Aegerion Pharmaceuticals has agreed to pay $40 million and plead guilty to two misdemeanor charges to settle allegations of improperly marketing a pricey cholesterol drug and violating different federal laws.
Specifically, the company failed to market Juxtapid, which costs about $250,000 a year and is used to treat a rare form of high cholesterol, with adequate directions. The settlement, which is still preliminary, also notes that the drug maker failed to comply with the terms of a mandatory program for ensuring that the risks of taking the medicine are followed by doctors and patients.
In a statement released on Thursday announcing the settlement, Aegerion acknowledged obstructing justice concerning the risk management program, and violating both the Health Insurance Portability and Accountability Act and the False Claims Act. The specific nature of the violations was not disclosed.
The deal was reached with the US Department of Justice and the US Securities and Exchange Commission. The drug maker noted that under preliminary terms of the settlement, it will not be excluded from doing business with federal health care programs, such as Medicaid and Medicare. However, Aegerion will be required to enter into a Corporate Integrity Agreement, which means company executives will be responsible for bolstering and overseeing compliance efforts.
The settlement comes nearly a year after former Aegerion Chief Executive Marc Beer resigned amid a controversy over comments he made about Juxtapid during two different appearances on CNBC’s “Fast Money” television show in 2013. In one episode, Beer said that “patients are going to die of a cardiac event, either a stroke or a heart attack, if we don’t have them on therapy.”
The remarks raised the ire of the US Food and Drug Administration, which sent a letter to the company warning it that his comments “misleadingly” suggested that the drug could reduce cardiovascular events and prolong life. The FDA approval was based on data showing that the pill lowers cholesterol levels in people with a rare genetic disease, homozygous familial hypercholesterolemia. But the company did not submit data showing its drug lowered the risk of a heart attack or death.
And in January 2014, the drug maker received a subpoena from the Justice Department requesting documents regarding its marketing and sale of Juxtapid. Aegerion and Beer are currently defendants in a class action lawsuit brought by shareholders, who claimed his remarks damaged the value of Aegerion stock.