South Carolina Wins $327 Million from Drugmaker in Unfair Trade Practices Suit

Earlier this month, the State of South Carolina was awarded $327 million in damages from drugmaker Janssen Pharmaceutica, Inc., a Johnson & Johnson subsidiary, under the state’s Unfair Trade Practices Act for deceptive marketing of its anti-psychotic drug, Risperdal.  The suit alleged that the company had, for years, sent deceptive letters to doctors in which the company downplayed the links between Risperdal and diabetes.  As we previously reported here, South Carolina could have received upwards of $3 billion dollars from the suit, as the State Attorney General argued that every single prescription, sample box or “Dear Doctor” letter written since the 1990s could constitute a violation of the law worthy of a $5,000 penalty.

It was in April that the South Carolina jury found the drugmaker to be responsible.  Only recently did Spartanburg County’s Judge Roger Couch determine the amount that the company would be responsible for paying the state.  Charleston’s The Post and Courier reported that Judge Couch, in his order, wrote that Janssen knew that its drug was associated with health problems and that it intentionally hid those studies.  He said the company “systematically set about in a concerted effort to conceal that information and to manipulate the information available to the public for the purpose of protecting or improving its market share.”

The award reportedly marks the largest penalty for breaking the South Carolina Unfair Trade Practices Act and also represents the state’s largest award in a drug marketing case. reports that on June 3, Janssen officially announced that it will appeal Judge Couch’s order.  It maintains that  company fully disclosed Risperdal’s health risks and that it properly marketed the anti-psychotic medicine.

As we previously reported, this South Carolina case is not the first of its kind.  A Pennsylvania case was dismissed in June, and another case in West Virginia was dropped in December.  A case in Pennsylvania, however, ended with a jury’s awarding of $257.7 million to the state for the drug company’s alleged offenses similar to those addressed in Judge Couch’s recent order.  As with the recent South Carolina verdict, Janssen has appealed the Pennsylvania verdict and maintains it acted properly.

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