. The investigation was
conducted by the Virginia Attorney General’s Medicaid Fraud Control Unit; the
Internal Revenue Service - Criminal Investigation; the FDA - Office of Criminal
Investigation; the Defense Criminal Investigative Service; the Health and Human
Services - Office of Inspector General; the West Virginia State Police; the Office of
Personnel Management - Office of Inspector General; the Department of Veterans’
Affairs Office of Inspector General; the Department of Labor - Office of Inspector
General; and TRICARE Program Integrity.
12-1195
Civil Division
http://www.iposgoode.ca/2011/01/rejection-of-abbott-laboratories-hiv-drug-patent-in-india/
Rejection of Abbott Laboratories’ HIV Drug Patent in

India
January 26, 2011 by Dan Whalen
Dan Whalen is a JD Candidate at Osgoode Hall Law School.
The Indian Patent Office recently denied exclusive rights to Abbott Laboratories for a premier
HIV-fighting drug – effectively opening up the market to lower-cost generic substitutes. The
company’s application was officially contested by four opponents led by the non-governmental
organization Initiative for Medicines, Access & Knowledge, a harsh critic of Abbott’s pricing
strategies. These opponents and many observers have called the decision a landmark victory in
the treatment of HIV and AIDS (e.g. one, two, and three).
Although Abbott’s pricing alone has led authorities in other jurisdictions to threaten the
company’s exclusive rights on the drug, price played no official role in this decision. Rather, the
Patent Office questioned the inventiveness of the process by which the drug is manufactured.
Specifically, it held that the process does not involve an inventive step and would be obvious to
a person skilled in the art through routine experimentation. At the same time, the Patent Office
conceded the novelty of specific characteristics of the drug itself. Certain features rendered the
drug capsule quite heat-stable and increased its oral bioavailability.
Abbott defends the inventiveness of both its drug and process. Unlike earlier iterations, the
heat-stable tablet does not require refrigeration nor must it be taken with food. The company
argues that these advances offer “significant benefit for patients in developing countries and
resource limited settings.” Perhaps more importantly, the company argues that the fact the
manufacturing process enables greater bioavailability of the drug’s component antiviral agents
over compounds made by similar methods constitutes a novel approach. Abbott is considering
its next move.
Abbott has been routinely criticized for its pricing of the drug, which it sells under the brand
names Kaletra and Aluvia. A 2006 WHO study found that although the company charged as little
as $550 per patient per year in some areas, it charged customers in developing countries like El
Salvador and Peru upwards of $4,500 per year. Such strategies may have resulted in a windfall
for Abbott; the drug generated $1.37 billion in sales in 2009, rendering it the company’s second-
best selling pharmaceutical product. Although Abbott has lowered the price in India to $1,000 per
patient per year, the drug is currently available for only $440 in Africa from Indian generic
suppliers under a program negotiated by the Clinton Health Access Initiative.
Abbott has made no official statements explaining its pricing strategy, though the realities of the
pharmaceutical industry may offer some explanation. Initial development and marketing costs
of drugs are prodigious and their manufacturers must initially charge higher prices to recoup
their expenses. In many parts of the world, Abbott continues to enjoy a monopoly on Kaletra and
thus has little incentive by way of competition to reduce its prices.
In light of these pricing controversies and subsequent lack of much-needed access, the Indian
Patent Office’s decision seems to satisfy many observers’ notions of social justice. As a matter
of law, however, it remains to be seen if the decision will stand.
- See more at: http://www.iposgoode.ca/2011/01/rejection-of-abbott-laboratories-
hiv-drug-patent-in-india/#sthash.CmXExofd.dpuf
http://www.ag.ny.gov/press-release/ag-schneiderman-announces-54-million-
settlements-pharmaceutical-giant-abbott
A.G. Schneiderman Announces $54 Million Settlements

With Pharmaceutical Giant Abbott Laboratories For
Deceptive Practices
$50 Million To Resolve Civil and Criminal Allegations That

Abbott Illegally Marketed "Depakote"
$4 Million To End Deceptive Advertising Practices & Off-Label

Promotion Of Anti-Seizure Drug
NEW YORK -- Attorney General Eric T. Schneiderman today announced two separate
settlements with Illinois-based pharmaceutical giant Abbott Laboratories regarding the
marketing and sale of the anti-seizure drug Depakote for unapproved uses. The first is a $1.5
billion global settlement with other states and the federal government to settle civil and
criminal allegations that Abbott Laboratories illegally marketed Depakote with New York's
share being $50 million. The second is a $100 million settlement reached by Attorney General
Schneiderman along with 44 other State Attorneys General and the District of Columbia arising
from alleged improper marketing and promotion of the anti-seizure drug Depakote. It is the
largest ever multi-state consumer protection-based pharmaceutical settlement. New York’s
share of the consumer-related settlement is nearly $4 million.
“New York consumers should not have to put their health put at risk as a result of the illegal
promotion of drugs for off-label uses by pharmaceutical companies," said Attorney General
Schneiderman. "Consumers should be able to rely on their doctor’s advice for prescriptions
without having to worry that their doctors have been manipulated by pharmaceutical
companies."
For the $1.5 billion settlement, the states contend that from January 1998 through December
2008, Abbott promoted the sale and use of Depakote for uses that were not approved by the
Food and Drug Administration as safe and effective. This alleged conduct resulted in false
claims to Medicaid and other federal healthcare programs. Further, the covered conduct from
the settlement provides that Abbott Laboratories made false and misleading statements about
the safety, efficacy, dosing and cost-effectiveness of Depakote for some unapproved uses;
improperly marketed the product in nursing homes; and paid illegal remuneration to health
care professions and long term care pharmacy providers to induce them to promote and/or
prescribe Depakote.
The $1.5 billion settlement is the second largest recovery from a pharmaceutical company in a
single civil and criminal global resolution. Abbott Laboratories will pay the states and the
federal government a total of $800 million in civil damages and penalties to compensate
Medicaid, Medicare, and various federal healthcare programs for harm suffered as a result of
its conduct. In addition to the civil settlement, Abbott Laboratories pled guilty this morning to
a violation of the Food, Drug, and Cosmetic Act (FDCA) and agreed to pay a criminal fine and
forfeiture of $700 million. Further as a condition of the settlement, Abbott Laboratories will
enter into a Corporate Integrity Agreement with the United States Department of Health and
Human Services, Office of the Inspector General.
This multi-state settlement is based on four qui tam cases that were consolidated and are
pending in the United States District Court for the Western District of Virginia in Abingdon,
Virginia. The cases were filed under Federal and State false claims statutes.
In the second settlement, Attorney General Schneiderman alleged that Abbott Laboratories
engaged in deceptive and misleading practices when it marketed Depakote for off-label uses. As
a result of the states' investigation, Abbott Laboratories agreed to change its marketing of
Depakote and to cease promoting “off-label” uses of the drug, which are not approved by the
U.S. Food and Drug Administration (FDA). Depakote is approved for treatment of seizure
disorders, mania associated with bipolar disorder and prophylaxis of migraines, but Attorney
General Schneiderman alleged that Abbott marketed the drug for treating unapproved uses,
including schizophrenia, agitated dementia and autism.
Under the settlements, Abbott Laboratories is:

• Prohibited from making false or misleading claims about Depakote;
• Prohibited from promoting Depakote for off-label uses; and,
• Required to ensure financial incentives on sales do not promote off-label uses of Depakote.
In addition, for a five-year period, Abbott must:

• Limit distribution of medical information provided in response to requests by physicians and
health care professionals, including information about off-label uses of Depakote, to ensure
that materials are presented in an unbiased, non-promotional and scientifically balanced
manner;
• Limit dissemination of reprints of clinical studies relating to off-label uses of Depakote;
• Limit use of grants and Continuing Medical Education (CME) to market Depakote;
• Disclose annually on its website Depakote-related CME grants to physicians in amounts over
$200; and
• Register and disclose clinical trials regarding Depakote.
A state team appointed by the National Association of Medicaid Fraud Control Units
participated in the investigation and conducted the settlement negotiations with Abbott on
behalf of the participating states. Team members include representatives from the Offices of
the Attorneys General for the states of California, Georgia, Illinois, Massachusetts, Maryland,
South Carolina, Ohio and Virginia.
The Attorney General’s Medicaid Fraud Control Unit led the state’s investigation and
represented the state’s interest in the resolution, led by Special Assistant Attorney General
Sherrie Brown and Elizabeth Silverman, Carolyn Pollard, Deputy Director of the Electronic
Investigative Support Group, Supervising Special Auditor Investigator Stacey Millis, and
Medical Analyst Stephanie Keyser. This portion of the investigation was conducted under the
supervision of Assistant Deputy Attorney General Paul Mahoney and Special Deputy Attorney
General Monica Hickey-Martin.
The consumer case was handled by Assistant Attorney General Benjamin J. Lee under the
supervision of Laura J. Levine, Deputy Bureau Chief, and Jane M. Azia, Bureau Chief of the
Consumer Frauds and Protection Bureau and Executive Deputy Attorney General for Economic
Justice Karla G. Sanchez.
http://www.pharmcast.com/WarningLetters/CompanyWL1000.htm
http://www.lieffcabraser.com/Case-Center/Abbott-Laboratories-Norvir-Monopolization-Pricing-
Lawsuit.shtml
Case Center
TEXT SIZE:
 A
 A
 A
Abbott Laboratories Norvir Monopolization Pricing

