Cephalon settles with DOJ

Executive Summary

Cephalon will plead guilty to a single federal misdemeanor violation of the Food, Drug and Cosmetic Act and pay a $425 million fine to settle a federal investigation into promotional practices for Provigil, Actiq and Gabitril, firm announces Nov. 8. The settlement also requires the company to enter into a corporate integrity agreement with the HHS Office of Inspector General, details of which are not yet finalized. Investigation by Philadelphia U.S. Attorney's Office was first reported in 2004 (1"The Pink Sheet" Sept. 13, 2004, p. 29). Settlement amount is on par with fines paid in recent years by companies like Pfizer ($430 million) and Schering-Plough ($435.5 million) to resolve similar charges. Cephalon has $700 million in the bank, more than enough to cover the costs, firm notes during third quarter earnings call...