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Information System. Id. at (g)(l)(b)(i).
40.

By way of example, under the Florida Medicaid h o g r a m the determination

of whether a drug is eligible for reimbursement and prescribed for a purpose that is covered by Medicaid is governed by 42 U .S.C. 1396r-8, Chapter 465 F.S., and the Florida Medicaid Prescribed Drug Services Provider Handbook.
41.

In addition to the statutory authority granted by 42 U.S.C. 1396r-8 allowing

state Medicaid programs to exclude or otherwise restrict coverage of outpatient prescription drugs, pursuant to the Florida Medicaid Prescribed Drup Services Coverage. Limitations, and Reimbursement Handbook to be reimbursed by Medicaid, a drug must be medically necessary and prescribed for medically accepted indications and dosages found in the (A) drug labeling ("labeling" means all labels and other written, printed, or graphic matter upon any article o r any of its containers or wrappers, or accompanying such article), the (B) American Hospital Formulary Service Drug Information, the (C) United States Pharmacopeia-Drug Information or the (D) DRUGDEX Information System.
42.

Lilly knew o r should have known the Medicaid regulations governing

prescription drug reimbursement.
42.

Whether the use of a drug is medically necessary was material to Medicaid's

decision to reimburse for prescription. Consequently, the government would have denied reimbursement for claims made for prescriptions of Zyprexa if it had known the purpose for which the drug had been prescribed was medically unnecessary. 43. Use of Zyprexa, for example, for dementia, or for anxiety or depression in

the elderly is not supported by the compendia as medically safe and effective, and therefore should not have been covered by the State of California's Medicaid programs, yet nonetheless, Lilly recklessly has promoted Zyprexa for those and other unauthorized, untested and unproven uses through the methods alleged in this Complaint.
44.

Lilly expected and intended its unlawful Zyprexa promotional efforts to

cause claims for reimbursement to be submitted to, inter alia,Medi-Cal. Lilly designed and implemented its aggressive off-label Zyprexa promotional tactics w;th the intent to -9COMPLAINT FOR DAMAGES

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influence the prescribing choices of long-term care and primary care physicians who treat Medi-Cal beneficiaries. The intended and foreseeable effect Lilly's avaricious scheme was that the Medi-Cal would fund the cost of treatment with Zyprexa through its reimbursement claims system and accordingly, in turn, Lilly would directly and substantially increase its Zyprexa revenue stream at inter alia Medicaid expense.
45.

Until recently, the State of California was unaware of the unlawful manner

in which Lilly promoted Zyprexa off-label within the state and nationally.
46.

Under the California False Claims Act, it is unlawful for any "person," as

defined by the statute, to submit a false o r fraudulent claim to Medicare and Medicaid. The act of submitting a false claim includes by causing another to submit a false claim as well as soliciting, receiving, offering or paying any kickback, bribe or rebate in connection with a Medicaid claim. Cal. Govt. Code $12651 .
47.

The California False Claims Act provides for penalties of up to $10,000.00

for each violation of the foregoing provisions.
48.

Lilly has caused false claims to be submitted to Medicaid for reimbursement

through its promotional efforts in violation of the California False Claims Act.

49.

In summary, throughout the country and in the State of California, Lilly

aggressively and intentionally marketed Zyprexa for non-indicated uses and non-medically necessary uses including for the treatment of general mood and behavior disorders, attention deficit disorder, the attention deficit hyperactivity disorder, depression not associated with psychosis, sleeplessness, autism, Alzheimer's, dementia and aggression and agitation associated with dementia and Alzheimer's. Further, Lilly has intentionally

misrepresented to prescribers who treat Medicaid participants that Zyprexa is safer than less expensive, generic antipsychotics such as Haldol which costs pennies per day rather than the extraordinary expense of Zyprexa.

50.

By and through this and other conduct, Lilly caused tens of thousands of

prescription reimbursement claims for Zyprexa prescribed for medically unnecessary and non-indicated uses to be submitted to the MedicaidIMedicare programs for reimbursement. - 10COMPLAINT FOR DAMAGES

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However, the prescription drug reimbursement claims for off-label uses of Zyprexa Lilly caused to be submitted to the Government a s a direct result of its unlawfully off-label promotion campaign were not eligible for reimbursement from Medicaid, the VA or CHAMPUSiTricare (and Medicare Part D, when it came into effect on January 2006) because such off-label uses were neither listed in the labeling approved by the FDA nor otherwise supported as safe and effective by any of the drug compendia specified by the Medicaid statute.
51.

Lilly engaged in its national Zyprexa promotional blitz with the knowledge

that the majority of Zyprexa prescriptions written as a result thereof are reimbursed by government-funded health programs such as Medicaid, as well as with the knowledge that such prescriptions were for non-medically accepted indications and non-medically necessary uses of Zyprexa that fall outside the coverage of Medicaid.

VII.

BACKGROUND

A.
52.

FDA ReguIation of Drug Companies and their Marketing Practices
A s detailed below, Lilly's conduct also materially and wantonly violated the

FDA's regulations and federal law governing off-label marketing and truthful labeling and promotion of prescription drugs. Lailly engaged in this profit-driven misconduct for the purpose of deceiving physicians with their false and fraudulent off-label marketing message to cause the submission of false claims for Zyprexa to the State of California.

I)

The FDA's Regulation of Prontotional Activities of Drug Manufacturers

53.

A prescription drug's product labeling contains the drug's indication. Drug

product labeling broadly defined by federal regulation, including 21 C.F.R. $ 202.1(k)(2), which provides that drug manufacturers' marketing and promotional materials for their drugs aimed at physicians, i.e., all brochures, handouts, detail aids, slide shows or other such promotional materials, are also defined a s "product labeling" and are stringently regulated as such. By law, representations made in any labeling material must be truthful, not misleading and represent a fair balance of the information presented. Any failure to - 11 COMPLAINT FOR DAMAGES

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fairly and accurately represent the required information about a prescription drug is considered misbranding and is a false and fraudulent statement as a matter of law. See 21 U.S.C. $5 33 1(a) and (b), 352(a), (f)and (n); 21 C.F.R. $ 201.57.
54.

Pharmaceutical promotional materials and presentations lacking in fair

balance or that are otherwise false or misleading, violate the Food Drug and Cosmetics Act, 21 U.S.C. $$ 301 et seq., and regulations promulgated hereunder. Such violations exist where promotional and marketing materials and presentations for an FDA approved drugs reference "off-label" uses or expressly or implicitly promote unapproved uses and dosing regimens for which the drug is not indicated or are otherwise false, misleading o r lacking in fair balance in the presentation of information about the drug being marketed or any competing drug. 55. "Off-label" prescribing of drugs occurs when a drug is used by a medical

professional beyond the drug's indication. This includes prescribing a drug for a condition not indicated on the label, treating the indicated condition at a different dose or frequency than specified in the label, or to treat a different patient population (e.g.treating a child with the drug when the drug is approved to treat adults).
56.

