Johnson & Johnson fined $1.1B

LITTLE ROCK, Ark. -- An Arkansas judge fined Johnson & Johnson and a subsidiary more than $1.1 billion Wednesday after a jury found that the companies downplayed and hid risks associated with taking the antipsychotic drug Risperdal.

Circuit Judge Tim Fox determined that Johnson & Johnson and its subsidiary, Janssen Pharmaceuticals Inc., committed nearly 240,000 violations of the state's Medicaid fraud law, or one for each Risperdal prescription issued to state Medicaid patients over a 3 1/2-year period. Each violation carried a $5,000 fine, the state's mandatory minimum, bringing the total to more than $1.1 billion.

Fox issued an additional $11 million fine for more than 4,500 violations under the state's deceptive practices act, but he rejected the state's request to levy fines in excess of the $5,000 minimum for the Medicaid violations.

Attorney General Dustin McDaniel said in an emailed statement that the ruling "sends a clear signal that big drug companies like Johnson & Johnson and Janssen Pharmaceuticals cannot lie to the [U.S. Food and Drug Administration], patients and doctors in order to defraud Arkansas taxpayers of our Medicaid dollars."

Janssen issued a statement in which it said, "We are disappointed with the judge's decision on penalties. If our motion for a new trial is denied, we will appeal." The Arkansas Supreme Court would hear the appeal.

Risperdal, introduced in 1994, is a "second-generation" antipsychotic drug that earned Johnson & Johnson billions of dollars in sales before generic versions became available several years ago. It is used to treat schizophrenia, bipolar disorder and irritability in autism patients. Risperdal and similar antipsychotic drugs have been linked to increased risk of strokes and death in elderly dementia patients, seizures, weight gain and diabetes.