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Amgen Pleads Guilty, Pays $762 Million in Penalties

Amgen Inc. will pay $762 million after it accepted criminal liability on Tuesday to illegally marketing its anemia drug Aranesp. The Thousand Oaks company, represented by its general counsel, pleaded guilty in U.S. District Court in Brooklyn to one misdemeanor count of misbranding the anemia drug. Prosecutors said the company was recommending higher doses and frequency of use than the drug was labeled for by the Food and Drug Administration. It was also urging use of the drug in cancer patients with anemia who were not undergoing chemotherapy, which later was proven to be dangerous. A hearing is set for Wednesday for a judge to accept the plea. The settlement agreement includes $136 million in criminal fines, $14 million in criminal forfeiture and $612 million to settle civil lawsuits related to the misbranding. Also as part of the deal, the company’s board of directors and executives must sign an agreement with the Department of Health and Human Services in which they agree to personally oversee regulatory compliance. Failure to do so could trigger personal criminal and civil liabilities. Once the company’s biggest drug, sales of Aranesp have fallen off in recent years as concerns about the safety of the drug increased. Some doctors have said it causes heart attacks and can actually accelerate the growth of cancer. Additionally, the company has recently indicated that it may settle a lawsuit regarding the sales practices surrounding Embrel, a rheumatoid arthritis and psoriasis drug. Amgen is not the first biopharmaceutical company to plead guilty to charges of improperly marketing one of its drugs. In 2009, Pfizer Inc. paid $2.3 billion for illegally marketing its pain medication Bextra. Last year, Merck & Co. paid $950 million for sales practices related to painkiller Vioxx, and in July GlaxoSmithKline USA pleaded guilty to fraud for misrepresenting the approved uses of half a dozen drugs. Shares of Amgen lost 21 cents, or less than 1 percent, to close at $89.29 on the Nasdaq.

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