$1.6 Billion Settlement in Abbott Drug Claims

It promoted anti-seizure drug Depakote for unapproved uses

   

Federal and state regulators have reached a settlement with Abbott Laboratories (NYSE:ABT) over charges that the company marketed its anti-seizure medication Depakote for conditions not approved by health officials.

Under the agreement, Abbott will enter a guilty plea to a misdemeanor violation of the Food, Drug and Cosmetic Act. The company will also participate in a government oversight program for five years. Abbott will also pay a $700 million criminal fine, $800 million in state civil charges and $100 million to state consumer regulatory agencies.

abbottLogo e1293650852771 $1.6 Billion Settlement in Abbott Drug Claims
Abbott Laboratories Is Cheaper Than You Think

Whistleblowers who filed suit against Abbott’s will share $84 million from the settlement.

Regulators called Abbott’s behavior intentional and systematic.

Abbott’s settlement is the largest for drug manufacturer marketing claims since Pfizer (NYSE:PFE) settled with the government in 2010 for $2.3 billion.

Later this year, Abbott will split into two publicly traded companies: AbbieVie, which will make drugs, and Abbott, which will produce other medical products. Abbott shares closed up 10 cents at $62.51 on Monday.


Article printed from InvestorPlace Media, http://investorplace.com/2012/05/1-6-billion-settlement-in-abbott-drug-claims/.

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