Teva acknowledges U.S. investigation

The marketing of Copaxone , which is used to treat multiple sclerosis, is under scrutiny by the U.S. Attorney's Office in New York. Teva Pharmaceuticals
The marketing of Copaxone , which is used to treat multiple sclerosis, is under scrutiny by the U.S. Attorney's Office in New York. Teva Pharmaceuticals
Posted: February 12, 2014

John Pease helped lead health-care fraud investigations - as well as sending former Pennsylvania State Sen. Vincent J. Fumo to prison - before leaving the U.S. Attorney's Office in Philadelphia in January 2013.

Now, as senior counsel at Teva Pharmaceuticals USA, Pease will be on the other side of a health-care legal fight.

Teva said Monday, in a Securities and Exchange Commission filing, that it was under investigation by the U.S. Attorney's Office in Manhattan over sales practices related to its best-selling drug, Copaxone.

Pease declined to comment Monday. Last March, the legal blog mainjustice.com quoted him, regarding the move to Teva, as saying, "I was just ready to try something different."

Teva is based in Israel, but its Americas headquarters is in North Wales, Montgomery County, and it employs about 2,300 people in Pennsylvania, mostly in the Philadelphia suburbs.

Teva is the world leader in sales of generic prescription medicine. But $4.3 billion of Teva's total 2013 revenue of $20.3 billion (21.3 percent) came from sales of Copaxone, a patented injectable drug used to treat multiple sclerosis.

Teva said in Monday's SEC filing that on Jan. 8 it received a subpoena for documents and information related to Copaxone and another drug, Azilect, from 2006 to the present. Teva said the subpoena says the government is investigating possible "civil violations" of federal laws on drug marketing.

Spokeswoman Denise Bradley said Teva was "fully cooperating" with the investigation, but declined further comment.

The company has been under pressure on several fronts.

New chief executive officer Erez Vigodman takes over Tuesday, following Jeremy Levin's departure after a fight with the board of directors.

Copaxone's main patents expire in May, so Teva expects generic competition to hurt sales in the second half of 2014, though it hopes an easier-to-use version will help it retain patients. A $2 billion-per-year cost-cutting plan will be implemented by the end of 2014 and slice 5,000 jobs from the current global workforce of about 45,000.

Besides the Fumo case, Pease guided Philadelphia prosecutors in an investigation of Synthes Inc., the medical device company that had its headquarters in Chester County until Johnson & Johnson bought it for $19.7 billion in 2011. Four Synthes executives pleaded guilty and went to prison - a rarity in health-care fraud cases - because of their involvement in an illegal clinical trial of bone cement. Three patients died on operating tables after the cement was injected into their spines.


dsell@phillynews.com

215-854-4506

@phillypharma

www.inquirer.com/phillypharma

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