Lilly materially violated these clear-cut labeling and misbranding regulations

to illegally increase sales of its blockbuster drug in the off-label elderly market by and through its marketing and promotional efforts of its LTC sales force in direct-to-physician marketing. 57. Lilly, unable to control and bolster Zyprexa revenues by directly submitting

prescription drug reimbursement claims to Medicaid and Medicare, instead launched a campaign intended to increase Government-funded off-label purchases of Zyprexa by defrauding LTC physicians, pediatric physicians and primary care physicians ("PCPs") to prescribe Zyprexa. The natural, intended and foreseeable consequence of such unlawful, premeditated conduct caused physicians and pharmacists to submit claims to publiclyfunded health plans that were ineligible for reimbursement pursuant to these programs' regulations.
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58.

Each such claim Lilly knowingly caused to be submitted under these false

pretenses in derogation of the labeling and misbranding laws, and each false statement it made to get claims for Zyprexa paid, constitutes a false claim for which Lilly is accountable under the California False Claims Act.

2)

Federal Law Prohibits Off-Label Marketing To Protect the Health and Safety of Patients

59.

Off-label marketing by pharmaceutical companies is closely regulated by the

FDA and the law because of its inherent dangers. These regulations protect patients and consumers by insuring that drug companies d o not promote drugs for uses other than those found to be safe and effective by an ostensibly independent, scientific governmental body, the FDA.

60.

Under the Food and Drug laws, (1) a manufacturer may not introduce a drug

into interstate commerce with an intent that it be used for an off-label purpose (notably, however, L,illy's creation of a LTC sales division directly evidences Lilly introduced Zyprexa into interstate commerce with the specific intent that it be used for off-label purposes, i e , to treat vague cross-over symptoms in the elderly, as pleaded with specificity .. herein), and (2) a manufacturer illegally "misbrands" a drug if the drug's labeling describes intended uses for the drug that have not been approved by the FDA. 21 U.S.C. 61.

$3 331,352.

Physicians are not prohibited from prescribing an FDA-approved drug "off-

label"; however, pharmaceutical promotional activities and marketing materials and presentations are false or misleading in violation the Food Drug and Cosmetics Act and regulations promulgated hereunder if they advertise "off-label" uses of a drug, or expressly or implicitly promote unapproved uses and dosing regimens for which the drug is not indicated.

62.

When pharmaceutical companies illegally encourage off-label uses for their

drugs, the number of prescriptions rises, thereby causing Medicaid and other programs to pay out more for prescriptions that are not eligible for payment. Lilly intended for its "off-

I)

label" promotional campaign to improperly increase the submissions of off-label Zyprexa - 13 COMPLAINT FOR DAMAGES

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prescriptions, including such prescriptions reimbursed by the Medicare and Medicaid programs.
63.

Lilly's off-label marketing programs have been extremely successful,

leading to the submission of claims to the Medicare and Medicaid programs for medically unnecessary and imprudent prescriptions which otherwise would not have been paid by Medicare and Medicaid.
64.

Any claim submitted for a drug when the drug was prescribed for an off-

label use not only violates Medicare payment rules but also files a fraudulent claim under the False Claims Act. 31 U.S.C. $3802. Claims for Zyprexa prescriptions induced to be written and submitted by MedicaidIMedicare participating pharmacy benefits providers to the Government for reimbursement as a direct and foreseeable result of Lilly's illegal offlahel marketing campaign has caused the State of California to suffer substantial economic harm.

B.
65.

Zyprexa's Limited Indicated Uses In September of 1996, the FDA approved Zyprexa tablets for use in the

treatment of adults of schizophrenia at target doses of 10 mg. per day. In 2001, the Zyprexa tablets were approved for treatment of adults suffering from acute manic episodes associated with bipolar I disorder at dosages of up to 2 0 mg. per day. In July of 2003, Zyprexa tablets were approved for the short-term treatment of adults suffering from acute manic episodes associated with bipolar I disorder, in combination with lithium or Depakote (valproic acid), with a recommended doses of 10 to 20 mg. per day. In January of 2004, Zyprexa tablets were approved for long-term treatment of adults diagnosed with bipolar disorder in doses of up to 2 0 mg. per day.

66.

In 2001, Lilly launched ZYPREXA Zydis, an orally disintegrating tablet

form of Zyprexa. ZYPREXA Zydis was specifically identified as an "opportunity" in Lilly's 2001 LTC Business Plan. 67. ZYPREXA Zydis tablets were made available in 4 strengths: 5 mg, 10 mg,
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15 mg, and 2 0 mg. ZYPREXA Zydis has essentially the same efficacy and safety profile as

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regular ZYPREXA tablets, and is indicated by the FDA for the same conditions: schizophrenia, maintenance of treatment response in schizophrenia and acute mania associated with bipolar I disorder in patients experiencing a manic or mixed episode. 68. The purpose of the introduction of the new disintegrating tablet form of

Zyprexa was for "Convenient Administration." Because this Zyprexa tablet is formulated to easily dissolve within seconds of being placed in the patient's mouth, the drug was touted by Lilly a s an important additional option for treating elderly patients, who may have difficulty swallowing a regular tablet form. In addition, Lilly promoted Zydis as providing a convenient alternative to liquid formulations of other drugs, and because absorption is not affected by food, it can be taken without regard to meals or drinking liquids, although, if patients wanted to drink something along with the medication, they may, but it is not necessary.

69.

Lilly provided Plaintiff-Relator with training materials to assist in the

promotion of ZYPREXA Zydis in the LTC demographic.

1)
70.

Medical Compendia Limited Supported Uses of Zyprexa
lnformation and the

The HFS, the United States Pharmacopeia-Drug

DRUGDEX information system support the use of Zyprexa in adult (not geriatricj schizophrenic or bipolar patients only. 'The uses supported by the three compendia and the FDA approved labeling are collectively defined a s Zyprexa's "Medically Accepted Indications" in the Federal Medicaid Act, 42 U.S.C.A.

5

1396r-8. Neither the compendia

cited above nor the FDA-approved labeling supports any use of Zyprexa by the elderly, by children or for treatment of adults with depression, anxiety, ADD, ADHD, sleep disorders, anger management, mood enhancement or mood stabilization.

VIII. PLAINTIFF-RELATOR'S PERSONAL KNOWLEDGE OF LILLY'S SUCCESSFUL, NATIONAL OFF-LABEL ZYPREXA MARKETING AND PROMOTIONAL PRACTICES
71.

In or about February 2001, Lilly hired Plaintiff-Relator as a Long Term Care

(''LTCV), Specialty, Pharmaceutical Representative.
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72.

Plaintiff-Relator's hiring came on the heels of one of Lilly's expansions of

its LTC sales division. Since Lilly established the LTC sales division, which upon information and belief occurred simultaneously with the drug's launch in 1996, Lilly periodically expanded the LTC sales division.

73.

