Company Finalizes Previously Announced Agreement with U.S. Attorney's
Office for Eastern District of Pennsylvania and U.S. Department of Justice
Settles State Cases with Connecticut and Massachusetts
FRAZER, Pa., Sept. 29 /PRNewswire-FirstCall/ -- Cephalon, Inc. (Nasdaq:
CEPH) announced today it has finalized a previously announced agreement in
principle with the U.S. Attorney's Office for the Eastern District of
Pennsylvania, the U.S. Department of Justice and various other federal
agencies. The Company also reached separate agreements with the Attorneys
General of the states of Connecticut and Massachusetts to settle related
investigations into the company's sales and promotional practices. The
initial investigations began in 2004 and involved three of the company's
nine proprietary products in the United States -- Actiq(R) (oral
transmucosal fentanyl citrate) [C-II], Provigil(R) (modafinil) Tablets
[C-IV], and GabitRil(R) (tiagabine hydrochloride). Cephalon fully
cooperated with all governmental entities throughout these investigations.
Under the previously disclosed terms of the federal settlement,
Cephalon will pay the $425 million reserved in 2007 plus an estimated $12
million in accrued interest expense, plead guilty to a single misdemeanor
violation of the U. S. Food, Drug, and Cosmetic Act, and enter into a
five-year Corporate Integrity Agreement (CIA) with the Office of the
Inspector General of the U.S. Department of Health and Human Services. The
guilty plea is subject to approval by the U.S. District Court for the
Eastern District of Pennsylvania.
"We are pleased to have these long-standing matters behind us, while
preserving our ability to participate in all federal and state health care
programs, thereby maintaining the access of patients in those programs to
our medications," stated Jerry Pappert, Executive Vice President and
General Counsel, and a former Attorney General of the Commonwealth of
Pennsylvania.
"We believe our existing compliance policies and procedures already
address the majority of the requirements outlined in the CIA and that the
strong compliance infrastructure now in place has improved the
accountability of our employees and the transparency of our actions," said
Valli Baldassano, Executive Vice President and Chief Compliance Officer. A
copy of the CIA can be found at: http://oig.hhs.gov/fraud/cia/index.html.
Cephalon also settled its two outstanding state government
investigations for a total of $6.85 million. In its settlement with the
Connecticut Attorney General and Commissioner of Consumer Protection,
Cephalon agreed to a $6.15 million payment, which includes a contribution
of $3.8 million to the Connecticut Department of Public Health to fund
state cancer initiatives and $200,000 to fund an electronic prescription
monitoring program. In addition, the company agreed to a payment of
$700,000 to settle an investigation with the Attorney General of the
Commonwealth of Massachusetts. Four hundred fifty ($450) thousand dollars
of that payment will be used to benefit consumers in Massachusetts and for
comprehensive cancer initiatives.
"We are particularly satisfied that the largest share of the payments
made to settle the state Attorney General investigations are for programs
and initiatives consistent with our commitment to patients," added Cephalon
General Counsel Pappert. "These contributions are aligned with our
commitment to the oncology community and our emerging oncology business."
Cephalon has posted a set of Frequently Asked Questions about these
settlements on its website at http://www.cephalon.com/media/on-the-record/
Cephalon, Inc.
Founded in 1987, Cephalon, Inc. is an international biopharmaceutical
company dedicated to the discovery, development and commercialization of
many unique products in four core therapeutic areas: central nervous
system, pain, oncology and addiction. A member of the Fortune 1000,
Cephalon currently employs approximately 3,000 people in the United States
and Europe. U.S. sites include the company's headquarters in Frazer,
Pennsylvania, and offices, laboratories or manufacturing facilities in West
Chester, Pennsylvania, Salt Lake City, Utah, and suburban Minneapolis,
Minnesota. The company's European headquarters are located in
Maisons-Alfort, France.
The company's proprietary products in the United States include:
AMRIX(R) (cyclobenzaprine hydrochloride extended-release capsules),
TREANDA(R) (bendamustine hydrochloride) for Injection, FENTORA(R) (fentanyl
buccal tablet) [C-II], PROVIGIL, TRISENOX(R) (arsenic trioxide) injection,
VIVITROL(R) (naltrexone for extended-release injectable suspension),
GABITRIL, NUVIGIL(TM) (armodafinil) Tablets [C-IV] and ACTIQ. The company
also markets numerous products internationally. Full prescribing
information on its U.S. products is available at http://www.cephalon.com or
by calling 1-800-896-5855.
In addition to historical facts or statements of current condition,
this press release may contain forward-looking statements. Forward-looking
statements provide Cephalon's current expectations or forecasts of future
events. These may include statements regarding anticipated approval by the
U.S. District Court of the guilty plea; continued ability to participate in
government health care programs; expectations regarding the company's
compliance programs and policies; anticipated scientific progress on its
research programs, development of potential pharmaceutical products,
interpretation of clinical results, prospects for regulatory approval,
manufacturing development and capabilities, market prospects for its
products, sales and earnings guidance, and other statements regarding
matters that are not historical facts. You may identify some of these
forward-looking statements by the use of words in the statements such as
"anticipate," "estimate," "expect," "project," "intend," "plan," "believe"
or other words and terms of similar meaning. Cephalon's performance and
financial results could differ materially from those reflected in these
forward-looking statements due to general financial, economic, regulatory
and political conditions affecting the biotechnology and pharmaceutical
industries as well as more specific risks and uncertainties facing Cephalon
such as those set forth in its reports on Form 8-K, 10-Q and 10-K filed
with the U.S. Securities and Exchange Commission. Given these risks and
uncertainties, any or all of these forward-looking statements may prove to
be incorrect. Therefore, you should not rely on any such factors or
forward-looking statements. Furthermore, Cephalon does not intend to update
publicly any forward-looking statement, except as required by law. The
Private Securities Litigation Reform Act of 1995 permits this discussion.
SOURCE Cephalon, Inc.
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Related links:
http://www.cephalon.com
http://www.cephalon.com/media/on-the-record
http://www.prnewswire.com/comp/134563.html/
CONTACT:
Media, Sheryl Williams, +1-610-738-6493
(office), +1-610-457-5257 (cell), swilliam@cephalon.com, or
Investor Relations, Chip Merritt, +1-610-738-6376 (office),
cmerritt@cephalon.com, both of Cephalon, Inc.
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