Anglo-Swedish pharmaceutical company AstraZeneca agreed yesterday to pay $520 million plus interest to the US government to resolve allegations that it illegally marketed its block-buster anti-psychotic drug Seroquel for uses not approved as safe and effective by the US regulator.

Seroquel is AstraZeneca's schizophrenia and bipolar blockbuster drug that has been ranked as the fifth best-selling drug in the world by drug-data tracker IMS Health and had sales of $4.9 billion last year.

The US Food and Drug Administration (FDA) had approved Seroquel for the treatment of schizophrenia and bipolar depression but the US federal agencies allege that the London-based AstraZeneca had aggressively promoted the drug to psychiatrists and other physicians for unapproved uses like for the treatment of Alzheimer, aggression, anger management, anxiety, attention deficit hyperactivity disorder, bipolar maintenance, dementia, depression, mood disorder, post-traumatic stress disorder and sleeplessness.

The US Department of Justice (DoJ) said that AstraZeneca targeted its illegal marketing of Seroquel towards doctors who do not typically treat schizophrenia or bipolar disorder, such as physicians who treat the elderly, primary care physicians, paediatric and adolescent physicians, and in long-term care facilities and prisons.

The federal agencies also said AstraZeneca violated the federal anti-kickback laws by offering and paying illegal remuneration to doctors for writing articles on the unapproved uses of Seroquel.

They alleged that AstraZeneca also offered and paid illegal remuneration to doctors to travel to resort locations to "advise" and to give promotional lectures to other health care professionals about unapproved and unaccepted uses of Seroquel.

AstraZeneca, which generated global revenues of $32.8 billion in 2009, although denying these allegations, signed a civil settlement yesterday and agreed to pay $520 million plus interest to the US government for filing false payment claims to federal insurance programs including Medicaid, Medicare and TRICARE programs, the Department of Veterans Affairs, the Federal Employee Health Benefits Program and the Bureau of Prisons.

As part of the settlement, AstraZeneca has also signed a five-year corporate integrity agreement with the US federal government over its marketing of Seroquel for unapproved uses, and will intimate doctors about the settlement as well as post on its website, information about payments to doctors.

The US government's investigation was triggered by a whistleblower lawsuit filed under the False Claims Act by James Wetta, who, as part of the settlement, will receive more than $45 million from the federal share of the civil recovery.

"Illegal acts by pharmaceutical companies and false claims against Medicare and Medicaid can put the public health at risk, corrupt medical decisions by health care providers, and take billions of dollars directly out of taxpayers' pockets," said attorney general Eric Holder. 

"This Administration is committed to recovering taxpayer money lost to health care fraud, whether it's by bringing cases against common criminals operating out of vacant storefronts or executives at some of the nation's biggest companies," he added.

By settling with the US government on Seroquel is not the end of this problem for AstraZeneca as it facing 25,000 civil lawsuits to the tune of more than $1.2 billion from users of the drug who allege that they have become overweight or diabetic after taking the drug prescribed by physicians.

A company email that was buried showed that in a study conducted by outside agencies in 2007, Seroquel users gained about 11 pounds a year, while AstraZeneca claimed that its study showed that users lost weight.