At the time Lilly hired Plaintiff-Relator, there were 160 LTC Zyprexa sales Initially,

representatives whose territories spanned the United States. See Exhibit "A."

there were only 15 LTC sales representatives. In August 1999 that number was expanded to 59. In March 2000, concomitant with Zyprexa gaining sales momentum in the LTC market, Lilly nearly tripled its LTC sales force to 160. Id. Lilly continued to increase the size of its LTC sales force thereafter.

74.

Lilly's stated purpose for expanding the LTC division was to, inter alia,

maximize Zyprexa sales to patients who receive their medications via a LTC pharmacy. Indeed, Lilly even disseminated materials to LTC sales representatives overtly referring to the "Golden Opportunity in LTC Care" and the data that supported the vast potential for Zyprexa sales in this off-label market.
75.

Lilly maintained a Zyprexa LTC sales division to fulfill one purpose - to

aggressively promote Zyprexa on behalf of Lilly to LTC facilities that care exclusively for the elderly, despite the Jack of any clinical trials or FDA approval for the use of Zyprexa in the elderly. Plaintiff-Relator gained personal knowledge of these facts during Lilly employment and has evidence substantiating these facts in the Lilly documents she retained from her Lilly employment, some of which are attached hereto as Exhibits. A s alleged herein and in the expanded discussion of Lilly and its off-label promotion of Zyprexa in section IX, Lilly trained its LTC sales force to maximize Zyprexa's LTC care revenues.

76.

For the duration of her employment with Lilly, Plaintiff-Relator's territory

encompassed the LTC market for parts of Northern California, which she covered alone, and the scope of her employment was to promote, market and generate increased revenues from sales of Zyprexa prescriptions written to elderly LTC nursing home residents. Plaintiff-Relator detailed the Stockton Territory within the Sacramento District which - 16COMPLAINT FOR DAMAGES

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encompassed Modesto, Stockton, Lodi, Mantica, Oakdale, Ripon and the surrounding regions.

77.

Plaintiff-Relator was required by Lilly to participate in and to graduate from

a rigorous 4 week training course at Lilly's corporate headquarters in Indianapolis, Indiana.

78.

There were 17 "new hire" LTC sales representative trainees from all over the

United States in Plaintiff-Relator's training class. The LTC sales division was uniform throughout the country. All LTC sales representatives received uniform training, they all received the same Zyprexa marketing materials (of course all geared to selling Zyprexa to elderly patients) and all LTC sales representatives market Zyprexa in the LTC demographic in essentially the same manner, no matter which state and which territory.

79.

The first two weeks of training focused on Zyprexa. The training topics

included an "introduction" to the drug and what it does, the fundamentals about Zyprexa's competitor drugs and training about why Zyprexa is comparatively superior. LTC trainees were also given studies about Zyprexa, Zyprexa's competitors, Zyprexa's effectiveness compared to placebo and/or other atypicals and other similar studies that trainees were required to memorize. The purpose of memorizing these studies was for the Lilly LTC trainees to cite to and explain in detail these Zyprexa-supporting studies during sales calls on LTC physicians. Plaintiff-Relator was given Lilly training materials in connection with her training and was continuously tested throughout her training to monitor her progress.

80.

The second two weeks of the training period focused entirely on how to sell

Zyprexa to elderly patients in LTC skilled nursing facilities. In reality, this aspect of Lilly's training was a study in how to successfully market Zyprexa and induce physicians to prescribe Zyprexa to elderly patients to treat symptoms such as agitation, irritability, dementia and the like, all of which constitutes illegal off-label marketing.

81.

Among other things, Plaintiff-Relator received extensive training from Lilly

corporate training officials on subjects such as how to talk about the drug's efficacy in the treatment of Alzheimer's patients, how to induce physicians to ask "unsolicited'' questions about Zyprexa off-label uses and to focus the marketing message on symptoms and
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I./

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behaviors and Zyprexa's superior efficacy in "Restoring Calm," and that "nothing calms like Zyprexa." The sales materials discussed below carry forward this "Calming" selling message.

82.

Lilly reinforced this training by providing mandatory role playing sessions

designed to replicate what the LTC sales person would experience in the field when calling on LTC physicians.
83.

Among other things, Lilly LTC salespersons including Plaintiff-Relator,

engaged in role playing exercises that emulated physician sales calls. Lilly made it a prerequisite to "graduation" from Lilly's initial rigorous 4 month training for each LTC sales representative to receive a passing grade on a videotaped role-playing session designed to simulate "real life" marketing calls with LTC physicians.
84.

Since Zyprexa has not been approved by the FDA to treat the elderly, Lilly

trained its LTC sales persons (through such exercises as role playing) to discuss Zyprexa's efficacy and safety in treating generic symptoms known by Lilly to be commonplace in elderly LTC patients. The primary symptoms LTC sales representatives were trained to focus on were hostility and aggression, and to highlight Zyprexa as the drug of choice to "restore calm" in such agitated patients.
85.

Notably, Plaintiff-Relator received scant training on schizophrenia and bi-

polar disorders during the four weeks if her comprehensive LTC sales training. Instead, the majority of the training involved geriatric data and information. Lilly's focus on geriatrics over Zyprexa's indicated uses evidences Lilly's illegitimate purpose in maintaining a LTC sales division and reveals its focus and intent to achieve blockbuster off-label sales of Zyprexa. The calculated sales and marketing tactics demonstrate Lilly's conscious

aforethought to off-label marketing.

86.

Plaintiff-Relator, having worked in the pharmaceutical sales prior to Lilly,

vocally questioned her Lilly trainers about the legality of the marketing practices being taught, specifically, she questioned the off-label nature of the Zyprexa marketing campaign promoting Zyprexa's safety and superior efficacy for geriatrics to LTC physicians, nursing - 18 COMPLAINT FOR DAMAGES

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home employees and LTC pharmacies. Plaintiff-Relator was assured that by following Lilly's training on how to deliver the LTC Zyprexa message, off-label regulations would not be violated.
87.

The role-playing seminars were not limited to L T C training. Rather,

mandatory role-playing occurred at every Lilly sales meeting so sales representatives could "brush up" and hone their skills in delivering the misleading, deceptive and illegal Zyprexa off-label marketing tactics. 88. In addition t o communicating such practices during frequent regional and

district sales conferences, Lilly engrained its off-label marketing message during once or twice annual national sales meetings. During national sales meetings, specific gatherings, seminars, and training sessions were held solely for the Lilly LTC sales representatives. 89. As is detailed below, once Plaintiff-Relator graduated from training, she was

continuously given Zyprexa marketing materials, such as studies, LTC implementation guides and "detail aids" tailored to selling Zyprexa in the geriatric market. Lilly's Zyprexa sales materials were the creation of the Zyprexa Brand Team, the division within Lilly responsible for developing the marketing and promotional selling message for Zyprexa in the United States.

90.