Lawsuit
 Result: $52 million settlement
Year: 2011
Lieff Cabraser served as co-counsel for a group of retailers charging that Abbott
Laboratories monopolized the market for AIDS medicines used in conjunction with Abbott’s
prescription drug Norvir. These drugs, known as Protease Inhibitors, have enabled patients
with HIV to fight off the disease and live longer.
In January 2011, the Court denied Abbott's motion for summary judgment on plaintiffs'
monopolization claim. Trial commenced in February 2011. After opening statements and
the presentation of four witnesses and evidence to the jury, plaintiffs and Abbott
Laboratories entered into a $52 million settlement. The Court granted final approval to the
settlement in August 2011.
http://www.twincities.com/ci_21836587/minnesota-get-4-5-million-from-abbott-laboratories
Minnesota to get $4.5M from

Abbott Lab settlement
By Christopher Snowbeck
csnowbeck@pioneerpress.com
POSTED: 10/23/2012 12:01:00 AM CDT | UPDATED: ABOUT A YEAR AGO
The state of Minnesota will receive about $4.5 million from Illinois-based Abbott
Laboratories as part of a national health care fraud settlement, the Minnesota
Department of Human Services announced Tuesday, Oct. 23.
The settlement calls on Abbott to pay $9 million related to the use of a drug called
Depakote by patients in the state's public health insurance programs, including
Medicaid.
The sum will be split between the state and federal government, which jointly
fund Medicaid.
In May, Abbott Laboratories pleaded guilty to illegally marketing Depakote to

control agitation and aggression in elderly dementia patients and to treat
schizophrenia. The U.S. Food and Drug Administration did not approve either
use of the drug, which is approved for epileptic seizures, bipolar mania and the
prevention of migraines.
Federal law stipulates that a drug company can only promote a medication for
uses approved by FDA. Promotion of other such uses -- known as "off-label" --
render the product misbranded.
"Abbott pled guilty to maintaining a specialized sales force to market Depakote

for off-label purposes, targeting elderly dementia patients in nursing homes," the
state Department of Human Services said in a statement Tuesday.
As part of the guilty plea in May, Abbott agreed to pay $1.5 billion to resolve
criminal and civil investigations. The sum included $239 million for states that
opted to participate in the agreement, which resolves claims that Abbott's
unlawful marketing caused false claims to be submitted to government health
insurance programs.
http://www.sokolovelaw.com/blog/humira-lawsuit-filed-against-abbott-laboratories
Humira Lawsuit Filed Against Abbott Laboratories
Feb 22 2012
Dangerous Drugs
Share this:
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A woman has filed a dangerous drug lawsuit against Abbott Laboratories inc. claiming the
company’s Humira drug led to her cancer diagnosis.
According to Law360 (subscription required), Cynthia DiBartolo alleges that she was
prescribed Humira to treat a psoriasis flare-up in late 2008. She received injections until April 2009
when her dentist noticed an irregular mass on her tongue. She was soon diagnosed with squamous
cell carcinoma and had to undergo surgery to remove part of her tongue, according to the complaint.
DiBartolo claims that since the cancer diagnosis she has since suffered weakness, difficulty speaking
and seizure like symptoms, among other conditions. She also alleges that Abbott knew about Humira’s
association with skin cancers from clinical trials, but failed to warn consumers and health care providers
about tracking the drug for signs of skin cancer until March 2011.
She is seeking punitive and compensatory damages.
If you or a loved one has been harmed by a dangerous drug, contact Sokolove Law for a free legal
consultation and to find out if you have grounds to pursue legal action.
Cited From: Humira Lawsuit Filed Against Abbott

Laboratories http://www.sokolovelaw.com/blog/humira-lawsuit-filed-against-abbott-
laboratories#ixzz2z7iWiI9X
Related Media Article
http://seekingalpha.com/article/1107361-humira-will-help-abbvie-prevail-a-great-buy-with-low-
valuation
http://capitolwords.org/date/2000/10/31/E2037-4_abbott-laboratories-overcharges-taxpayers-and-
jeop/
Abbott Laboratories Overcharges Taxpayers And Jeopardizes
Public Health
volume 146 , number 141

