Life Science Compliance Update

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February 16, 2018

Aegerion Sentenced to Pay $7.2 Million to Patients


On January 30, 2018, Federal U.S. District Court Judge William Young sentenced Aegerion to pay some of the roughly $36 million fine for off-label marketing to Juxtapid patients. In November, Judge Young rejected an initial plea deal between the Department of Justice (DOJ) and Novelion Therapeutics (who now owns Aegerion) because it would have restricted his ability to impose a sentence upon the company.

Judge Young instead sentenced Aegerion in a deal that gave him discretion to determine how the payment would be split up. Young ordered the company to pay $7.2 million – the same amount the company had agreed to pay from the beginning – as part of the total $40.1 million fine.

Young’s concern with the DOJ-Aegerion agreement was that it was a fine that entirely went to the government, he instead wanted it to go to ninety-one patients who may have been harmed by Aegerion’s conduct. In a statement to the prosecution, Young stated, “I think you ought to pay more attention to the actual people who were harmed here.” He also went on to say, “I feel so strongly that people who were harmed by this criminality ought to have some recompense,” as quoted by the Boston Globe.

The patients who were affected and are set to receive a portion of the fine had taken Juxtapid for reasons other than the FDA-approved marketed reasons (which was to treat high cholesterol in people with a rare genetic disease). Instead, the company promoted the drug to patients who did not have the rare genetic disease, some of whom wound up with side effects including liver toxicity and gastrointestinal distress.

During court on the day of sentencing, Aegerion pled guilty to two misdemeanor counts that it misbranded Juxtapid in violation of the Federal Food, Drug & Cosmetic Act. In total, Aegerion agreed to pay $36 million to resolve criminal and civil claims by the DOJ and a $4.1 million deferred prosecution agreement to resolve a United States Securities and Exchange Commission case.

Jeffrey Hackman, Novelion’s chief operation officer, accepted responsibility for the conduct and stated, “It never should have occurred, and we strive to ensure it never occurs again.”

In a statement, Novelion called the sentence an "important milestone" that allows it to focus on its business going forward. "As a company, we are deeply committed to legal and regulatory compliance," Chairman Jason M. Aryeh said. "We have worked tirelessly to build a culture of integrity and ethics under our new management team and board of directors, in an effort to put legacy Aegerion challenges behind us."

This is certainly an interesting way of sorting out the total fine for the company, and it will be interesting to see if any other judges begin to take the same tact – or better yet, if other companies get out in front of the issue and start to make payments to certain patients as part of settlement deals, or if this is a one-off situation.

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