UPDATE: Allergan Sees Suit Against Government As Unique To Company

Allergan Inc. (AGN) officials said Friday the drug maker's lawsuit against the government, seeking the right to discuss unapproved uses of its drug Botox with doctors, is a company-specific issue and that it isn't working with industry lobbyists or third-party advocates.

Nonetheless, the case's outcome could have implications for the broader drug industry. If Allergan were to prevail, drug companies inclined to push the envelope on off-label marketing may feel emboldened. If Allergan loses, the status quo would be maintained.

At issue is a drug that racked up $1.31 billion in 2008 sales for the Irvine, Calif., drug maker, and gets as much as a third of that from off-label sales, according to some Wall Street estimates. The Food and Drug Administration approves drugs for specific uses, and physicians are free to prescribe drugs as they see fit, although it is illegal for companies to promote such uses.

"We aren't interested in being crusaders. We are focused on an issue that is unique to Allergan and unique to our product," Douglas Ingram, Allergan executive vice president and chief administrative officer, said on a conference call Friday.

Allergan said it isn't altering its current practice and doesn't see sales in approved uses being affected if it loses the case, which is seen taking six to 12 months.

Botox is approved in the U.S. to fight facial wrinkles but also for medical purposes such as uncontrollable blinking and crossed eyes; it has five approved uses in the U.S., but 21 different indications worldwide.

Off-label examples for Botox include treating migraine headaches and spasticity, a condition in which muscles involuntarily tighten and contract. The company said this is the most common unapproved usage.

There is already an estimated $50 million market for Botox as a migraine treatment. Allergan has estimated this market could eventually be worth up to $500 million a year should it win FDA approval.

The issue of unapproved marketing can be expensive: Pfizer Inc. (PFE) recently agreed to pay $2.3 billion to settle federal allegations of unlawful drug promotion. And Allergan itself received a subpoena last year from the Department of Justice about Botox marketing practices.

Allergan said that investigation wasn't related to its latest move, as the inquiry is about past practices and the lawsuit addresses the company's future.

Off-label marketing can be an area of tension between the FDA and the industry. The FDA allows companies to distribute reprints of medical-journal articles that discuss certain off-label uses of drugs, but generally bars company representatives from proactively discussing the material further.

"The issue of off-label promotion has always been a delicate one for FDA, and clearly there are advantages and benefits to allowing companies to disseminate scientific journal articles," said Patrick Ronan, a former FDA chief of staff and currently head of Greenleaf Health LLC, a consultant to health-care companies on regulatory matters.

"But at the same time there are some companies that have clearly crossed the line and used that opportunity to promote products off label. So that's what the FDA tries to balance on a daily basis, and it's been controversial." In its lawsuit, Allergan argues that the recently revised label for Botox includes information related to off-label use, but the law prevents the company from actively providing additional information to physicians in such areas as injection procedure and patient selection. The company concedes that it can provide such information upon request.

"Prohibiting drug companies from proactively sharing relevant and truthful information with physicians regarding the risks, benefits and techniques for off-label uses does not serve the public health or patient care," Ingram said.

Ingram noted that the company is blocked from approaching certain specialist physicians because Botox's approved uses don't fall with their area of practice.

The company stressed that it wouldn't use direct-to-consumer advertising for off-label indications or enlist its sales representatives to disseminate such information, but would rely on its medical affairs staff and scientists.

Allergan shares fell 85 cents to $55.10 Friday afternoon.

-By Thomas Gryta, Dow Jones Newswires; 212-416-2169; [e-mail]

(Jon Kamp in Boston and Peter Loftus in Philadelphia contributed to this report)