Those whistle-blowing sales reps caught another one.

Medicis agreed to settle allegations the company violated the False Claims Act concerning claims submitted to Medicaid, the Justice Department announced today. The settlement resolves charges Medicis promoted a topical skin preparation, Loprox, for use on children under the age of 10, without FDA approval.

The US and four former Medicis employees alleged that from approximately November 2001 through April 2004, Medicis sales personnel targeted pediatricians, urging the docs to use Loprox as a treatment for diaper rash. Loprox, which is approved as a fungicide for kids over 10, isn’t a “medically accepted indication” for the treatment of diaper dermatitis and other skin disorders in children under 10.

“This settlement demonstrates our ongoing commitment to protecting funds for federal health care programs,” said Assistant Attorney General Pete Keisler. “Pharmaceutical companies need to know that they will be held accountable for off-label marketing schemes and other illegal activities that affect those programs.”

In the case against Medicis, the United States alleged that the Medicaid program paid millions of dollars for Loprox prescriptions that would not have been reimbursed if government authorities had known that the prescriptions resulted from the company’s off-label marketing campaign. Medicis sold its pediatric sales unit in 2004.

As a result of the settlement, the whistleblowers will collectively receive in excess of $1,078,000 as their statutory award. Under the qui tam provisions of the False Claims Act, private parties can file an action on behalf of the US and receive a portion of the settlement if the government reaches a monetary agreement with the defendants.

(As soon as the DOJ press release is posted, a link will be provided).[tags]Medicis Pharmaceuticals, Off-Label Marketing, Sales Reps[/tags]