pages e2037-e2039
extensions of remarks
tue, oct. 31, 2000
Rep. Pete Stark
D
CA
Mr. Speaker, I am today submitting for the Record a letter I sent to Mr. Miles White, Chief
Executive Officer of Abbott Laboratories. Recent congressional investigations have collected
evidence that Abbott has reported inflated prices and has engaged in other improper business
practices in order to create windfall profits for providers submitting Medicare and Medicaid
claims for certain Abbott drugs.
Such drug company behavior overcharges taxpayers and jeopardizes the public health system.
The letter follows:
Dear Mr. White: You should by now be aware of Congressional investigations revealing that
Abbott has for many years reported and published inflated and misleading price data and has
engaged in other deceptive business practices. This letter is a call for your company to
immediately cease overcharging taxpayers and jeopardizing the public health. The price
manipulation scheme is executed through Abbott's inflated representations of average
wholesale price (`ÀWP'') and direct price (``DP'') which are utilized by the Medicare and
Medicaid programs in establishing drug reimbursements to providers. The difference between
the inflated representations of AWP and DP versus the true price providers are paying, is
regularly referred to in your industry as ``the spread.'' The evidence amassed by Congress
clearly shows that Abbott has intentionally reported inflated prices and has engaged in other
improper business practices in order to cause its customers to receive windfall profits from
Medicare and Medicaid when submitting claims for certain drugs. The evidence further
reveals that Abbott manipulated prices for the express purpose of expanding sales and
increasing market share of certain drugs. This was achieved by arranging financial benefits or
inducements that influenced the decisions of health care providers submitting Medicare and
Medicaid claims. Contrary to Abbott's recent assertions in the national media, the price
manipulation conduct was in no way required by or consistent with existing reimbursement
laws or policies. Indeed, Abbott did not falsify published prices in connection with other
drugs, where sales and market penetration strategies did not include arranging financial
``kickbacks'' to health care providers. In the case of the drugs for which Abbott sought to
arrange a financial kickback at the expense of government programs, the manipulated
discrepancies between your company's reported AWPs and DPs versus their true costs are
staggering. For example, in the 2000 edition of the Red Book, Abbott reported an AWP of
$2,094.75 and a DP of $1,764.00 for a package of Acyclovir Sodium 1 gm. 10's Acyclovir
Sodium is an important drug in the treatment of AIDS related illnesses and it is essential that
government health programs be able to accurately estimate its acquisition cost in setting
reimbursements. Even more devastating, Abbott has intentionally caused the government to
pay inflated amounts for this important drug at a time when AIDS health benefits were being
limited due to budgetary constraints. Another example of Abbott's drug price manipulation
concerns the IV antibiotic Vancomycin, the drug of last resort in combating many life
threatening infections. The public health crisis associated with the overutilization of
Vancomycin is now of immediate concern. Exhibit #2, article from Hospital Pharmacist
Report entitled Under Attack Vancomycin-Resistant S. Aureus Hits U.S. Shores, states:
Indeed, as stated in the article, the problem has reached the level where the CDC has called
for strict limits on the use of this vital drug. In recent press reports, Abbott attempts to avoid
responsibility for financially inducing health care providers to administer Vancomycin. Abbott
has suggested that the drug's usage in the outpatient setting is minimal. The evidence
developed by the Congressional investigators, however, reveals that outpatient utilization of
Abbott Vancomycin has grown substantially in recent years as Abbott inflated its price reports
to drug price publishers, while the true price to health care providers fell. Enclosed as
Composite Exhibit #3 are excerpts from the Red Book showing Abbott's false price reports for
Vancomycin in 1995, 1996 and 1999, together with advertisements available to industry
insiders reflecting the lower actual prices. The following chart summarizes this information:
The evidence uncovered shows that providers will purchase and utilize pharmaceutical
manufacturers' products that have the widest spread between the providers' true costs and the
reimbursement paid by third parties--including State Medicaid Programs and Medicare. In
1996, Abbott, Fujisawa, Lederle, Lilly and Schein all made representations of Wholesaler
Acquisition Cost (``WAC'') to the State of Florida, as summarized in the chart below (Exhibit
``4''). The chart sets out the reimbursement amount paid by Florida Medicaid, the industry
insider's true cost and ``the spread'' between Medicaid reimbursement and true cost. A
review of the chart below clearly demonstrates that the vast majority of providers utilize
Abbott's Vancomycin, the drug with the greatest spread between the true wholesaler
acquisition cost and the inflated false WAC reported by Abbott. Exhibit ``5'', prepared by the
National Association of Medicaid Fraud Controls Units in conjunction with their ongoing
investigation, further demonstrates that Abbott maximized sales volume and The following
document (Exhibit ``6'') reflects misleading price representations that Abbott sent to Medi
Span (now acquired by First Data Bank) concerning two package sizes of Vancomycin. Medi
Span's data acquisition specialist attempted to clarify with ``Jerrie,'' from Abbott, the pricing
discrepancies and confusion over the prices of the two packages: Abbott's apparent price
manipulation created a financial incentive for doctors to increase their usage of Vancomycin,
at the very time that overutilization of the drug created a health crisis. This is an especially
reprehensible misuse of Abbott's position as a drug manufacturer. Additionally, as indicated
by the evidence below, Abbott has provided or arranged for a number of other financial
inducements to stimulate sales of its drugs at the expense of the Medicaid and Medicare
Programs. Such inducements include volume discounts, rebates, off invoice pricing, and free
goods, and are designed to result in a lower net cost to the purchaser, while concealing the
actual cost. For example, a product invoiced at $100 for ten units of a drug item would in
reality only cost the purchaser half that amount if a subsequent shipment of an additional ten
units is provided at no charge. The same net result can be achieved through a ``grant,''
``rebate,'' or ``credit memo'' in the amount of $50. The following excerpts from Abbott's
internal documents (Composite Exhibit ``7'') are examples of Abbott's creation of off invoice
price reductions that conceal the true price of drugs and impede the Medicare and Medicaid
Programs from accurately estimating the acquisition cost of drugs: As I am sure you are
aware, the inflation index for prescription drugs continues to rise at a rate of more than twice
that of the consumer price index. The American taxpayers, Congress and the press are being
told that these increases are justified by the cost of developing new pharmaceutical products.
Abbott and certain other manufacturers are clearly exploiting the upward spiral in drug prices
by falsely reporting that prices for some drugs are rising when they are in fact falling. For
example, the actual price being paid by industry insiders for Abbott's drug, Sodium Chloride
0.9 percent, was in many years less than half of what Abbott represented. Abbott falsely
reported that the average wholesale price to health care providers for Sodium Chloride 0.9
percent, 500 ml 24s, [NDC # 00074-7983- 03], rose from $206.06 to $229.43 during the
years 1993 through 1996. The Congressional investigations have revealed that, in fact, the true
price to industry insiders from Florida Infusion was only $43.20 in 1993 and the price actually
fell to $36.00 by 1996. (Composite exhibit 8). Abbott's knowledge that true wholesale prices
were falling for many of its drugs at the very time that it falsely reported that its prices were
rising is evidenced by an internal Abbott document (Exhibit ``9'') dated March 10, 1994 to a
wholesaler, Florida Infusion, which states the following: ``The first three pages, identified as
Florida Infusion Price Changes indicate the products in which prices were changed and their
new contract price. Favorable factory cost in 1994 have lead the way for these price
reductions! (emphasis added). Shortly after informing Florida Infusion that its prices were
being reduced, Abbott falsely informed Red Book that its prices were being increased, as
evidenced by the internal memo dated May 26, 1994 (Exhibit ``10''): `Às you are aware, on
at [sic] the beginning of April, Abbott took a list price increase. This also has an effect on our
AWP (Average Wholesale Price) which Red Book quotes for reimbursement purposes.'' Abbott
created and marketed these financial inducements for the express purpose of influencing the
professional judgment of doctors and other health care providers. Abbott's strategy of using
taxpayer funds to increase company drug sales and enriching doctors and others who
administer the drugs is reprehensible and a blatant abuse of the privileges that Abbott enjoys
as a major pharmaceutical manufacturer in the United States. Doctors should be free to
choose drugs based on what is medically best for their patient. Inflated price reports should
not be used to financially induce doctors to administer Abbott's drugs. Abbott's conduct, in
conjunction with other drug companies, has cost the taxpayers billions of dollars and serves as
a corrupting influence on the exercise of independent medical judgement both in the
treatment of severely ill patients and in the medical evaluation of new drugs. Accordingly, I
have requested that the Commissioner of the United States Food and Drug Administration,
Dr. Jane Henney, conduct a full investigation into the business practices of certain drug
companies, including Abbott. My reading of the Federal Food, Drug, and Cosmetic Act and
the corresponding regulations suggests that the FDA should pay particular attention to
Abbott's misleading price reports and take affirmative action to ensure that its
representations about its drugs are accurate and not misleading. Abbott is clearly capable of
representing prices that do not include a kickback for many of its drugs. The following chart
(`Èxhibit II'') specifies drugs for which Abbott reported accurate prices: As illustrated by the
preceding information, Abbott clearly has the ability to accurately and competently report its
prices and consistently did so when it was in its own economic interest. I urge Abbott to
immediately cease reporting inflated and misleading price data. Such action places the
nation's health care at great risk and overcharges taxpayers. Based on the evidence collected,
Abbott should make arrangements to compensate taxpayers for the financial injury caused to
federally funded programs. Any refusal to accept responsibility will most certainly be
indicative of the need for Congress to control drug prices. If we cannot rely upon drug
companies to make honest and truthful representations about their prices, then Congress will
be left with no alternative but to take decisive action to protect the public. I would appreciate
your sharing this letter with your Board of Directors and in particular with the Board's
Corporate Integrity Committee. Sincerely, Pete Stark, Member of Congress.
http://www.thebody.com/content/art10898.html
Hundreds of Doctors Call for Boycott of Abbott

