Vanda inks $11.5M deal to settle off-label drug promotion accusations
19 Sep 2022
Vanda Pharmaceuticals took the FDA to court three separate times this year as it struggles to win over regulators with its sleep and chronic digestive disorder drugs. Now, the company has agreed to drop $11.5 million to settle claims that it illegally promoted the sleep drug and one other off-label.
A suite of investors filed a class action suit against Vanda back in 2019, alleging that the company promoted unapproved uses for its two commercial drugs Fanapt and Hetlioz, the former of which treats schizophrenia in adults and the latter of which is cleared for sleep disruptions in those with Smith-Magenis syndrome and Non-24, a circadian rhythm disorder common in blind patients.
Plaintiffs accused Vanda of training its sales reps to market Fanapt for mental disorders other than schizophrenia and focusing Hetlioz sales on sighted individuals who have trouble sleeping, and compensating reps for off-label sales. Plaintiffs also claim that Vanda targeted pediatric patients with Fanapt even though it’s only approved for adults, and presented it as a once-daily medication despite the label suggesting twice daily administration.
Investors further alleged that Vanda ignored the FDA’s request for a nine-month safety study before initiating a human study longer than three months for tradipitant, its experimental chronic digestive disorder drug, ultimately leading to a clinical hold on that program.
The complaint states:
A federal judge previously dismissed claims against former CFO James Kelly, former chief commercial officer Thomas Gibbs, and current CCO Gian Piero Reverberi, but upheld allegations against CEO Mihael Polymeropoulos and the company as a whole. Polymeropoulos co-founded Vanda in 2003 after leaving Novartis.
On Thursday, Magistrate Judge Lois Bloom gave preliminary approval to a $11.5 million settlement. The company, however, has not admitted any wrongdoing as part of the deal.
Vanda’s lawyers have been quite busy this year, as the company has already filed suit against the FDA three times. The most recent case was submitted on Thursday, in which Vanda accused regulators of failing to give it a hearing to determine if it can add a jet lag disorder indication to Hetlioz, which currently reaches a much smaller group of patients.
Non-24 is a rare neurological disease that occurs primarily among blind patients, when the body’s sleep-wake cycle becomes out of sync with the 24-hour day-night cycle. The drug also won approval a couple years ago to treat sleep disruptions associated with the developmental disorder Smith-Magenis syndrome.
Vanda
also sued the FDA back in April
over Hetlioz, alleging that the agency wrongfully withheld parts of a rejection letter for the jet lag indication. A month later, the company sued again over the FDA’s refusal to grant fast-track designation to tradipitant.
The company was not immediately available for comment.
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