Plaintiff-Relator also occasionally received promotional materials distributed

by her Lilly manager, Dan Tubridy ("Tubridy"). One egregious example of such materials was a one-page sheet containing 2 form letters (one for Zyprexa and one for Zyprexa Zydis) with "fill in the blanks" to personalize the message to client-target physician and his or her geriatric patients Zyprexa doses and times of administration. See Exhibit "B." The letter's purpose was to suggest to the physician that his or her patients' Zyprexa dosage should be increased to reduce "nursing time and effort." Tubridy instructed Plaintiff-Relator to pass out this form letter to her target-physicians to induce an increase in Zyprexa dosage, which translated directly to increased Zyprexa sales revenues, by promoting Zyprexa7sknown side effect of somnolence. Promotion of Zyprexa as a chemical restraint for difficult, agitated elderly patients was not only illegal unsolicited off-label marketing, but also a wanton - 19COMPLAINT FOR DAMAGES

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derogation of patients' fundamental human rights.
91.

Lilly's myopic focus and goal of driving Zyprexa off-label sales is

evidenced by the convoluted manner in which LTC sales representatives' performance was evaluated. Job performance hinged entirely upon each LTC representatives total sales
revenues generated by LTC Zyprexa purchases in her Northern California territory. Lilly's

tunnel vision focus on salespersons profits, rather than number of prescriptions written evidences the avaricious nature of Lilly 's illegal marketing pursuit, as it shows salespersons were expected not only to increase market share, but to increase dosages and/or frequency to rive up profits. 92. Plaintiff-Relator was continuously employed a s a Lilly LTC sales

representative for three years until on or about June 2003. At that time, she voluntarily resigned from her employment to accept a higher-paying pharmaceutical sales representative position with another pharmaceutical company. Plaintiff-Relator began pursing a career change while still a Lilly employee after Lilly executives rebuffed her attempts to rectify the unethical and illegal Zyprexa sales practices implemented and mandated by her Lilly Supervisor, Dan Tubridy. 93. Indeed, prior to leaving Lilly's employ, Plaintiff-Relator submitted to Lilly

corporate a 3 page summary documenting all of Tubridy's illegal and unethical conduct. Exhibit "C." Lilly's rebuffed Plaintiff-Relator's attempt to right the wrongs of her

manager, simply giving Tubridy a meaningless "warning," which was tantamount to a corporate endorsement of Tubridy's illegal, but successful Zyprexa sales methods. Soon thereafter, Plaintiff-Relator began seeking employment with another pharmaceutical company.

IX.

ADDITIONAL FACTUAL BASIS OF LILLY'S ILLEGAL OFF-LABEL MARKETING OF ZYPREXA FOR ELDERLY OFF-LABEL USES AND TO PRIMARY CARE PHYSICIANS FOR OFF-LABEL USE TO TREAT NONSCHIZOPHRENIC OR BIPOLAR ADULTS
94.
As alleged supra in $ VII B, Zyprexa is indicated to treat an exceptionally

small subset of the United States population. Indeed, less than 7% of the United States' - 20 COMPLAINT FOR DAMAGES

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adult population has been diagnosed with one of the rare mental illness for which Zyprexa is indicated for the treatment of symptoms relating thereto - schizophrenia and bipolar disorder.

95.

It is not by stroke of luck that Zyprexa has been Lilly's largest selling drug

for a number of years and has generated astounding blockbuster revenues for the drug company. For years, Zyprexa generated several billions of dollars of revenue for the company and was among the top ten best selling drugs in the world. In 2003, Zyprexa sales rose to $4.4 billion and assumed the rank of world's fifth best selling drug.

96.

Rather, from the outset, Lilly recognized the promotion of Zyprexa's not

medically accepted indications and not medically necessary uses as the key to Zyprexa's blockbuster success, i.e., promoting the use of Zyprexa to treat off-label demographics who present with symptoms akin to those exhibited by patients diagnosed with those exceedingly rare mental illnesses - depression, sleeplessness, agitation: 1) elderly LTC residents, 2) depressed and distracted adults who are not diagnosed with schizophrenia or bipolar disorder and 3) children with conditions such a s ADHD, autism, mood disorders and disruptive children. Lilly devised this game plan despite its awareness of numerous serious treatment emergent side effects caused by Zyprexa including diabetes, hyperglycemia, extraordinary weight gain and metabolic syndrome, to name a few.
97.

Indeed, Lilly funded calculated studies with methodologies intended to

contrive positive clinical data about Zyprexa to ensure Zyprexa's numerous, dangerous and even deadly side effects were kept from public purview.

98.

Lilly succeeded. Zyprexa's incredible revenues and sales ranking directly

stems from the drug's dangerous overuse off-label that have not been found by the FDA or medical compendia to be safe or effective. This dangerous overuse is directly attributable to Lilly's illegal off-label promotional tactics.

99.

Upon information and belief, based upon the foregoing, Lilly began planning

its national, aggressive off-label marketing campaign for Zyprexa even before Zyprexa had received FDA approval. In this regard, Lilly's devised a strategy prior to Zyprexa's launch -21 COMPLAINT FOR DAMAGES

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to market the drug not only for use with elderly and children, but also for a constellation of broad symptoms in the broad realm of mood and thought disbrders, a strategy that gave rise to an ongoing pattern of false and misleading conduct.
100.

This conduct directly and proximately resulted in both the submissions of

claims for not medically accepted indications and not medically necessary uses of Zyprexa to Medicaid, Medicare, VA and CHAMPUSITricare programs in California and throughout the country as well as adverse health effects among participants of those programs.

101.

Through this planning Lilly funded clinical studies for Zyprexa, for on and

off-label uses, which ultimately Lilly planned to be used by its sales representatives to promote Zyprexa. Indeed, Plajntiff-Relator was given such studies by Lilly with the expectation that she learn the details of the studies backwards and forwards and use the contrived results of the studies in promoting Zyprexa off-label.

102.

Lilly furthered its illegal avaricious Zyprexa business plan by creating a

deceptive and misleading marketing campaign to create a LTC market for Zyprexa, among other off-label markets. Lilly falsely touted Zyprexa's superior efficacy in treating the generic mood and behavioral symptoms of schizophrenia and bipolar disorder; symptoms that Lilly knew were also prolific in the elderly population.

103.

The purpose of the deceptive scheme was to create the misimpression that

geriatric patients presenting with a myriad of symptoms that did not fit into a precise diagnostic category were Zyprexa candidates, thereby creating a broad, ill-defined market for Zyprexa in the elderly demographic.

104.

Lilly tweaked the message slightly for its other sales divisions, such as its

primary care physician sales force, to achieve the same impact - to create the misimpression that adult and pediatric patients presenting with a myriad of symptoms that did not fit into a precise diagnostic category would benefit from being prescribed Zyprexa in increasing doses, thereby creating an across the board off-label for Zyprexa among patients who relied upon Medicaid, Medicare, the V A andlor CHAMPUSlTricare to fund their necessary prescription drug needs.
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A.

Lilly's Calculated Training Of Zyprexa Sales Representatives to Successfully Market Zyprexa Off-Label to, inter alia,
MedicaidMedicare Beneficiaries

105.

