Franklin v. Parke-Davis: First Off-Label Case Under False Claims Act

In 1996, Greene LLP attorney Thomas M. Greene filed a False Claims Act suit on behalf of former Parke-Davis employee Dr. David Franklin, who was concerned about the company’s off-label promotion practices for its drug Neurontin.  The drug was approved for treating epilepsy, but was also marketed as a therapy for a wide variety of conditions, including general neuropathic pain, migraines, and even bipolar disorder.

The vast majority of government recoveries under the False Claims Act have been from cases in which the government has elected to intervene.  Greene’s theory that illegal off-label promotion caused the submission of false claims to the government was novel and unproven, and the government declined to intervene in the case.  Greene and Franklin persevered through nearly eight years of litigation.  In May 2004, Pfizer, Inc., which had acquired Parke-Davis and its parent company Warner Lambert, settled the Neurontin case for a total recovery of $430 million in civil fines and criminal penalties.  The settlement is noteworthy as the first under Greene’s novel off-label theory, as the largest settlement of a declined False Claims Act case, and as one of the highest relator’s share percentages ever awarded — the $24.64 million federal relator’s share was 29.5% of the federal civil portion of the recovery.

The U.S. ex rel. Franklin v. Parke-Davis case has served as a precedent for a number of other off-label False Claims Act cases resolved since 2004, totaling nearly $8 billion in government recoveries.  It also paved the way for a $142 million RICO verdict against Pfizer in 2010 involving 0ff-label promotion of Neurontin.