Merck & Co will pay roughly $950 million to settle criminal and civil charges that it promoted the painkiller Vioxx for an unapproved use, the U.S. Justice Department said on Tuesday.

The fine will conclude a long-running investigation into Merck’s promotion of its one-time blockbuster drug, which was withdrawn from the market in September 2004 after being linked to heart risks.

The Justice Department alleged that Merck promoted the drug for treating rheumatoid arthritis before it had been approved for that condition by the U.S. Food and Drug Administration.

The case is one of the largest settlements by a major pharmaceutical company over marketing drugs in the United States for uses that have not been approved by the FDA, known as off-label promotion.

“We will not hesitate to pursue those who skirt the proper drug approval process and make misleading statements about the safety and efficacy of their products,” said Tony West, the Justice Department’s assistant attorney general for the civil division, in a statement.

Merck pled guilty to a misdemeanor charge and will pay a $321.6 million criminal fine for introducing the misbranded drug Vioxx into interstate commerce.

It also agreed to pay an additional $628.4 million civil settlement to resolve additional allegations regarding its off-label marketing of Vioxx and alleged false statements about the pill’s heart safety. The U.S. government will recover $426 million of that amount, while the remainder will go to the states in the lawsuit.

HEART RISKS

The Justice Department said Merck also agreed to a corporate integrity agreement to strengthen oversight over its marketing. Merck said the settlement does not mean it admits liability or wrongdoing.

“We believe that Merck acted responsibly and in good faith in connection with the conduct at issue in these civil settlement agreements, including activities concerning the safety profile of Vioxx,” said Bruce Kuhlik, executive vice president and general counsel of Merck, in a statement.

The large American drugmaker had already told investors in October 2010 it was taking a $950 million charge related to the U.S. government probe.

The civil settlement agreement is signed with the United States and individually with 43 states and the District of Columbia, but previously disclosed litigation with seven states is still unresolved, Merck said.

States have said the company misled regulators about the dangers associated with Vioxx, which has been linked in lawsuits to increasing users’ risk of heart attacks and other serious cardiovascular side effects.

In 2007, Merck also agreed to pay $4.85 billion to settle lawsuits filed by thousands of former Vioxx users, who alleged the pill caused heart attacks.

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By Anna Yukhananov
(Reuters)