Lilly's scheme was highly successful. Data shows that well over half of all

dollars spent on Zyprexa is spent on non-medically accepted or not medically necessary uses. Moreover, Zyprexa has been prescribed to more than 12 million people worldwide since the atypical antipsychotic's launch in 1996. Crucial to this Blockbuster success was Lilly's aggressive marketing of Zyprexa for elderly use through its LTC sales division, which consisted chiefly of exaggerating the drug's uses, while concealing its lifethreatening side effects. 106. Lilly created complicated marketing structures that appeared independent

from their proprietary of promotion forces.
107.

Lilly sales representatives were expected in the course and scope of their

employment to identify specific doctors (i.e. physicians who were already prescribing large volumes of Zyprexa or physicians whose antipsychotic "business" Lilly wanted to obtain) to recruit and communicate Lilly's interest in funding research opportunities and clinical trials at their institutions. Doctors who were willing to speak favorably about Zyprexa often were given substantial funds by Lilly in the form of research grants, many unrestricted. These funds were in reality kickback paid to induce the physicians' use of Zyprexa.
108.

Lilly engaged in this duplicitous conduct to create the false perception that

respected physicians were using and investigating Zyprexa's efficacy in non-medically accepted and not medically necessary uses on their own initiative, and not a s a result of Lilly's marketing activities. And in addition to providing free travel to resorts, free lodging and free meals, Lilly also paid these physicians to give talk segment medical education seminars, advisory boards, consultants meetings, speakers bureaus and similar events that favorably discussed not medically accepted and not medically necessary uses of Zyprexa.
111

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1)

Promotion to the Elderly

109.

The generic symptoms Lilly unlawfully promoted Zyprexa to treat mimicked

those of dementia and/or Alzheimer's, including agitation, anxiety, and insomnia. By marketing the drug for the treatment of symptoms for which Zyprexa was not approved, Lilly violated strict FDA labeling regulations detailed infra. 110. Lilly encouraged use of Zyprexa in the elderly demographic to treat multiple

symptoms that might be categorized as relating to dementia and/or Alzheimer's. T o assist in these efforts, Lilly created patient profile detail aids whose focus was on "behavior treatment" such a s agitation, suspiciousness, depressive mood. anxiety, and lack of concentration. By focusing on symptoms rather than the diagnoses of schizophrenia or bipolar disorder, Lilly intended to overcome Zyprexa's lack of any FDA approved market for Zyprexa in the LTC demographic.
1 1 1.

Lilly propagated the intentionally misleading message that Zyprexa was

indicated for the treatment of dementia by directing its sales force to focus on behavioral and cognitive symptoms such as anxiety, depression, agitation during physician sales calls. 112. Among the most common, treatment-emergent adverse side effects of

Zyprexa and the other atypical antipsychotics is somnolence. Somnolence is defined as sleepiness, the state of feeling drowsy, ready to fall asleep. Within its drug class, Zyprexa is the most heavily sedating. 113. One approach Lilly devised for its LTC sales representatives was to market

Zyprexa's somnolence side effects as method to reduce patient care hours by essentially chemically restraining demanding elderly patients.
114.

Indeed, Lilly preyed upon the fact that providing care to elderly LTC

residents who typically exhibit combative behavior and aggression is considerably stressful, frustrating and time consuming.
115.

By way of example, Plaintiff-Relator and other Lilly L T C sales

representatives were given studies by Lilly to distribute to LTC staff espousing ostensibly clinical evidence that elderly patients prescribed Zyprexa required fewer skilled nursing - 24 COMPLAINT FOR DAMAGES

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staff hours than patients prescribed other competing medications. One such study was Olanzapine Treatment of Psychotic and Behavioral Symptoms in Patients With Alzheimer f Disease in Nursing Care Facilities, Archives o General Psychiatry, Vol. 57, pg. 968 (Oct.

2000) See Exhibit "N." Plaintiff-Relator and other Lilly LTC sales representatives were
told to point directly to pg. W1 of this study and read: "A statistically significant reduction in caregiver distress, measured by the sum of the Occupational Disruptiveness scores for AgitationIAggression, Hallucinations, and Delusions (Core Disruptiveness) was seen for patients treated with 5 mgld of olanzapine ... Caregivers of patients treated with 5 mg/d of olanzapine also had similar reductions in Occupational Disruptiveness associated with Anxiety, Appetite and Eating Disorders, Delusions, DepressionIDysphoria, and Hallucinations items."

116.

LilPy LTC sales representatives were taught to create "action" in nursing

homes by marketing Zyprexa's "calming" effect. In truth, this was Lilly's thinly-veiled marketing of Zyprexa as an effective chemical restraint for demanding, vulnerable, and needy patients. 117. In addition, Plaintiff-Relator's manager disseminated a form letter to the

representatives under his supervision and control that touted Zyprexa as providing superior efficacy and safety when compared to placebo and significantly reduced caregiver burden at a dose of 5 mgs daily. See Exhibit "B." This statement was "supported" by a footnote citing a study that ostensibly supported this mendacious marketing of Zyprexa as a chemical restraint. Id. 118. The form letter also expressed the medical opinion that the 5 mg. dose of

Zyprexa should be administered at 5 pm. Id. This was a Lilly-trained "5 at 5" slogan which translated essentially referred to give your patients 5 mg. of Zyprexa at 5 pm and they will sleep through the night eliminating the disruptive late night conduct demanding of caregiver time. 119. Atypical antipsychotics are powerful medications, laden with serious

treatment-emergent side effects. Zyprexa is a dangerous drug even when prescribed for onlabel use. It is even more dangerous for the elderly. Zyprexa and the other atypical
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antipsychotics have not received FDA-approval to treat the elderly because of atypicals' serious risk of harm and the lack of scientific evidence of its safety and efficacy in this population.
120.

On April 11, 2005, the FDA issued a public health advisory to alert health

care providers, patients, and patient caregivers of its determination based upon clinical studies that using Zyprexa or the other atypicals to treat behavioral disorders in elderly patients with dementia is associated with increased mortality. The FDA's examination of the specific causes of these deaths revealed that most were either due to heart related events (e.g., heart failure, sudden death) or infections (mostly pneumonia).

121.

Accordingly, the FDA required Lilly to amend Zyprexa's label to include a

"black box warning" of this deadly side effect. A 'black box' designation is an FDArecommended/mandated warning based upon clinical research studies, for certain drugs that may cause serious and potentially life-threatening side effects. The FDA requires that a black box warning be placed on the labeling or literature of a prescription drug, or in literature describing it. It is the strongest warning the FDA requires.

122.

Because of Lilly's promotion of Zyprexa's somnolence side effect as an

attribute of the drug, patients were intentionally medicated with incapacitat~ng antipsychotic agents such as Zyprexa to control patient behavior, "restore calm" and reduce the time needed to be spent to treat patients, especially the those patients who required burdensome, time intensive care, as well as those patients who demonstrated "oppositional" and "defiant" behavior.

123.