Laboratories Following 400% Price Increase of
AIDS Drug
From Henry J. Kaiser Family Foundation
February 11, 2004
A group of about 200 doctors who treat HIV/AIDS patients has called for a boycott of
Chicago-basedAbbott Laboratories after the company's recent price increase for the
antiretroviral drug Norvir,Reuters/Los Angeles Times reports (Reuters/Los Angeles
Times, 2/11). Attorneys general for Illinois and New York have begun investigations into
whether Abbott violated antitrust laws when it increased by 400% the price of Norvir. In
December 2003, Abbott increased the wholesale price of Norvir -- which is known
generically as ritonavir -- from $54 per month to $265 per month. Norvir is primarily used
as a booster for other protease inhibitors, such as Bristol-Myers Squibb's Reyataz
and Merck's Crixivan. On Feb. 6, Illinois Attorney General Lisa Madigan (D) announced
that her office had opened an investigation into whether the price increase of Norvir was
designed to increase the price of antiretroviral drug combinations that use Norvir as a
booster and steer patients toward Abbott's newer antiretroviral drug Kaletra. Kaletra,
which does not need a booster for other protease inhibitors because it includes Norvir,
costs about $18.78 per day, or $563.40 per month, and has a longer patent life (Kaiser
Daily HIV/AIDS Report, 2/9). The doctors on Tuesday at the 11th Conference on
Retroviruses and Opportunistic Infections in San Francisco agreed that until Abbott
reduces the price of Norvir, they will resign from all Abbott advisory boards and lecture
faculties, prohibit all Abbott representatives from visiting their offices and not participate in
any future Abbott-sponsored clinical trials, according to the Chicago Sun-Times. In
addition, the doctors will consider non-Abbott drug treatment alternatives for their patients
unless an Abbott drug would be in the patient's best interest. They plan to extend the
boycott to other Abbott products and encourage other physicians to join the boycott,
the Sun-Times reports.
Reaction
Dr. Benjamin Young, an HIV/AIDS specialist at Rose Medical Center in Denver who joined
the boycott, asked Abbott to rescind the Norvir price increase, saying that a 400% price
increase for an approved and "long-used" drug is "unethical" (Knowles, Chicago Sun-
Times, 2/11). The French AIDS treatment collective TRT-5 said in a statement, "By
artificially giving Kaletra an overwhelming competitive advantage, Abbott is also effectively
killing the commercial incentive for its more creative competitors to come up with the safer
and more efficacious [protease inhibitors] that so many patients are in desperate need of"
(TRT-5 release, 2/10). Abbott has said that the Norvir price increase was "long overdue,"
according to Reuters. Abbott spokesperson Laureen Cassidy said that Norvir is "still the
lowest price[ed]" HIV/AIDS drug in its class (Richwine/Dixon, Reuters, 2/10). Dr. John
Leonard, vice president of global pharmaceutical development at Abbott, said that the
price increase will allow Abbott to develop new HIV/AIDS treatments, according to
the Sun-Times. Leonard added that Abbott has frozen Norvir's price for state AIDS Drug
Assistance Programs and makes the drug available at no charge to patients who do not
have health insurance (Chicago Sun-Times, 2/11). According to Cassidy, the physicians
participating in the boycott represent only a minority of physicians treating HIV/AIDS
patients, Reuters reports.
AHF Lawsuit
In related news, the AIDS Healthcare Foundation on Tuesday announced that it is filing an
antitrust lawsuit against Abbott for the price increase, according to Reuters (Reuters,
2/10). "Abbott's 400% increase for Norvir, from a cost of roughly $50 per month to nearly
$250 per month, is purely and simply a move to wield its patent and monopoly power in
the AIDS drug market and increase Abbott's own profits on this key AIDS drug," AHF
President Michael Weinstein said. He added, "Abbott's claims of 'research and development
costs' and the need to cover development of newer reformulations of the drug ring hollow
as Norvir ... was developed with the help of substantial government underwriting and
grants -- a taxpayer investment which will now sadly benefit the corporate coffers of
Abbott at the expense -- literally -- of the lives of millions of people living with HIV/AIDS"
(AHF release, 2/10). Cassidy said that the lawsuit is "completely without merit" and
"jeopardizes the long-term interests of AIDS patients" (Reuters/Los Angeles Times, 2/11).
Back to other news for February 11, 2004
http://www.wkrb13.com/markets/256078/insider-selling-abbott-laboratories-evp-sells-11430-
shares-of-stock-abt/
Insider Selling: Abbott Laboratories EVP Sells 11,430 Shares of

Stock (ABT)
Posted by Zach Kirkland on Feb 3rd, 2014 // No Comments
Abbott Laboratories (NYSE:ABT) EVP

Michael Warmuth sold 11,430 shares of the company’s stock in a transaction that
occurred on Wednesday, January 29th. The stock was sold at an average price
of $36.21, for a total transaction of $413,880.30. Following the completion of the
sale, the executive vice president now directly owns 40,487 shares in the
company, valued at approximately $1,466,034. The transaction was disclosed in
a legal filing with the Securities & Exchange Commission, which is available
at this link.
ABT has been the subject of a number of recent research reports. Analysts at
Zacks reiterated a “neutral” rating on shares of Abbott Laboratories in a research
note to investors on Thursday, January 23rd. They now have a $40.00 price
target on the stock. Separately, analysts at Leerink Swann raised their price
target on shares of Abbott Laboratories from $37.00 to $40.00 in a research note
to investors on Thursday, January 23rd. Finally, analysts at Cowen and Company
raised their price target on shares of Abbott Laboratories from $41.00 to $45.00
in a research note to investors on Friday, January 17th. One investment analyst
has rated the stock with a sell rating, seven have assigned a hold rating and eight
have issued a buy rating to the company. Abbott Laboratories presently has an
average rating of “Hold” and an average target price of $39.64.
Abbott Laboratories (NYSE:ABT) opened at 36.66 on Monday. Abbott
Laboratories has a 52-week low of $32.70 and a 52-week high of $39.86. The
stock has a 50-day moving average of $38.07 and a 200-day moving average of
$36.38. The company has a market cap of $56.683 billion and a P/E ratio of
22.59.
Abbott Laboratories (NYSE:ABT) last posted its quarterly earnings results on
Wednesday, January 22nd. The company reported $0.58 EPS for the
quarter, meeting the Thomson Reuters consensus estimate of $0.58. The
company had revenue of $5.66 billion for the quarter, compared to the consensus
estimate of $5.72 billion. During the same quarter in the prior year, the company
posted $1.51 earnings per share. The company’s quarterly revenue was up .4%
on a year-over-year basis. On average, analysts predict that Abbott Laboratories
will post $2.20 earnings per share for the current fiscal year.
Abbott Laboratories (NYSE:ABT), is engaged in the discovery, development,
manufacture, and sale of a portfolio of science-based health care products.
http://www.marketwatch.com/story/abbott-lab-insider-bought-300000-of-the-stock-2013-02-06
Feb. 6, 2013, 12:14 p.m. EST
Aboott Laboratories insider bought $300,000 of the

stock
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By Meena Krishnamsetty and Matt Doiron
A member of Abbott Laboratories’ ABT +1.08% board of directors, William Osborn, recently
bought 10,000 shares of stock at prices between $33.80 and $33.90. He now owns a little over
34,000 shares of the stock, so this is a significant purchase in percentage terms. Studies show
that insider purchases are bullish signs (see our analysis of studies on insider trading) . We
think this is because an insider must be confident enough in the company's prospects to
ignore the benefits of diversification before buying the stock.
Abbott Laboratories is a $53 billion market provider of pharmaceuticals (including generics),
diagnostic systems, and medical devices. Last quarter it experienced a 4% increase in revenue
compared with the fourth quarter of 2011. With operating expenses up only slightly- thanks in part
to a small reduction in R&D- operating income grew 16% from its levels a year earlier. While
earnings were down, this was due to a large loss on extinguishment of debt that we think we can
assume is in the best interests of Abbott Labs as well as nonrecurring.
The stock trades at 9 times trailing earnings, though judging from analyst expectations it appears
that is based on abnormally high net income in 2012. Consensus is for $2.02 in EPS this year,
implying a current-year P/E of 17. We would say that from a value perspective that would be a
decent multiple assuming moderate earnings growth over the next several years, and so we could
see a value investor doing further research on the stock. While many pharmaceutical companies
are thought of as income stocks, Abbott Laboratories isn't quite optimal there: the beta is indeed
fairly low at 0.5, but the dividend yield is less than 2%.
Billionaire Israel Englander's Millennium Management increased its stake in Abbott Labs during
the third quarter to a total of about 940,000 shares (find Englander's favorite stocks) . Citadel
Investment Group, which is managed by billionaire Ken Griffin, reported a position of 1.6 million
shares on its own 13F (check out Griffin's stock picks) . Orbimed Advisors, a health care
focused fund run by Samuel Isaly and his team, was also buying the stock and closed September
with 2.5 million shares in its portfolio (research more stocks that Orbimed was buying) .
Abbott's peers include Johnson & Johnson JNJ -0.45% , Merck MRK +0.37% , Bristol-Myers
Squibb BMY +1.95% , and Teva Pharmaceutical Industries TEVA +1.16% . There is a very wide
spread of forward earnings multiples in this peer group. Teva appears the cheapest from that
perspective, with the current pricing and analyst expectations actually giving it a five-year PEG
ratio slightly less than 1, but Johnson & Johnson and Merck have forward P/Es in the 11-13 range
and those are considerably larger companies. However, in each of these cases the sell-side's
expectations are generally for very strong earnings growth and so we would be careful of taking
the attractive earnings multiples at face value. In terms of dividends, Merck and Bristol-Myers
Squibb stand out for yields of roughly 4%; betas are also low, and Bristol-Myers Squibb in
particular has almost no correlation with broader market indexes at a beta of 0.1. Of course as
might be expected for pharmaceutical companies exposure to the overall economy is limited in all
cases.
It is fairly easy to evaluate Abbott Labs from an income perspective: ignore it and instead focus on
higher-yielding pharmaceutical companies such as Merck and Bristol-Myers Squibb. In terms of
value we do think that the stock has some positive aspects, as revenue and operating income have
been up and the P/E multiples look good. It certainly seems that it might be competitive with peers
such as Teva, Johnson & Johnson, and Merck though those companies have high expected
earnings growth that might make them worth looking into.
http://www.bloomberg.com/news/2011-08-24/strauss-kahn-insider-trading-abbott-temple-inland-
in-court-news.html
Strauss-Kahn,
Insider Trading,
Abbott Labs in
Court News
By Ellen Rosen Aug 24, 2011 5:07 PM GMT+0530
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122.0023.0024.0025.0026.00* Price chart for ABBOTT LABORATORIES. Click flags for
important stories.ABT:US24.4508/24/11
Former International Monetary Fund chief Dominique Strauss-Kahn’s sexual-
assault case was thrown out by a Manhattan judge after his accuser was found
to have lied about events surrounding the alleged attack.
New York State Supreme Court Justice Michael Obus yesterday granted
District Attorney Cyrus Vance Jr.’s request to dismiss the indictment. Obus
earlier rejected the accuser’s bid for a special prosecutor in the case and an
appeals court yesterday refused to reverse that decision.
The dismissal came about three months after Strauss-Kahn, once a potential
French presidential candidate, was pulled off a flight at John F. Kennedy
International Airport on May 14 and arrested for allegedly attempting to rape a
hotel maid.
The experience has been “a nightmare for me and my family,” Strauss-Kahn,

