BOSTON (AP) – Jurors acquitted eight current and former employees of TAP Pharmaceutical Products on Wednesday of charges they offered doctors improper consulting fees, dinners, golf trips and other kickbacks to get them to prescribe certain drugs.
The federal jury deliberated for parts of four days following a three-month trial.
The case had been closely watched by the drug industry and the medical profession, which have been criticized in recent years for giving and receiving freebies. Critics say the practice drives up the already high costs of prescription drugs and erodes public confidence that doctors are prescribing the right medicines.
Prosecutors argued that the TAP employees lavished golf and ski trips, free dinners and other incentives on doctors, along with free drug samples, in exchange for the physicians’ agreement to prescribe TAP’s prostate cancer drug Lupron and the heartburn medicine Prevacid.
“The line between marketing and what they call a kickback is not clear,” said Steve Delinsky, the lawyer for defendant Rita Jokiaho, a former a district sales manager for TAP in Massachusetts. “The jury determined (the defendants) were conducting legitimate marketing. These people did not have any intention to violate the law.”
The government also charged that current and former executives and sales managers at Lake Forest, Ill. – based TAP conspired to defraud Medicare and Medicaid by urging doctors to bill the government for the free drug samples.
But defense lawyers argued that the employees offered the samples to promote the drugs, a practice which is legal, and that the employees offered standard consulting fees to doctors, who were not obligated in return to prescribe TAP’s drugs. The defense also said the employees never encouraged doctors to bill Medicare and Medicaid for the free samples.
“I’m happy that finally the truth came out,” said Jokiaho, who lives in the Boston suburb of Stoneham. “I just want to go home and celebrate.”
TAP itself was not on trial. The government settled with the company in 2001 for $875 million.
The government’s star witness was Doug Durand, TAP’s former vice president of sales, who filed a whistleblower lawsuit in 1996 alleging that some members of the company’s sales force were offering kickbacks to doctors.
As the chief whistleblower in the case, Durand received $42 million as part of the government’s settlement with TAP, a 50-50 venture between Abbott Laboratories, of Abbott Park, Ill., and Takeda Chemical Industries Ltd. in Japan.
The trial began in April with 11 former and current employees charged. Charges were dropped mid-trial against three of the employees – two for insufficient evidence and a third for undisclosed health reasons.
Several of the defendants cheered as the verdicts were read, prompting a reprimand from Judge Douglas Woodlock. Their family members kissed, hugged, and cried as the charges were formally dropped.
“I feel vindicated,” said defendant Donald Patton, a former TAP vice president of sales from Detroit. “I can stop living life looking through the rear view mirror. I’m going to get my career back on track.”
A spokeswoman for U.S. Attorney Michael Sullivan did not return calls seeking comment.
The complexity of the laws makes it hard for prosecutors to win convictions, according to Mark Schreiber, a lawyer at the Boston firm of Palmer and Dodge, which was not affiliated with the case.
“It would be helpful if there were bright line as to what is proper and improper conduct,” said Schreiber, a partner in the firm’s labor and employment division.
It’s unlikely sales people will return to prior practices, he said.
“There’s no turning the clock back. The government’s interpretation of these rules is increasingly severe,” he said. “Some of the more aggressive practices had already been tempered or ceased.”
TAP spokeswoman Catherine Stueland said the company has strengthened its ethics and training programs for employees since the 2001 settlement.
“It is a day of enormous relief for these individuals and their families,” the company said in a statement. “They have their lives back.
Patton’s lawyer, William H. Kettlewell, said the verdict sends a message to government prosecutors.
“The government put the pharmaceutical industry on trial with this case and the jury’s acquittal of Don and his seven co-defendants is a rejection of the government’s assault on the industry as a whole,” Kettlewell said in a statement.
AP-ES-07-14-04 1934EDT
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