Trial began on January 9 in Texas for for Johnson & Johnson Inc. and its subsidiary Janssen Pharmaceutical LLC, along with five other related companies which are accused of having defrauded the state in a “sophisticated marketing scheme” that caused the Texas Medicaid program to pay too much for the schizophrenia drug Risperdal. The State is also alleging that the company misled state health officials about the drug’s effectiveness.
On January 19, it was ruled that Johnson & Johnson would pay $158 million to the State of Texas to resolve the state’s Medicaid claims.
Texas Attorney General Greg Abbott stated: “Today’s agreement sends a strong message that the State will pursue those who defraud Texas taxpayers. Johnson & Johnson’s scheme to profit from the Medicaid program by overstating the safety and effectiveness of an expensive drug and improperly influencing officials ended up costing taxpayers millions of dollars.”