62, said in a statement after Obus ruled. “We are obviously gratified that the
district attorney agreed with my lawyers that this case had to be dismissed. We
appreciate his professionalism and that of the people who were involved in that
decision.”
The accuser, Nafissatou Diallo, told police that Strauss- Kahn attacked her
when she went to clean his suite at the Sofitel in midtown Manhattan. During
an investigation, Diallo, 33, admitted to lying about the circumstances of the
incident and other matters. Prosecutors said those lies made it impossible to
pursue the case. Kenneth Thompson, a lawyer for Diallo, accused Vance
yesterday of abandoning his client.
Obus didn’t say when Strauss-Kahn will be able to return to France, where
investigators are probing allegations that he tried to rape French writer Tristane
Banon eight years ago, a claim he has denied. He will also have to defend a
civil suit Diallo filed in New York state court seeking unspecified damages.
The criminal case is People v. Strauss-Kahn, 11-02526, New York State

Supreme Court (New York County); the civil case is Diallo v. Strauss-Kahn,
11-307065, New York State Supreme Court (Bronx County).
For more, click here.
Lawsuit News
Primary Global CEO ‘Co-Conspirator’ in Scheme, U.S. Alleges
Unni Narayanan, the chief executive officer of Primary Global Research LLC,
an expert networking firm, was a “co- conspirator” in an insider-trading
scheme, prosecutors claimed in court papers.
The government’s allegation was made public yesterday in a filing by a defense

attorney for James Fleishman, a former Primary Global sales manager facing
an Aug. 29 insider-trading trial in Manhattan federal court. The defense
lawyer, Ethan Balogh, attached a July 15 letter from prosecutors that listed the
“identity of co-conspirators” as Narayanan, Chief Operating Officer Phani
Saripella and other Primary Global employees.
The government identified the individuals in response to a defense request for

the names of people allegedly involved in the insider scheme.
Primary Global, based in Mountain View, California, is at the center of a
nationwide probe of insider trading at hedge funds, technology companies,
banks and consulting firms.
The firm connects investors with employees of public companies who

purportedly provide them with insight into specific markets.
Winifred Jiau, a consultant for Primary Global, was convicted of leaking

insider information in June.
Neither Narayanan nor Saripella has been criminally charged with wrongdoing.
Dan Charnas, a spokesman for Primary Global, declined to comment. Reached
at his home in California, Narayanan also declined to comment, as did Ellen
Davis, a spokeswoman for U.S. Attorney Preet Bharara in New York.
Prosecutors say Fleishman, of Santa Clara, California, helped pass leaks from
Primary Global’s consultants to the firm’s clients.
The defense filing by Balogh also includes an Aug. 15 letter from prosecutors
that names four other Primary Global consultants as co-conspirators who
allegedly leaked inside information about sales numbers, shipment forecasts
and profit margins.
They are employees of STMicroelectronics NV (STM), AT&T Wireless,

Samsung Semiconductor Inc. and Broadcom Corp. (BRCM) None of the
individuals has been criminally charged.
A call to Geneva-based STMicroelectronics wasn’t answered. Mark Siegel, an

AT&T spokesman, John Lucas, a spokesman for Samsung Semiconductor, and
Karen Kahn, a spokeswoman for Broadcom, declined to comment.
The case is U.S. v. Fleishman, 11-cr-32, U.S. District Court, Southern District
of New York (Manhattan).
For the latest lawsuits news, click here.
New Suits
Abbott Sued by MedImmune Over Respiratory Drug Distribution

MedImmune LLC sued an Abbott Laboratories unit in a dispute over the
distribution of drugs created to combat respiratory tract infections.
MedImmune, a unit AstraZeneca Plc (AZN), accused Abbott International LLC

of reneging on an agreement to seek European market approval for distribution
of MedImmune’s developmental drug, Numax, and of trying to parlay a U.S.
Food and Drug Administration request for additional testing of that medicine
into grounds for reducing the price Abbott paid for exclusive rights to distribute
an FDA-approved forerunner, Synagis, outside the U.S.
In a complaint filed in federal court in Greenbelt, Maryland, on Aug. 21,

MedImmune asked for findings that it is under no obligation to discontinue
development of Numax, and that the event that would have triggered a
reduction in the price Abbott must pay for distributing Synagis hasn’t
happened.
“We disagree with MedImmune’s interpretation of the contract and are

working to resolve the matter, Adelle Infante, a spokeswoman for Abbott Park,
Illinois-based Abbott Laboratories (ABT), said in an e-mailed statement.
AstraZeneca is based in London. Its MedImmune unit is based in Gaithersburg,

Maryland.
The case is MedImmune LLC v. Abbott International LLC 11cv2329, U.S.

District Court, District of Maryland (Greenbelt).
Temple-Inland Drops as Guaranty’s Trustee Sues for $1 Billion
Temple-Inland Inc., the cardboard maker fighting a $3.31 billion takeover bid
from International Paper Co. (IP), fell $3.49, or 14.06 percent, to $21.33 at 4:02
p.m. in New York Stock Exchange composite trading, the biggest decline since
March 2009.
The lawsuit claims that Temple-Inland, which spun off Guaranty Financial
Group Inc. (GFGFQ) in 2007, and the former subsidary’s directors and
officials caused its failure ‘‘by fraudulently looting” assets exceeding $1
billion. The suit was filed in federal court in Dallas Aug. 22 by Kenneth L.
Tepper, the liquidation trustee for Guaranty Financial.
“We do not believe that we have any liability related to the spinoff of Guaranty
Financial Group,” Temple-Inland, based in Austin Texas, said in a regulatory
filing yesterday. “The company believes that the claims made in this lawsuit
are without merit and intends to defend them vigorously.”
The lawsuit claims Guarantee Bank was operated as “a captive finance arm of
Temple-Inland’s manufacturing operation” and made risky loans to Temple-
Inland customers to sell building products.
The lawsuit also claims that Temple-Inland spun off Guaranty Financial Group
after stripping its assets, to avoid “a disastrous cross-default on Temple-
Inland’s own debt obligations.” This left Guaranty Financial Group, the Federal
Deposit Insurance Corp. and U.S. taxpayers to “suffer the enormous losses
defendants created,” according to the lawsuit.
The suit comes after International Paper, the world’s largest paper maker, this
month extended its $30.60-a-share offer to acquire Temple-Inland to Sept. 8.
Temple-Inland rejected the offer, saying on July 18 it “grossly” undervalues the
company.
The lawsuit is Tepper v. Temple-Inland Inc. (TIN), 3:11-cv-02088, U.S.

