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⭒ New Developments

Drug Company to Pay $116 Million for Kickback Conspiracy to Push Nuedexta on Nursing Home Residents with Dementia

On September 26, 2019, the U.S. Department of Justice announced that Avanir, a drug company based in California, had agreed to pay $116 million in criminal and civil penalties to resolve charges that it paid kickbacks and engaged in other illegal activities to market Nuedexta as a treatment for elders with dementia. The settlement resolves multiple whistleblower cases concerning the widespread use of Nuedexta to chemically restrain nursing home residents with dementia, which CNN first brought to public attention in its October 2017 story, The little red pill being pushed on the elderly. Nuedexta is only approved to treat a rare neurological condition, pseudobulbar affect, that is characterized by uncontrollable laughing and crying. However, the government alleged that Avanir successfully capitalized on national efforts to reduce the use of antipsychotic drugs on dementia patients in nursing homes by aggressively marketing Nuedexta as a substitute method of controlling residents’ behaviors that would go unnoticed by regulators. According to the DOJ’s press release, the scheme worked so well that one doctor (a paid speaker for Nuedexta) had put entire units of residents on Nuedexta at a nursing home where he worked. The settlement may not be strong enough to deter future misconduct by other drug companies. CNN’s story on the Avanir settlement reports that Medicare’s Part D prescription drug program spent roughly $225 million on Nuedexta in 2017, up more than 700% from five years earlier.