Jazz Pharmaceuticals, Inc. has agreed to pay $20 million in penalties and victim compensation to resolve parallel criminal and civil investigations conducted by the DOJ relating to the illegal marketing practices of its wholly-owned subsidiary Orphan Medical, Inc. (Orphan).

As part of this resolution, Orphan pleaded guilty to felony misbranding in violation of the Food, Drug, and Cosmetic Act in connection with its illegal promotion of the prescription medication Xyrem, also known as gamma-hydroxybutyrate or “GHB,” for unapproved uses. GHB is a powerful and fast-acting central nervous system depressant that has been subject to abuse as a recreational drug and is classified by the Department of Health and Human Services (HHS) as a “date rape” drug.

Jazz has also agreed to implement a corporate integrity agreement which includes a Code of Conduct that prohibits promotion for unapproved or “off-label” use, requires compliance training for promotional speakers and sales representatives, and replaces the former Orphan regional sales managers who were responsible for overseeing the conduct of sales representatives in their respective territories.

By pleading guilty, Orphan admitted that, through sales representatives and at least one medical professional, it engaged in a scheme to expand the market for Xyrem by promoting the drug to physicians for “off-label” medical uses that include fatigue, insomnia, chronic pain, EDS (before EDS became an approved indication), weight loss, depression, bipolar disorders, and movement disorders such as Parkinson’s Disease.

Jazz will not be prosecuted for the unlawful practices of Orphan employees provided that the company fully complies with the terms of its agreement with the government.