District Court, Northern District of Texas (Dallas).
HP Accuses AU Optronics of Display Panel Price Fixing in Lawsuit
Hewlett-Packard Co. has accused AU Optronics Corp. (AUO) of conspiring to

fix prices of thin-film transistor liquid crystal display panels in a complaint
filed Aug. 19 in federal court in San Francisco. The lawsuit was filed under
seal because of the confidential information about the company’s process for
procuring LCD panels.
The lawsuit relates to a pending case filed by purchasers of the screens, used in
personal computers, televisions and mobile devices, against LCD makers.
Yawen Hsiao, a spokeswoman for AUO, wasn’t immediately aware of the

complaint when contacted by phone yesterday. She declined to comment
further.
AUO, Taiwan’s second-largest maker of LCDs, and six of its executives were
indicted last year for allegedly conspiring to fix prices of flat-panel screens sold
worldwide, the Justice Department said in June 2010. The conspiracy ran from
2001 to 2006, the agency said. Apple Inc. (AAPL), Dell Inc. (DELL) and HP
were among the companies directly affected by the alleged scheme, the agency
said.
AUO, based in Hsinchu, Taiwan, said at the time “the facts of the case do not
warrant such charges.”
The case is Hewlett-Packard Co. (HPQ) v. AU Optronics Corp. (2409), 11-

4116, U.S. District Court, Northern District of California (San Francisco).
Trials/Appeals
Ex-Credit Suisse Broker Butler Is Resentenced to Five Years
Former Credit Suisse Group AG (CSGN) broker Eric Butler, convicted by a

jury of securities fraud in 2009, won’t have his prison sentence extended after
pleading guilty to seven wire-fraud counts stemming from the same actions.
Butler, 39, was resentenced to five years in prison yesterday by U.S. District
Judge Jack B. Weinstein in Brooklyn, New York, and ordered to surrender
Sept. 9 at the federal prison in Fort Dix, New Jersey. In January 2010, the
judge imposed the same penalty for Butler’s jury convictions for securities
fraud, conspiracy to commit securities fraud and conspiracy to commit wire
fraud.
“I regret my actions,” Butler told Weinstein before he was sentenced.
Butler and his partner, Julian Tzolov, were convicted in 2009 of intentionally
misleading clients about securities purchased on their behalf.
The federal appeals court in Manhattan in June overturned Butler’s securities-

fraud conviction, saying it should have been tried in federal court in Manhattan
rather than in Brooklyn. It upheld his two conspiracy convictions. Butler then
successfully got the wire-fraud counts moved to Brooklyn and consented to
having the securities-fraud count there as well. He also pleaded guilty to the
securities-fraud count.
The case is U.S. v. Tzolov, 08-cr-370, U.S. District Court, Eastern District of
New York (Brooklyn).
http://thyroid.about.com/library/weekly/aa061201a.htm
Abbott Laboratories Sues Unithroid Distributor

Watson Pharmaceuticals
Synthroid's Manufacturer Denies Safety and Effectiveness Problems and
Accuses Competitor of Disseminating Misinformation
by Mary J. Shomon
In the latest volley in the ongoing contest over the U.S. Food and Drug
Administration (FDA) approval process for the synthetic thyroid hormone
levothyroxine, Abbott Laboratories, manufacturer of Synthroid, filed suit on June
12, 2001 against Watson Pharmaceuticals, distributor of Unithroid. Abbott has yet
to file for or receive FDA approval for Synthroid; Watson's Unithroid product was
approved by the FDA in August of 2000.
Synthroid is the third most prescribed medicine in the U.S. Attention was focused
on the drug when in late May of this year, the FDA refused the manufacturer's
request for GRAS/E (Generally Recognized as Safe and
Effective) status, and instead ruled that the drug would Join the Discussion
POLL: Synthroid's Suit
need to go through a mandatory new drug application Against Unithroid:
process. The nine-page denial letter sent by the FDA, dated Legitimate, or a diversionary
tactic?
April 26, 2001, included a detailed list of concerns Take the poll now!
regarding Synthroid's potency, stability and
manufacturing processes.
Related Resources
According to today's press release, Abbott is asking a Federal • Synthroid Controversy
Information Center
court to stop alleged advertising activities by Watson • April 26, 2001 FDA Letter to
against Synthroid. Abbott is also asking the court to order Synthroid, Denying August 2001
Deadline Change• Synthroid Files
Watson to run an advertising campaign to, as Abbott Suit Against Unithroid's
claims in their release, "correct the deliberate Distributor
• Doctor Discourages Panic Over
misinformation it has created within the medical Possible Withdrawal Of Synthroid
community." • Synthroid's Price Up 22.6% in
2000, One of Biggest Price
Jumpers
Abbott's press release alleges that Watson is "inundating
patients with alarming, medically-inaccurate
information." In an interview conducted by telephone
Elsewhere on the Web
with David Pizzuti, M.D., Abbott's Vice President, Global
• June 1, 2001 Wall Street
Medical Affairs by Mary Shomon on June 12, 2001, Pizzuti Journal Article about Synthroid
clarified information of concern, which he says included:
"press releases issued by Watson, some before the
GRAS/E (Generally Recognized as Safe and Effective) petition was denied; a
promotional mailing that contained statements such as 'the FDA is threatening to
remove Synthroid due to questionable quality' which misstates the facts; and
verbal concerted actions by the Watson sales force."
Rob Funsten, Senior Vice President and General Counsel for Watson
Pharmaceuticals, also speaking to Mary Shomon in a June 12, 2001 interview,
indicated that Watson had not yet been served with papers by Abbott, and he did
not as yet have a copy of the lawsuit, so he would be unable to comment on
anything beyond what was outlined in the Abbott press release. Based on the
press release, however, Funsten said, "Nothing that has come to my attention
would say there is any merit to this whatsoever. It strikes me as an act of
desperation.
According to Funsten: "The whole motivation behind this lawsuit may say more
about Abbott and the fact that Synthroid is unapproved than about Watson."
In looking at Abbott's allegations, a review of recent press materials sent out by

Watson indicated that they issued a release on May 1, 2001, titled Unithroid (TM)
the Only NDA-Approved Levothyroxine Sodium Approved as Safe And Effective by the FDA,
Having Demonstrated Stability, Consistent Potency, And Dose Proportionality. That release,
however, does not name any competing products -- including Synthroid -- by
name.
"The whole motivation behind this lawsuit may say more about Abbott
and the fact that Synthroid is unapproved than about Watson." -- Rob
Funsten, Sr. VP & General Counsel, Watson Pharmaceuticals
The May 1, 2001 Watson release also stated that, "To date, only the
manufacturer of Unithroid has received NDA approval. This means that there is
only 1 levothyroxine sodium currently available that the FDA has approved as
safe and effective, having demonstrated stability and consistent potency, as well
as dose proportionality." According to FDA reports, that statement was true as of
the release date of May 1, 2001, and remained correct until a second
levothyroxine drug, Levoxyl, manufactured by King Pharmaceuticals, was approved on May
25, 2001.
In terms of promotional mailings and sales presentations, these are typically

targeted to pharmacies, and not patients. Without the more detailed explanation
that would be found in the actual lawsuit documents, it's not clear how Abbott
plans to demonstrate how such marketing activities are adversely affecting
patients, as Abbott has alleged.
"One of the things that surprised a lot of people was the June 1st Wall Street
Journal article," says Funsten. "Until then, a lot of people weren't aware of that
FDA letter, they weren't aware that Synthroid hadn't received approval. It strikes
me that Abbott is afraid of people becoming more informed about this issue."
The controversy centers on concerns over Synthroid that came to light with the
publication of the FDA's letter denying the GRAS/E petition for Synthroid, a
development which forced the manufacturer to announce that it would make a
new drug application. The nine-page denial letter sent by the FDA to Synthroid's
manufacturers detailed a history of potency, stability and manufacturing problems.
"The FDA letter is not saying that Synthroid not safe," said Pizzuti, "It is saying
'we think you need to file the NDA, we can't approve the GRAS/E.'" According to
Pizzuti, "We thought it was irresponsible and medically incorrect to imply that the
drug is not safe and effective."
In June 6 and 7, 2001 letters from Abbott to patients, pharmacists and healthcare
practitioners, (Letter to Pharmacists, Letter to Healthcare Providers, Letter to Customers)
Abbott wrote: "Abbott wants to reassure physicians and patients that the safety
and efficacy of Synthroid has been extensively studied and the results have been
published in peer-reviewed journals such as the New England Journal of
Medicine."
In addition, they have written: "Recently, FDA informed Abbott that it would not
grant GRAS/E status for Synthroid under Knoll's citizen petition. This only means
that an NDA will be required for Synthroid. This is not a reflection of the safety
and efficacy of the product, but a regulatory issue."
The Abbott letters fail to mention, however, the nine pages of product safety,
efficacy, potency and stability concerns detailed by the FDA in the denial of the
GRAS/E status, or why the FDA would choose to so extensively outline these
concerns. The FDA's letter regarding Synthroid provides a detailed accounting of
specific safety and effectiveness problems the agency found with Synthroid, and
reasons why the citizen's petition for Synthroid was denied.
Said the FDA: "Although you claim that Synthroid has been carefully
manufactured, the violations of current good manufacturing practices discussed
above indicate that Knoll has not always manufactured Synthroid in accordance
with current standards for pharmaceutical manufacturing."
The FDA's letter also goes on to say that : "...patients using Synthroid have
experienced significant, unintended variations in their doses of levothyroxine
sodium...these variations are not conducive to proper control of hypothyroidism."
"The FDA letter is not saying that Synthroid not safe. It is saying 'we think you need to file the
NDA, we can't approve the GRAS/E.'" -- David Pizzuti, M.D., Vice President, Global Medical
Affairs, Abbott Pharmaceuticals
Dr. Pizzuti had no comment when asked why the FDA chose to deny Synthroid's
request with a detailed and extensive nine-page accounting of product problems,
rather than a simple denial of the GRAS/E request and statement that the new
drug application would need to be filed.
Abbott's press release cites support for Synthroid from various professional and
patient groups, including the American Association of Clinical Endocrinologists,
the American Thyroid Association, the Thyroid Foundation of America and the
Thyroid Cancer Survivors' Association. When asked whether or not the financial
support provided by Synthroid to each of these groups has an impact on their public
support for Synthroid's FDA battles, Pizzuti indicated: "From what we know,
they're supported by a lot of different sources; the degree to which we support
them is relatively small. We're not the only company that gives to them."
The influence pharmaceutical companies typically wield over physicians and

