Just as Teva Pharmaceuticals (NYSE:TEVA) hopes to wrap up its $6.2 billion acquisition of Cephalon (NASDAQ:CEPH), the biotech company has been asked by the feds about documents relating to alleged off-label promotion of its fast-growing Treanda medication, which is used to treat chronic lymphocytic leukemia and racked up $117 million in sales in the first quarter of the year.
Last month, Cephalon received a notice from the US Department of Justice concerning paperwork pertaining to off-label use, including use of Treanda for first-line treatment of non-Hodgkin lymphoma (the med is not approved for this purpose - see here), according to sources familiar with the request. The feds also want clinical studies that could be used to support off-label use before the studies were completed or submitted to the FDA for review.
The feds are also interested in educational and speaker programs that reference off-label use; uncompleted clinical studies that may be used to support off-label use; documents pertaining to a clinical study being conducted by to Mathias Rummel, who is the head of hematology at the University Hospital in Giessen, Germany, and has previously studied Treanda (see this); and documents related to a study called Bright, which is designed to test whether the drug could combat advanced low-grade non-Hodgkin lymphoma and mantle cell lymphoma in patients who have not yet received treatment (read here).
The probe could complicate life for Cephalon, which is already operating under a so-called Corporate Integrity Agreement in connection with its 2007 plea to a misdemeanor violation of the Food, Drug and Cosmetic Act for improper marketing of several meds, notably its Provigil narcolepsy drug, which docs were prescribing to treat depression and ADHD (read here). The drugmaker paid a $375 million fine as well.
What, if any, implications this may cause for the deal with Teva is unclear. Teva, which is one of the biggest generic suppliers in the world, wants to buy Cephalon in order to blunt competition to its brand name Copaxone multiple sclerosis med and expand further into the brand-name medicine world. Cephalon, which experienced a different kind of tumult since co-founder and ceo Frank Baldino passed away last winter (see here), is developing treatments for lung cancer, congestive heart failure and asthma, for instance.
A Cephalon spokeswoman declined to comment.
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