The use of atypical and typical antipsychotic drugs to control the behavior of

elderly nursing home residents who are not psychotic constitutes an unlawful chemical

restraint. Lilly's unlawful and unethical promotion of the use Zyprexa, off-label, as a chemical restraint resulted in patients being restrained in a zombie-like state, unable to
complain or object. Prescriptions were medically unnecessary 124. The State of California's healthcare programs would not have paid

prescription drug reimbursement claims caused to be submitted by Lilly's mendacious and - 26 COMPLAINT FOR DAMAGES

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unlawful marketing of Zyprexa's somnolence side effect had it known the truth.
125.

A s part of the Zyprexa sales campaign, Lilly disseminated Zyprexa LTC Lilly created a LTC

Implementation Guides to its L T C sales representatives.

Implementation guide specifically to roll out each new year's version of Lilly's LTC patient profile. See eg Exhibit "E."

126.

Lilly's LTC detail aid was a L T C stereotypical patient - an elderly patient

representing the agitated, hostile geriatric patients LTC physicians treat everyday. "Rose" was the detail piece used by LTC sales representatives to represent the angry and hostile elderly patient complaining of symptoms such as anxiousness, irritability, mood swings, and disturbed sleep. See e.g. Exhibit "D."

127.

T h e "Rose Jackson" ("Rose") detail aid contained only conspicuously

printed wording like "Agitation," "Depressive Symptoms," "Aggression," Irritability," and "Sleeplessness" calculated to imply that Zyprexa was indicated for the treatment of such

symptoms. Id. The top of the front page conveyed the message "Helping you bring
dignity to patients' lives." Id. Nowhere on this Rose detail aid did Lilly explicitly disclose that Zyprexa's FDA-approval was limited to the treatment symptoms of schizophrenia and bipolar mania and not the other generic symptoms highlighted in print on the detail aid (i.e. sleeplessness, irritability, depressive symptoms). Id.
128.

The detail piece featured a large color picture of "Rose," an elderly woman

composed to appear agitated and combative. Id. Lilly's strategy goal for the Rose detail piece was to "encourage doctors to try Zyprexa in patients similar to the one we profile, Rose Jackson. Jn this way, doctors can see for themselves that Zyprexa stabilizes

symptoms and behaviors safely."
129.

"Rose" was designed to personalize the sales representative's promotion of

Zyprexa as the wonder drug to "calm" difficult patients and to reduce patient treatment time. Plaintiff-Relator was instructed to show this image to clients to reinforce the marketing message that Zyprexa can treat his or her angry, agitated and difficult patients. 130. Lilly even disseminated along with the Rose detail aid the marketing - 27 COMPLAINT FOR DAMAGES

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message the sales representative was expected to learn verbatim and then deliver during LTC physician sales calls, which Plaintiff-Relator still recalls to this day. Lilly trained its sales representatives t o show the Rose detail aid to physicians and deliver a verbatim sales pitch probe recommending that the physician's patients like Rose are indicated for treatment with Zyprexa and would benefit from commencing a Zyprexa regimen. By way of example, Plaintiff-Relator and other sales representatives would ask leading questions to physicians relayed in the LTC Implementation Guide, such as, "Doctor, does it make sense to use Zyprexa as a first choice for a patient like Rose, since Zyprexa helps to safely stabilize symptoms and behaviors such a s agitation, anxiety, hostility, delusions, and resistance to care?" See Exhibit "E."

131.

Future iterations of the Zyprexa LTC Implementation Guides similarly

helped deliver the message that Zyprexa should be prescribed to treat moods, behaviors and symptoms. By way of example, in the January 2003 "Rose" Detail Aid, L;illy describes to sales representatives, including Plaintiff-Relator, that on the detail aid's cover, "there is also the addition of a couple more mood symptoms, which is to emphasize our unique ability in treating mood." See Exhibit "F."

132.

When detailing the Zyprexa 2003 L T C Rose detail piece, sales

representatives, including Plaintiff-Relator, were instructed to deliver the message that, "Because Zyprexa treats both symptoms of elevated mood and psychosis, it helps you restore calm to the resident, the staff and even the other residents- the environment will be less disruptive since the resident will be calm instead of yelling, 'Help me-help me."'

133.

Further, on the cover of later versions of the Zyprexa LTC Rose detail piece,

along with the symptoms and behaviors, Lilly finally incorporated the language, "ZYPREXA is indicated for the treatment o f ' and then lists the two approved indications for use for Zyprexa, schizophrenia and acute bipolar mania. Exhibit "G."

134.

Among the other duplicitous sales tactics implemented by Lilly at the

corporate level involved serious violations of the confidentiality of protected health information safeguarded by the HIPAA regulations as well as breaches of the doctor-patient - 28 COMPLAINT FOR DAMAGES

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privilege.
135.

Although Lilly LTC salespersons were evaluated on total Zyprexa sales

revenues rendering prescribing physicians, the LTC pharmacies, Lilly LTC sales representatives' relationships with LTC pharmacies were nonetheless pivotal in successfully promoting Zyprexa within the LTC context.
136.

Indeed, LTC pharmacies arrange for and bill the State of California' for the

drugs prescribed by physicians to LTC facility residents. LTC pharmacies are known as 'closed-door' pharmacies. Closed-door pharmacies are full-service pharmacies, but which exclusively provide prescription drug delivery services to residents of LTC facilities.

137. LTC pharmacies regularly bill Government-funded healthcare plans such as
Medicaid for medications prescribed by medical professionals working onsite at the nursing homes.
138.

When a patient in a nursing home requires a prescr~ptionmedication,

physicians give written or verbal prescription orders for their patients to nurses. The nurses transmit the prescription orders verbally or by facsimile to the responsible LTC pharmacy clerical data entry personnel to be entered into the LTC pharmacy's computerized order entry system.
139.

Once a physician's prescription order is processed in the LTC pharmacy's

order entry system, a pharmacist fills the prescription based on the physician's request and the medication is then shipped to LTC skilled nursing home facility where the patient resides.
140.

Once the LTC has filled and shipped a prescription, the LTC pharmacy

prepares a claim for submission to the Government, including the State of California, seeking reimbursement for the cost of the prescription drug.
141.

Lilly knew that the vast majority of elderly LTC residents rely upon, inter

alia,Medicare and Medicaid to fund in whole or in part their prescription drug costs.
142.

Since LTC pharmacies play an integral role in the delivery of prescription
- 29 -

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which were targeted for Zyprexa off-label marketing, albeit less frequently than the physicians who are writing the prescriptions. 143. T o identify and target the most influential doctors, Lilly encouraged LTC

representatives to develop personal relationships with the LTC pharmacies to gain access to the pharmacies' local prescribing data.
144.

