It was revealed today that Johnson & Johnson (JNJ
) will pay $2.2 billion to end civil and criminal investigations; this sum is one of the largest healthcare fraud settlements in history.
The charges were related to the marketing of several drugs, which were allegedly promoted for unapproved uses. These included the drugs Risperdal, Invega, and Natrecor, and their advertising over a multiple year period. The drugs were marketed through a J&J subsidiary named Janssen, which pleaded guilty to a misdemeanor for its promotion of Risperdal.
On top of that, the company had also allegedly been paying out large sums in kickbacks to doctors and institutions that pushed the drugs onto patients. It should be noted that J&J released a statement saying that the settlement is in no way an admission of liability or wrongdoing and that it denies the government’s allegations.
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Investors seemed to have a muted reaction, as JNJ was only down 0.37% on the day. The company is currently sitting on over $25 billion in cash, which likely helped to alleviate some of the concerns as to how the settlement would hit the company.
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