professional organizations -- and in particular, the case of Synthroid -- was
profiled in a cover story in the Nation magazine in March of 1999. In "Money +
Science = Ethics Problems on Campus," writer David Shenk interviewed Drummond
Rennie, who at the time was the West Coast deputy editor of the Journal of the
American Medical Association.
In talking about the research study, Shenk wrote:

Knoll also used its near-omnipotence in the thyroid community to keep the study under wraps, Rennie
says. Perhaps the most vivid illustration of this came when the American Thyroid Association
considered a resolution urging the company to allow the study to be published. "That vote was on an
absolute no-brainer, which was, 'Should we, as the Thyroid Association, write to the manufacturer and
say, Please publish this paper?' I can't think of any easier question. It's a matter of basic academic
freedom. And it was turned down. That is most extraordinary." One inescapable conclusion is that the
defeat had something to do with the fact that Knoll provides more than 60 percent of the Thyroid
Association's funding. Indeed, Rennie claims that three people present for the fateful vote later told him
that as they considered the proposition, one member openly remarked, "We mustn't kill the golden
goose."
One key point in Abbott's press release detailing their lawsuit stated that Watson
was "making false assertions that Synthroid will be unavailable after the August
deadline."
It's not clear how Abbott plans to support this claim. The original FDA notice calling
for all levothyroxine products to go through the new drug application process, which was
issued in 1997, stated:
After August 14, 2000, any orally administered drug product containing levothyroxine sodium,
marketed on or before the date of this notice, that is introduced or delivered for introduction into
interstate commerce without an approved application, unless found by FDA to be not subject to the
new drug requirements of the act under a citizen petition submitted for that product, will be subject to
regulatory action.
That notice was later amended to extend the deadline one year until August 14,
2001.
With a nine to ten month typical timeframe for approval of a levothyroxine

product, Synthroid, which according to Pizzuti will apply "sometime before August
14th," is clearly not likely to obtain approval by the August 14, 2001 deadline.
Dr. Pizzuti says that Abbott has interpreted the FDA to mean that the act of
applying before the August 14, 2001 will ensure that Synthroid remains available
on the market with no interruption. Says Pizzuti, "We are working directly with
the FDA to clarify exactly what to do to keep it on the market."
While the initial Federal Register notice threatens "regulatory action" against any
unapproved products being marketed after the deadline, in a letter dated April
26, 2000 to Synthroid manufacturer Knoll Pharmaceuticals, the FDA makes it
clear that they viewed the August 14, 2001 deadline is a firm one, saying:
"The FDA denies Knoll's request to set a date by which NDAs must be submitted rather than
approved...We believe the additional year the Agency is allowing for all sponsors to obtain NDA
approval grants in substantial part Knoll's request for additional time to comply with the 1997 notice.
(To read the full letter, download the Portable Document Format (PDF) version at
the FDA website: http://www.fda.gov/ohrms/dockets/dailys/00/may00/050400/pav0001.pdf)
More recent verbal statements by the FDA have been more vague, however, and
this ambiguity leaves open the question of whether the deadline will be
interpreted as applying to approval and not application, and whether an
unapproved Synthroid product will be pulled off the market by the FDA in August
until such time as FDA approval is granted. The FDA's letter indicating that the
deadline will not be extended also calls into question Abbott's ability to legally
demonstrate that Watson's assertions that "Synthroid will be unavailable in the
near future" are false, as Abbott maintains.
Tim Fuller, Executive Director of the Gray Panthers, has said in a press release in
May, "The FDA clearly stated that a New Drug Application for Synthroid must be
approved by August, not just submitted. We should not allow Abbott to ignore the
law for its own convenience while patient safety is at risk, especially since safe,
effective, and approved alternatives are available.''
The Gray Panthers have targeted Abbott in a consumer and patient advocacy
effort against companies it perceives to be engaged in anti-competitive or anti-
consumer behavior.
In response to the news regarding the Abbott lawsuit against Watson, Fuller had
this comment: "I can't imagine why it is that one company would restrain the
other company from telling the truth. There's nothing I've heard or read from any
side that been unclear."
It's likely that the battle over FDA approval for Synthroid will be a hot topic at
next week's Endocrine Society annual meeting, Endo 2001, taking place from
June 20-23, 2001 in Denver. According to preliminary exhibitor lists, the
manufacturers of Synthroid, Levoxyl and Unithroid all will have booths at the
event. It was just announced on June 13, 2001 that Gray Panthers will also have
a booth at Endo 2001, to represent consumers, speak to the issues raised by the
FDA's denial of GRAS/E status, pass out the FDA letter and other relevant
information, and answer questions regarding the levothyroxine controversy.
In addition, the Gray Panthers have just announced that on June 21, 2001, they
will be sponsoring the Gray Panther's Town Hall meeting at the Hyatt Regency
Denver, 1750 Welton Street, near the Convention Center. This meeting, open to
the public, will be held in the Mount Elbert Room, from 2 p.m. to 4 p.m. Titled
"Synthroid: Addressing consumer concerns about safety and efficacy," the panel
discussion, which will be moderated by Tim Fuller, is inviting representatives from
the various drug companies to speak to the issues that have been raised by the
FDA regarding levothyroxine drugs and Synthroid.
Above all, the question on most patients' minds is what will happen to Synthroid
after the August 14, 2001 deadline. Watson's Funsten doesn't know. When asked
whether he thought the FDA would allow Synthroid to continue to be sold, he
said: "As to what reason there would be to allow an unapproved product to stay
on the market, I can't speculate."
http://www.myfoxchicago.com/story/19844748/abbott-laboratories-
lays-off-500-workers-north-chicago
Abbott Laboratories lays off 500 workers


o 2
Posted: Oct 17, 2012 11:06 PM ISTUpdated: Oct 16, 2013 11:07 PM IST
CHICAGO (Sun-Times Media Wire) -
North Chicago-based Abbott Laboratories is laying off 550 workers globally, including 100 in the
Chicago metropolitan area, and plans to cut hundreds more next year, the company said Wednesday.
The diversified medical products maker, which will soon split into two companies, said the cuts are
across its nutritional, vascular, branded generics and molecular diagnostics businesses .
The cuts represent less than 1 percent of its global workforce, Abbott said. The company employs
roughly 13,000 people in the Chicago area.
Abbott also for the first time provided financial profiles of the post-split companies and reported third
quarter earnings that nudged past analysts' expectations.
Executives said Abbott remains on track to complete its separation into two companies Jan. 1, 2013.
AbbVie, which will sell Abbott's proprietary drugs, including its blockbuster rheumatoid arthritis drug
Humira; is forecast to have 2013 sales above $18 billion and gross margin around 76.5 percent, Abbott
senior executives said on a conference call with analysts. Research and development investment will be
approximately 14 percent of sales, and an annualized dividend of $1.60 per share is expected to begin
in 2013, Abbott said.
The other company, which will retain the Abbott name and sell generic medicines, diagnostic tests and
nutritional products; is forecast to have 2013 sales of roughly $23 billion and gross margin of roughly 55
percent. Research and development investment will be roughly six percent to seven percent of sales,
and an annualized dividend of 56 cents per share is expected to begin in 2013, pre-split Abbott said.
After the separation, more detailed 2013 financial guidance is expected to be released by the
companies' fourth quarter 2012 earnings conference call, Abbott said.
Abbott said it earned $1.94 billion in the third quarter amid strong sales of Humira.
Earnings per share were $1.21. That was up from 19 cents a share a year earlier, when the company
earned $303 million as it took a $1.5 billion charge related to litigation over its marketing of its seizure
medicine Depakote.
Excluding special items, Abbott earned $2.08 billion, or $1.30 per share, beating Wall Street
expectations by 2 cents.
Net sales slipped 0.4 percent to $9.77 billion from $9.82 billion. But excluding foreign exchange, sales
rose 4.1 percent.
Sales of Humira rose 10 percent to $2.3 billion.
Abbott reduced the high end of its full-year 2012 guidance range. It said it now expects earnings per
share of $5.06 to $5.08, compared to earlier guidance of $5 to $5.10.
Read more: http://www.myfoxchicago.com/story/19844748/abbott-laboratories-lays-off-500-workers-north-
chicago#ixzz2z7k9WPCf
http://lubbockonline.com/stories/072403/bus_072403004.shtml
Abbott labs subsidiary pleads guilty to obstructing federal probe

