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Johnson & Johnson Pays $158 Million for Fraud

AUSTIN (CN) - Johnson & Johnson will pay $158 million to settle Texas' complaint of Medicaid fraud, ending a trial in Travis County Court that began on Jan. 10.

State prosecutors said Johnson & Johnson and its subsidiary Janssen Pharmaceuticals pushed Risperdal for off-label uses, to treat children and adults for schizophrenia and dementia, though the FDA had not approved it for that. Johnson & Johnson also "downplayed the harmful side effects of this drug," the Texas Attorney General's Office said in a statement announcing the settlement.

Physicians are allowed to prescribe drugs for off-lable uses, but drug companies are not allowed to push their drugs for that.

The state said its Medicaid program overpaid pharmacies that dispensed Risperdal to Medicaid patients for unapproved uses.

Prosecutors said it was the Medicaid overbilling case to go to trial in the state. ActavisGroup went to a trial in early 2011. It settled with the state in December for $84 million.

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