Zyprexa was initially received as a significant advance over an earlier generation of antipsychotics. But a series of landmark studies in recent years have cast doubt on that long-held view and suggested that Zyprexa is no better than older drugs that sell for far less.
A government study published in September, for instance, found that Zyprexa was no more effective in children than an older medicine but caused more serious side effects. Indeed, the children receiving Zyprexa gained so much weight during the study that a safety monitoring panel ordered that they be taken off the drug.
In December 2006, The New York Times published articles detailing hundreds of internal Lilly documents and e-mail messages among top company managers that showed how the company sought for years to downplay Zyprexa's tendency to cause severe weight gain and metabolic disorders, including diabetes, while promoting unapproved uses.
One 2000 e-mail message, for instance, described how a group of diabetes doctors that Lilly had retained to consider potential links between Zyprexa and diabetes had warned the company that "unless we come clean on this, it could get much more serious than we might anticipate."
The government's case will remain sealed until at least Thursday, when a judge is expected to approve the settlement. People involved in the negotiations say that prosecutors pressed for a resolution in the waning days of the Bush Administration to avoid having to get another set of approvals from new bosses at the Justice Department in Washington.
While the settlement is intended to resolve all pending government claims, it is unclear whether all states, which are parties to the case through the federal-state Medicaid program, have agreed to terms.
Some of the claims and evidence in the government's case are similar to those made in a pending California state whistleblower lawsuit in which Jaydeen Vicente, a former Lilly sales representative, described years of what she said were illegal Zyprexa marketing efforts.
Ms. Vicente claimed, for instance, that Lilly paid kickbacks to doctors who prescribed large amounts of Zyprexa by hiring them to educate other doctors through a "speaker's program" or by sending doctors to posh resorts where they were trained to be speakers.
"The speaking engagements were frequently a mere sham," Ms. Vicente's lawsuit states. "Lilly-paid speakers were even paid to give pointless presentations to their colleagues at the healthcare facility with which they were affiliated."