Published: Thursday, July 24, 2003
EAST ST. LOUIS, Ill. (AP) — An Abbott Laboratories subsidiary pleaded guilty Wednes day
in federal court to ob structing a criminal health-care investigation.
The subsidiary, CG Nutri tion als Inc., agreed to pay a $200 million criminal fine and $400
million to settle any civil claims in the case. It also agreed to five years' probation.
Judge Patrick Murphy on Wed nesday accepted the guilty plea but he postponed issuing a
final approval of the $600 million settlement agreement until October after a required pre-
sentencing report is conducted.
The settlement stems from Operation Headwaters, a federal inquiry into fraudulent sales of
tube-feeding gear and other medical equipment.
Prosecutors set up a fake medical equipment store in Swansea in southern Illinois as part of
the investigation. Undercover federal agents posed as buyers of medical devices videotaped
Abbott Lab oratories salespeople urging them to overcharge Medi care and Medicaid for the
equipment, prosecutors said.
Abb ott has said it has cooperated with the government since the company first learn ed of the
investigation in 2001.
Abbott spokeswoman Melissa Brotz said the company has expanded and enhanced its ethics
and compliance training in the past several years.
In trading Wednesday on the New York Stock Exchange, Abbott shares fell 64 cents to close
at $40.80. The shares fell 30 cents more in extended trading.
http://www.thenalfa.org/blog/fee-allocation-dispute-in-abbott-lab-settlement/
Fee Allocation Dispute in Abbott Labs Settlement

January 24, 2013
A recent Thomson Reuters News story, “Fee Dispute Over $1.5B

Abbott Laboratories Settlement,”reports New York law firm Wolf Haldenstein Adler Freeman & Herz has
sued Delaware plaintiffs’ firm Grant & Eisenhofer over legal fees generated by a $1.5 billion settlement
between Abbott Laboratories and government authorities. In a lawsuit filed Friday in New York
Supreme Court, Wolf Haldenstein claimed that Grant Eisenhofer had failed to pay Wolf Haldenstein its
fair share, or at least $150,000, of the settlement’s legal fees.
The federal whistle-blower suit concerned alleged off-label promotion by Abbott Laboratories of
Depakote to treat dementia and schizophrenia, for which the prescription drug had not been approved
by the U.S. Food and Drug Administration. In May 2012, Abbott agreed to a $1.5 billion settlement with
federal and state governments, the third-largest payment by a pharmaceutical company in a lawsuit.
According to Wolf Haldenstein, former partner Reuben Guttman originated the lawsuit, but left Wolf
Haldenstein in July 2007 to join Grant Eisenhofer, bringing the litigation with him. Wolf Haldenstein
claimed its lawyers and support staff were responsible for 267 hours of legal work associated with
drafting the lawsuit. The work included analyzing thousands of pages of Abbott’s documents and emails
obtained through a whistle-blower, researching legal issues and developing claims theories of liability,
according to the suit. Wolf Haldenstein claimed it is owed at least $150,000 out of the “millions of
dollars” in legal fees Grant Eisenhofer earned in the settlement.
http://madisonrecord.com/issues/332-class-action/261202-final-hearing-in-abbott-lab-food-pump-
class-action-set-dec-12-charity-to-get-6-7m-lawyers-3m-and-class-zero
Home » News » St. Clair County »

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Final hearing in Abbott Lab food

pump class action set Dec. 12;
Charity to get $6.7M, lawyers $3M
and class zero
November 26, 2013 11:00 AM
By STEVE KORRIS
Sprague
Lombardi
Hepler
Abbott Laboratories and plaintiff lawyers seek final approval of a class

action settlement providing $6.7 million for charity and zero for the
class.
Both sides presume most class members have died, because the class
consists of persons too weak to eat without Abbott food pumps in a
period that ended 10 years ago.
The lawyers can’t readily identify class members anyway, because

Abbott didn’t transact business with any of them.
The settlement provides $3.29 million for a national team of plaintiff

lawyers including Robert Sprague of Belleville as local counsel.
The settlement provides $10,000 for the lead plaintiff, the estate of
Elizabeth Rath.
A current notice in Reader’s Digest, Good Housekeeping and Woman’s

Day gives class members nothing but a Dec. 5 deadline to exclude
themselves or object.
Those who object in writing can speak at a final fairness hearing before
St. Clair County Circuit Judge Andrew Gleeson on Dec. 12.
The $10 million settlement constitutes a thin remnant of the suit’s
potential in 2004, when Rath’s estate filed it.
In 2003, Abbott had agreed to pay $600 million to settle charges that
a subsidiary cheated Medicare by disguising the true costs of food
pumps through distributors.
The U.S. attorney for the Southern District of Illinois had created a
fake distribution company in Swansea to confirm Medicare’s suspicions.
Rath’s estate claimed Abbott cheated Medicare patients too, in

proportion to Medicare’s 80 percent payment share and the class’s 20
percent copayment.
That proportion would have worked out to a $150 million class

settlement.
In 2005, Abbott moved for transfer to a more convenient forum in

Lake County, where the company operates its headquarters.
The estate amended the complaint, and Abbott again sought transfer.
Former circuit judge Michael O’Malley denied the motion in 2010, ruling
that Abbott could not meet its burden.
“The purported scheme which is the basis for the civil action was
discovered, investigated and presented in St. Clair County,” he wrote.
Abbott petitioned the Fifth District appellate court for leave to appeal,
and the Fifth District denied the petition.
Abbott petitioned the Illinois Supreme Court for an order requiring the
Fifth District to allow an appeal, and the Supreme Court granted the
order.
Abbott pleaded to the Fifth District that O’Malley’s order was
inadequate, and Fifth District judges didn’t disagree.
“An inadequate record, however, is not itself a basis for reversal,”

Justice Richard Goldenhersh wrote last year.
“The issue is not the detail of the underlying order, but whether the
circuit court abused its discretion,” he wrote.“Regardless of which facts
are likely to be disputed at trial, the genesis of plaintiff’s complaints in
the investigation makes this a local controversy for St. Clair County.”
Justice Bruce Stewart concurred.
Justice Stephen Spomer reluctantly joined the opinion, writing that

Illinois forum and venue law mandated his concurrence.
He wrote that the law “does not lend itself to uniform application and
promotes long and costly litigation processes, as is illustrated by the
procedural history of the case at bar.”
“My hope for the future is that an amendment to current law would
limit venue to the county or counties where the accident or transaction
giving rise to the cause of action occurred, which would eradicate the
practice of forum shopping and eliminate the need for costly forum non
conveniens litigation completely,” he wrote.
“If the defendant had requested transfer to Jackson County, where the
plaintiff was allegedly defrauded, I would more likely find that this
factor strongly favored Jackson County.”
When the case returned to St. Clair County, O’Malley had left the
bench for private practice and Circuit Judge Andrew Gleeson had taken
the case.
Gleeson set a class certification hearing for this March, and delayed it
twice while negotiations advanced.
Abbott and plaintiff lawyers executed an agreement in August, with

Abbott pledging to donate $6.7 million worth of Ensure or Glucerna
food products over three years.
Sprague signed the agreement for the estate, as did Dale Aschemann
of Marion.
Randy Patchett, Timothy Keller, and Jay Schafer, all of Marion, also
represented the estate, as did Charles Barrett and Patrick Barrett of
Nashville, Tenn., and David Stellings and Rachel German of New York
City.
David Dahlquist of Chicago signed for Abbott.
George Lombardi of Chicago also represented Abbott, along with Larry

Hepler and Jason Rankin of Edwardsville.

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Dear Mr. White,

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In order for this Committee to effectively and efficiently conduct this

5. For the period beginning January 1, 1998, to the present, please

a. the total number of units of the subject drug received by that

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