A number of large off-label cases were settled by the Department of Justice over the years. Hodgson Russ represented two of five relators in the Risperdal off-label case against Janssen, a wholly-owned subsidiary of Johnson & Johnson. Janssen was selling Risperdal off-label for the treatment of dementia in the elderly and for disruptive children. Both of these off-label applications were proven to be unsafe and had side effects associated with them. The case settled for $2.3 billion in FCA damages and another $1 billion in fines and restitution.
Post-Risperdal, the law changed with the Supreme Court’s decision in Escobar. Escobar imposes a “materiality” requirement in FCA cases. In simple terms, that means a relator must show that, had the government known about the falsity of the claim, it would not have paid it. Translated to off-label cases, the Department of Justice now requires some “plus” factors before it will pursue an off-label case. Generally, this means that relators must show patient harm as a result of the off-label sales. This can include actual side effects, undisclosed studies, patient jeopardy, etc.
As a result, off-label cases have become more difficult to bring. Nonetheless, the Department of Justice eagerly embraces cases involving off-label offenses when, as a result, there is the potential or actual harm to patients.