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March 20, 2014

Arkansas court tosses $1.2B judgment against J&J

LITTLE ROCK, Ark. (AP) — The Arkansas Supreme Court on Thursday overturned a $1.2 billion judgment against Johnson & Johnson in a lawsuit challenging the drugmaker's marketing of the antipsychotic drug Risperdal.

The court ruled that the state improperly sued under a law that applies to health care facilities, not pharmaceutical companies.

The ruling comes in an appeal of lawsuit filed by Arkansas against the drugmaker and subsidiary Janssen Pharmaceuticals. The state says the companies didn't properly communicate the drug's risks and marketed it for off-label use, calling the practices fraudulent.

Johnson & Johnson said there was no fraud and Arkansas' Medicaid program wasn't harmed.

Risperdal and similar antipsychotic drugs have been linked to increased risk of strokes and death in elderly patients, along with seizures, weight gain and diabetes.

Risperdal was introduced in 1994 as a "second-generation" antipsychotic drug — and it earned Johnson & Johnson billions of dollars in sales before generic versions became available. The drug is used to treat schizophrenia, bipolar disorder and irritability in autism patients.

Arkansas Attorney General Dustin McDaniel sued the companies in 2007, arguing that they downplayed and concealed risks of the drugs and lied to doctors for years about its side effects. The case is among numerous lawsuits making similar claims.

An Arkansas jury found the New Jersey-based companies liable in 2012. Pulaski County Circuit Judge Tim Fox then ordered the companies to pay $5,000 for each of the 240,000 Risperdal prescriptions for which Arkansas' Medicaid program paid during a 3½-year span.

The lawsuit accused the companies of deceptive trade practices and Medicaid fraud and sought repayment for millions paid out by the state's Medicaid program for unnecessary prescriptions. The original lawsuit identified more than 597,000 prescriptions over a 13-year period, but that number was whittled down after challenges from the drug companies during pretrial proceedings.

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