In addition, LTC pharmacies provide consultant pharmacist services to the

LTC facilities they service. Such consultant pharmacists work closely with physicians writing orders in LTC facilities to purported "educate" LTC physicians about prescription alternatives. 145. Because of the significant influence LTC pharmacies play in the prescribing

decisions of LTC physicians, Plaintiff-Relator made once monthly sales calls to LTC pharmacies in her territory to ensure the pharmacies encouraged the use of Zyprexa in the facilities they service. Plaintiff-Relator specifically recalls making sales calls to LTC pharmacies to combat financially-incentivizing rebate agreements the LTC pharmacies had negotiated with Janssen, the manufacturer of Zyprexa's competitor Risperdal. Such rebate agreements made it profitable for the LTC pharmacy t o use its consulting pharmacists power and influence to push LTC physicians to use Risperdal over Zyprexa. 146. Plaintiff-Relator and the LTC sales division generally were also instructed

and trained on how to obtain Drug Utilization reports, also known by the acronym "DURs," from the LTC skilled nursing home executive staff. See Exhibit "G." 147. A "Drug Utilization Report" is a report delineating protected health

information detailing which patients were taking which drugs and which physician was prescribing those drugs. 148. Lilly enforced this directive by tracking LTC sales representatives' success

rates in obtaining the coveted DUR reports. See e.g. Exhibit "H." 149. T o keep the LTC sales representatives across the nation abreast of Zyprexa

LTC sales as well as successful LTC promotional tactics, Lilly disseminated a LTC Best Practices Newsletter 4 times a year. Id.
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150.

The LTC Best Practices Newsletter is packed with evidence and admissions

of Lilly's unlawful LTC off-label marketing campaign. Id. It openly addresses Lilly's improper expectation that Lilly LTC sales representatives gain access to protected confidential patient information (i-e. DURs), instructs the sales representative to do rounds with the "NH [nursing home] prescriber" - a highly offensive invasion upon the doctor patient privilege, and contains messages from Lilly executives such a s Grady Grant and Tom Olinski, Lilly National Sales Directors and Mike Murray - the LTC Western Division Sales Director and identifies L T C top sales performers across the nation to "SELL ZYPREXA!" The Newsletter also features a "Coaches Comer," which provides tips on maximizing L T C sales of Zyprexa. In the 2003 Winter edition of the Newsletter, the Coaches Corner featured an article by "Wayne Mielke, [the] "Long Term Care Coaching Champ of 2001, on the importance of DUR ATTAINMENT." Id. 151. Plaintiff-Relator received the quarterly Lilly LTC Best Practices Newsletter

in the course and scope of her Lilly employment. 152. Lilly paid honoraria o r speaker fees as part of their overall off label Zyprexa

marketing scheme. The payment of and acceptance of the financial incentives in exchange for prescriptions violated the federal Anti-Kickback Statute. See § XI. 153. Lilly management approved huge speaker fee budgets as a means to disguise

large payments to physicians who were willing to prescribe Zyprexa off label. Lilly established large budgets for each LTC representative to induce physicians to write off label. The speaking fees were typically $1500 for a "lunch and learn." 154. One method employed by Lilly to conceal kickback payments under the

guise of legitimacy was the creation of a "speaker" program. Lilly even established an annual budget for LTC sales representatives to "invest" in speaker feesthonoraria as well as an annual entertainment budget to impress and attract physicians' business. 155. Physicians were even "groomed" by Lilly to be speakers by attending all-

expense paid speaking seminars in resort-like atmospheres. These seminars were in truth designed to market Zyprexa, not to provide speaker training. For large volume prescribers, - 31 COMPLAINT FOR DAMAGES

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regardless of whether they exhibited a shred of public speaking acumen, after the seminar such physicians were retained and paid handsomely to speak about Zyprexa.

156.

The speaking engagements were frequently a mere sham, indeed, Plaintiff-

Relator has personal knowledge that such Lilly-paid speakers were even paid to give pointless presentations to their colleagues at the healthcare facility with which they were affiliated.
157.

Such thinly-veiled kickback payments were made with the intent that in

return, the paid physician would prescribe Zyprexa for symptoms and illnesses that were unrelated to schizophrenia and bipolar disorder to the frail elderly population. Lilly LTC sales representatives used their improper access to DURs to identify physicians to solicit to enter into unlawful financial relationships.

158.

Plaintiff-Relator has personal knowledge that Lilly established similar illegal

referral relationships with health care providers throughout the United States.
159.

Sales representatives, including Plaintiff-Relator, were instructed by Lilly on

implementing "Peer-to-Peer Programs" intended on having pald physicians lecture on designated topics, including off-label topics. Typically, sales representatives, including Plaintiff-Relator, would organize continuing medical educatiorl ("CME") programs and offer these programs to their physician customers.

160.

By way of example, one such program was "FDA Regulated Programs

(Promotional)" wherein the sales representative selects a program topic and a physician under contract with Lilly Lecture Bureau. If the chosen speaker is not under contract, he or she must sign a contract to speak about Lilly's products. See Exhibit "I." representative submits a speaker payment request to Lilly's Lecture Bureau. The Sales

161.

T o complete the payment process to physicians, Plaintiff-Relator would

contact the Lilly Lecture Bureau and the Lilly Lecture Bureau arranged for the check to be sent, typically directly to the lecturing physician. See Exhibit "J."

162.

Lilly's Peer to Peer Programs Implementation Guides stresses that the See Exhibit "K."

"program time should be balances equally with entertainment time." - 32 COMPLAINT FOR DAMAGES

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Further, the sales representative was instructed to pre-set menus and "pre-select wine list and order group appetizers." Id.

163.

Another example of a Lilly Peer t o Peer Program is the lndependent

Scientific Exchange (Non promotional Program). This program is ostensibly initiated by the medical institution. The institution contacts the sales representative or Lilly Lecture Bureau directly. Then, Lilly's Lecture Bureau sends the specific institution their "grant request letter." See Exhibit "L." T h e grant request may contain a request for an

honorarium to speak, as well as a request for food, beverages, travel and other expenses. LLB sends grant checks to the institution or physician within 7 days after completion of the program, and sometimes prior to the program. Id.

164.

Further, by way of example, sales representatives could also initiate

"Customer Entertainment" as a Peer to Peer Program. The sales representative invites customer physicians to specific events (i.e., sporting events, concerts, theater or dinners). If the incentive of choice was a dinner, the sales representatives were instructed to select the best items on the menu and select a red and white wine for the table." See Exhibit "M "

165.

Lilly's routine practice of paying kickbacks was intended to and did amplify

physicians' off-label overutilization of Zyprexa for their patients.

166.

Ljlly knew that the payments constituted kickbacks in reckless disregard of

the law. Lilly was also acutely aware that the safe harbors established by the HHS did not cover the exorbitant payments being made. Lilly intended these payments to encourage Zyprexa overutilization in off-label demographics.

2) 167.

Illegal Off-Lubel Marketing to Primary Care Physicians

Lilly's national off-label Zyprexa marketing campaign targeting primary

care physicians ("PCPs") was designed to make Zyprexa part of the everyday prescribing habits of not only LTC physicians treating the elderly, but also PCPs in their office practices.

168.

In order to grow Zyprexa market share sales and surpass competing

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for off-label purposes beyond LTC, Lilly concomitantly launched a marketing campaign targeting PCPs. The campaign was designed to "educate" PCPs about which patients they regularly see in their practices who present with symptoms treatable with Zyprexa, i.e., albeit off-label use. Lilly's goal being to make Zyprexa the cornerstone of PCPs everyday prescribing habits.

