Eli Lilly & Co. | Zyprexa Settlement | Eli Lilly Settles West Virginia Lawsuit

Eli Lilly ’s West Virginia $22.5 million Zyprexa Lawsuit Settlement

On August 20, 2009, Bloomberg news announced that Eli Lilly & Co. has agreed to pay $22.5 million to settle a Zyprexa lawsuit brought by the state of West Virginia claiming the company improperly marketed its antipsychotic drug Zyprexa. Zyprexa has been the subject of federal and state investigations into whether the company marketed the drug, approved for schizophrenia and bipolar disorder, for unapproved, or off-label, uses.

Eli Lilly will pay $15.75 million to West Virginia and $6.75 million to lawyers representing the state, according to a court filing unsealed today. The West Virginia agreement calls for Eli Lilly to pay $14.75 million to be used to fund behavioral mental health services and $1 million for consumer protection purposes in the state. Eli Lilly didn’t admit any wrongdoing in settling the lawsuit.  The West Virginia Zyprexa case is part of In re: Zyprexa Products Liability Litigation, 04-MD-1596, U.S. District Court, Eastern District of New York (Brooklyn).

The West Virginia Zyprexa suit was one of a dozen state Zyprexa claims pending against the company seeking reimbursement for funds spent on Medicaid, the government’s health program for the poor.  According to Bloomberg news, Eli Lilly & Co. had previously settled a Zyprexa marketing investigation in January with the U.S. Justice Department and promised to pay $1.42 billion, including roughly $362 million to more than 30 states.  Zyprexa, part of a class of medications called atypical antipsychotics, has been linked to excessive weight gain and diabetes. The Zyprexa lawsuits also claim Eli Lilly failed to properly warn of Zyprexa’s side effects.

U.S. District Judge Jack Weinstein in Brooklyn last week urged states to settle their marketing claims against Eli Lilly over Zyprexa. Weinstein is overseeing all federal-court lawsuits over the drug.   “A global settlement of all cases, including those pending in state courts is desirable,” Weinstein said in an Aug. 17 decision.  Eli Lilly continues to face Zyprexa lawsuits by Connecticut, Louisiana, Pennsylvania, South Carolina and seven other states alleging that the company withheld information about the side effects of Zyprexa, such as diabetes, and encouraged sales of the drug for unapproved purposes, including dementia and depression. Eli Lilly is scheduled to begin trial Sept. 14 in South Carolina over that state’s Zyprexa lawsuit. The only trial of a state’s lawsuit ended in March 2008 with an out-of-court settlement in which Lilly agreed to pay Alaska $15 million.  Eli Lilly also agreed in October to pay a total of $62 million to 32 states and the District of Columbia to settle consumer protection claims over improper marketing.