Johnson & Johnson (JNJ) promoted illegal marketing of its antipsychotic drug Risperdal by paying physicians to give favorable speeches, subsidizing golf trips and even having sales staff “butter up doctors” with bags of“Risperdal Popcorn,” a former company manager testified.
J&J executives urged salespeople in 2003 to increase visits to doctors who treat children as part of an effort to generate more than $1 billion in annual sales of the drug, Tone Jones, a former J&J sales manager, said today in Pennsylvania state court in Philadelphia.
The trial stems from a lawsuit by Andrew Bentley, a Texas teenager who blames the medicine for causing him to grow female breasts. Bentley’s case against the pharmaceutical manufacturer is one of about 420 lawsuits claiming injury by Risperdal, the New Brunswick, New Jersey-based company said last month in a regulatory filing.
J&J didn’t illegally market the drug and Risperdal didn’t harm Bentley, Laura Smith, the company’s lawyer, said yesterday in opening statements.
Wrongdoing DeniedJ&J denied any wrongdoing.
“During the time it was actively promoted, our policy was to promote Risperdal in its FDA indication,” Teresa Mueller, a company spokeswoman said today. “We take our obligation to ensure the safe and appropriate use of our medication very seriously.”
The 17-year-old Houston resident claims he took Risperdal to treat conditions related to Asperger’s Syndrome when federal regulators hadn’t approved the drug for use by children, according to court filings. His lawyers argued J&J illegally marketed the pills to rack up more than $1 billion in sales.
The U.S. has been investigating Risperdal sales practices since 2004, including allegations the company marketed the drug for unapproved uses, J&J executives said in a regulatory filing.
Company officials reached an agreement with the U.S. Justice Department to pay as much as $2.2 billion to resolve probes of its sales of drugs, including Risperdal, according to people familiar with the matter.
The company last month agreed to pay $181 million to resolve claims by 36 states that it improperly marketed and advertised Risperdal and Invega, another antipsychotic.
Arkansas CaseIn April, a judge in Arkansas ordered the drugmaker to pay $1.2 billion in fines over Risperdal marketing. That verdict came three months after J&J decided to end a trial in Texas over the drug’s sales with a $158 million settlement. The Texas case included claims that the company marketed the drug for children while lacking approval by regulators for such use.
The drug’s global sales peaked at $4.5 billion in 2007 and declined after the company lost patent protection. Risperdal generated $3.4 billion in sales in 2008, or 5.4 percent of J&J’s revenue, according to company filings. Sales of the drug fell to $527 million in 2010, according to earnings reports.
Jones, the ex-sales manager who testified today, is a former quarterback for the Oklahoma State University Cowboys. He told the jury that he became one of J&J’s top Risperdal salespeople after he joined the company in 1998.
Jones quickly rose to become a district manager at the Janssen unit who trained other members of the sales force about Risperdal marketing techniques, he said.
Training SessionHe testified that he was shown a set of slides entitled“Child & Adolescent Physicians” at a 2003 training session designed to pump up Risperdal’s sales.
The slides urged salespeople to focus Risperdal marketing efforts on doctors who “provide treatment to patients who are under the age of 18,” Jones testified.
U.S. Food and Drug Administration officials didn’t approve Risperdal for use in children until 2006, Jones testified. It was approved for additional uses in children the next year
Under U.S. law, a doctor can prescribe a medicine for any condition, as long as the FDA has found it to be safe and effective against at least one ailment. Drug companies, however, aren’t allowed to promote a drug for uses other than those approved by the FDA.
Jones said another slide showed Janssen officials knew the lack of FDA approval would make it more difficult to sell Risperdal for use in children. The slide, shown to jurors, noted the drug had “No Indication!!!!” for that use, he said.
Company PolicyJ&J’s lawyers have told jurors that company officials formulated a policy that called for salespeople to be fired if they were found to have illegally marketed Risperdal.
Jones testified yesterday he didn’t know any member of Janssen’s sales force that was fired for marketing Risperdal for use by children, and added that he received bonuses specifically tied to such sales.
In 2001, for example, Jones received more than $12,000 in bonuses for Risperdal sales to doctors who treated children and teens, according to company records shown to jurors.
To help sell the drug, J&J officials came up with red bags of microwaveable “Risperdal Popcorn,” Jones said. Company officials wanted salespeople to “butter up doctors with Risperdal Popcorn,” he added.
Sales people also paid doctors as much as $1,500 a speech to talk about Risperdal at dinners with their colleagues, Jones said. The company subsidized golf trips for physicians who were regular prescribers of the drug, he added.
Cross-ExaminationDuring cross-examination, Jones acknowledged he was fired from Janssen in 2009 after approving more than $2,000 in expenses, including drinks and lap dances, racked up by a sales rep at a Houston strip club. He later sued Janssen over his dismissal, Jones said.
The former quarterback said he now works as a sales manager in the U.S. for Sanofi (SAN), France’s biggest drugmaker, overseeing sales of an anti-psychotic drug that competes with Risperdal.
Smith, one of J&J’s lawyers, questioned whether Jones knew who authored the slide that talked about buttering up doctors with Risperdal Popcorn.
“I remember seeing it at a meeting,” the former sales manager said. Jones added that he didn’t know who created the slide.
Smith produced a copy of the slide posted to Pharmalot.com, a blog that covers the health-care industry. The Internet site is produced by Ed Silverman, who formerly covered the pharmaceutical industry for the Newark Star-Ledger newspaper.
Slide SourceJ&J’s lawyer asked Jones whether the slide came from the Pharmalot site. The former sales manager said he’d only seen it as a Janssen document.
Silverman denied in an interview today that he was the slide’s author, saying it was sent to him by an anonymous contributor. “I was the first to post the photo. Someone sent it to me,” he said. “There is no way I made this up.”
Jones testified that Alex Gorsky, J&J’s current chief executive officer, was head of the Janssen unit while he worked for the company. Risperdal sales rose to almost $2 billion annually under Gorsky’s tenure, Jones added.
Bentley’s lawyers asked to have Gorsky ordered to testify in the case. The executive responded that he’d be traveling in Asia during the trial and had already testified via deposition. A judge refused last week to order Gorsky to appear.
The case is A.B., a minor v. Janssen Pharmaceuticals, 00649, Philadelphia Court of Common Pleas, January Term 2010.
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