169.

Similar to the LTC sales message, Lilly's PCP off-label Zyprexa

promotional campaign focused on symptoms, not diagnoses. T o achieve this goal, Lilly PCP sales representatives were trained to deliver a Zyprexa marketing message that centered on symptoms associated with mood, thought, and behavioral disturbances.
170.

Lilly targeted PCPs because of the fundamental role PCPs play in patient

care and in prescribing drugs to treat a multitude of symptoms, thereby maximize profits and growing market share. in addition, Lilly marketed Zyprexa to primary care physicians for non-indicated uses, because Lilly's marketing studies demonstrated that PCPs generally had less awareness of Lilly's indicated uses and treatment-emergent side effects. Lilly sales material encouraged representatives to promote Zyprexa as a "safe, gentle psychotropic" suitable for people with mood-related symptoms.
171.

Lilly P C P sales representatives were trained and instructed to market

Zyprexa to PCPs by suggesting that there were a plethora of patients in the physician's practice exhibiting "irritability," "disruptive behavior," "poor sleep," "elevated mood," "depressed mood," "anxiety" and "irregular sleep patterns" and that Zyprexa is a safe and efficacious drug to treat such symptoms.
172.

Just as it did for the LTC sales force, Lilly created several promotional

caricatures tailored to market Zyprexa to PCPs. The primary PCP caricature PlaintiffRelator became familiar with is "Donna." "Donna" is a mother of two children in her early 30's who is distracted and depressed and these symptoms are interfering with her daily life. Perhaps Donna has been prescribed drugs that treat depression. Lilly sales representatives were trained and instructed to encourage PCPs with "Donnas" in their practice to prescribe Zyprexa, although she has not been diagnosed with either bipolar mania or schizophrenia. - 34 COMPLAINT FOR DAMAGES

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173.

Lilly developed Donna knowing that millions of people fit Donna's broadly

defined profile and who are not psychotic, schizophrenic, or bipolar. This way, Lilly could accomplish its primary goal t o drive off-label sales of Zyprexa by causing as many unsuspecting adult patients on Zyprexa as possible. 174. Plaintiff-Relator has personal knowledge that LiHy's promotion of Zyprexa

to PCPs, including her presence in PCP physicians' offices during a Lilly PCP sales representative's sales call.
175.

Each LTC sales representative's territory "overlapped" with a Zyprexa PCP

sales representative. Lilly expected its LTC representatives to coordinate with his or her overlap. 176. Accordingly, Plaintiff-Relator periodically made joint sales calls to PCPs

who also treated LTC residents with her "overlap." During these joint Zyprexa sales calls, Plaintiff-Relator witnessed her Lilly PCP overlap deliver the Zyprexa off-label PCP marketing message designed to promote Zyprexa's superior efficacy and safety for treating adult patients who presented with symptoms relating to mood, anxiety, and depression, while omitting that Zyprexa is not indicated for the treatment of such symptoms not attendant to the diagnosis of bipolar disorder or schizophrenia. 177. Plaintiff-Relator witnessed the PCP overlap use, wherein the PCP sales

representatives referred and relied upon the Donna profile to promote Zyprexa off-label for depression and mood disorders. At no time did the PCP sales representative initiate any discussion about Zyprexa's lack of indication for the treatment of such symptoms in patients not diagnosed with schizophrenia or bi-polar disorder. 178. Lilly's efforts to promote Zyprexa for use as a general mood stabilizer in the

treatment of depression have resulted in billions of dollars of revenue for the company.
///

/I/
/I/

I//
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X.

LILLY CAUSED THE SUBMISSION OF FALSE CLAIMS FOR ZYPREXA REIMBURSEMENT TO BE SUBMITTED BY LONG TERM CARE PHARMACIES A.
179.

Zyprexa Prescribed Off-label to LTC Residents Was Ineligible for Reimbursement by the Medicaid Program
Prior to the enactment of the Medicare Part D program, Medicaid purchased

an estimated 80-90% of atypical antipsychotic prescriptions. Of the top 3 0 drugs by total US revenue, Zyprexa is the most expensive. As detailed herein, the FDA defines off-label use as indications, dosage, form, dose regimen, population or other use parameter not mentioned in the approved labeling.

180. Because prescriptions for off-label uses generally are not eligible for
reimbursement, under Medicaid and Medicare regulations, submission of a claim for reimbursement for a drug prescribed off-label constitutes a false claim for the purposes of the State of California's False Claims Act. While it is a pharmacy, by virtue of the reimbursement system, which unwittingly submits the false prescription drug claim, the person or persons who knowingly cause(s) such a claim to be presented to the State of California, including the State of California, is liable under the law. Here, Lilly's California False Claims Act violations arise from its successful attempts to induce LTC pharmacies to unwittingly defraud the State of California. 181. Lilly knew that medically unnecessary, off-label Zyprexa prescriptions were

ineligible for Medicaid reimbursement and that its activities would, in fact, cause numerous ineligible prescriptions t o be submitted to Medicaid and Medicare by the LTC pharmacies which arranged for pharmaceutical benefits to LTC patients. 182. The unwitting participation of the LTC pharmacies in the submission of

false claims was not only foreseeable; it was an intended consequence of Lilly's scheme of fraud.

183.

Absent Lilly's intentional, illegal off-label marketing in the LTC

demographic, and its unlawful financial relationships with doctors, Zyprexa would not have been prescribed off-label. Lilly's off-label marketing programs have been extremely
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successful, leading to the submission of claims to the Medicare and Medicaid programs for medically unnecessary and imprudent prescriptions which otherwise would not have been paid by Medicare and Medicaid.

184.

Each Zyprexa claim submitted to the State of California for Zyprexa

prescribed for an off-label use not only violates Medicare payment rules, but constitutes the submission of a fraudulent claim redressable by California's False Claims Act, Cal. Gov. Code §§ 12650 et seq. 185. The remedial provisions of the California's False Claims Act is the

necessary vehicle to obtain redress for the substantial economic harm suffered by Medi-Cal as a result of the millions of dollars of Zyprexa reimbursement claims caused to be written and submitted by enrolled Medi-Cal pharmacy benefits providers t o the State of California as a direct and foreseeable result of Lilly's illegal off-label marketing campaign. 186. Lilly's wanton misconduct has been ongoing since at least 2001.

XI.

THE CALIFORNIA FALSE CLAIMS ACT
187. The California False Claims Act, Cal. Gov. Code §§I2650 et seq., provides,

in pertinent part that a person is liable to the State of California for a civil penalty of up to $10,000, plus not less than two times and not more than three times the amount of damages which the State of California sustains because that person, inter alia,: (a)
(1)

Liability for certain acts. Any person whoKnowingly presents, or causes to be presented, to an officer

of the state or of any political subdivision thereof, a false claim for payment or approval; (2) Knowingly makes, uses, or causes to be made or used, a false

r