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Novartis agrees to pay $422 million for alleged illegal marketing

By Terry Frieden, CNN Justice Producer
  • The Justice Department says Novartis will plead guilty to a misdemeanor
  • The allegations concern the company's anti-epileptic drug Trileptal
  • Former Novartis employees blew the whistle on the company

Washington (CNN) -- Novartis Pharmaceuticals Corp. has agreed to pay $422.5 million to resolve claims it illegally marketed some of its widely used products.

The Justice Department announced Thursday that Novartis will plead guilty to a misdemeanor and pay $185 million for promoting the anti-epileptic drug Trileptal, which was approved for that use by the Food and Drug Administration, for unauthorized, or "off label" uses, such as using it to treat psychiatric and pain issues.

"Once a pharmaceutical is approved by the FDA, a manufacturer may not market or promote it for any use not specified in its new drug application," the Justice Department statement said.

The department said Novartis will also pay $237.5 million to resolve civil allegations that the company also unlawfully marketed six drugs, including Trileptal, "and thereby caused false claims to be submitted to government health care programs."

Nearly $150 million will go to the federal government and $88 million will be divided among states for the Medicaid share of the civil settlement.

That civil settlement resolves four lawsuits filed by whistleblowers -- all former Novartis employees -- who will share a total of more than $25 million, the Justice Department said.