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Massachusetts Attorney General's Office Investigates Allergan, Inc. for Potential Medicaid Fraud



The Massachusetts Attorney General's Medicaid Fraud Division has its eye on Allergan, Inc., the maker of popular cosmetic injection Botox. Specifically, the Massachusetts Attorney General seeks to probe the eye care consulting group of the eye-focused drug and product maker. Allergan sold $2.3 billion in various pharmaceutical products in 2010. That massive revenue figure amounts to approximately 47 percent of the company's overall revenue for that period.

The Attorney General's Civil Investigation Probe of Allergan

Martha Coakley, attorney general for Massachusetts, issued a civil investigation demand to Allergan in September 2011. Allergan, an eye care drug and product manufacturer based on the West Coast in Irvine, Calif., filed its quarterly report with the United States Securities and Exchange Commission (SEC) disclosing the probe. According to Allergan's disclosures in the SEC report, the Massachusetts probe seeks turnover of certain documents and information from the company. The attorney general is focused upon particular materials that relate to Allergan's consulting group, Eye Care Business Advisor Group, Allergan Access, and BSM Connect for Ophthalmology.

Prior Off-label Promotion Spells Trouble for Eye Care Drugs

The hot seat seems to be getting progressively hotter for the beleaguered company. Just a few months ago, a federal court unsealed a False Claims Act complaint filed by the U.S. Justice Department that alleged Allergan had engaged in off-label promotion and uses of its eye care drugs. The Justice Department alleged the company dispensed cheap or free patient kits to doctors to entice them to prescribe Allergan medications over those made by competitors, in violation of regulations and laws governing off-label marketing.

More specifically, the Justice Department's False Claims Act complaint reveals several troubling facts about the company's prior marketing misconduct. The complaint indicates that Allergan gave ophthalmologists free or below-market price kits for patients. In those free or cheap kits were Acular LS, Pred Forte, and Zymar—all prescription drugs produced by Allergan. Kits also contained eye care products and items such as eye patches, dressings, and sunglasses with cases. The sunglasses carrying cases were emblazoned with the corporation's logo, along with that of the eye doctor. Patient kits violated the rules governing off-label marketing because they promoted drugs for unapproved situations or uses. The kits likewise violated anti-kickback regulations because of what they contained and because the contents were free or priced way below fair market value. In sum, the Justice Department viewed the kits as a form of enticement or inducement to ophthalmologists and physicians to prescribe Allergan eye care drugs and products, rather than those of competitors.

Resources for Injured Consumers or Parties With Pertinent Information

If you have been injured from use of an Allergan eye care drug or product, it is prudent to consult with a product liability attorney or personal injury attorney to learn more about your potential rights and remedies. If you have information relating to Allergan's patient eye kits, off-label marketing and promotion, or Medicaid processing and administration, the Massachusetts Attorney General's Office or the Justice Department should be consulted for more information.