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UPDATE: Abbott Labs: US Justice Department Probing Depakote

(Adds background information, updated stock price, in the sixth through ninth paragraphs.)

By Peter Loftus

Of DOW JONES NEWSWIRES

The U.S. Justice Department is investigating Abbott Laboratories' (ABT) sales and marketing activities for its anti-seizure drug Depakote, the drug maker disclosed Friday.

Abbott said in a regulatory filing that the U.S. Attorney for the Western District of Virginia is seeking to determine whether Abbott's marketing activities violated civil or criminal laws including the Federal False Claims Act, the Food and Drug Cosmetic Act, and the Anti-Kickback Statute "in connection with Medicare and/or Medicaid reimbursement to third parties."

Abbott spokeswoman Adelle Infante said the Abbott Park, Ill., company is cooperating with the investigation, but declined further comment.

A spokesman for the U.S. Attorney in the Western District of Virginia couldn't immediately be reached.

Depakote is approved to treat bipolar disorder and seizures and to prevent migraine headaches. Sales declined 70% to $354 million for the first nine months of 2009 due to generic competition.

Earlier this year, the U.S. Food and Drug Administration sent Abbott a warning letter saying that a promotional material for Depakote was misleading and violated federal law. A promotional flashcard shown to health-care professionals omitted certain information about the drug's risks and overstated the approved uses of the drug, the FDA said. Abbott stopped using the material.

Last year, the FDA required the prescribing labels for Depakote and other anti-epileptic drugs to carry warnings that the drugs increase the risk of suicidal thoughts and behaviors.

Many large drug makers have come under legal scrutiny for their marketing practices in recent years, particularly for "off-label" marketing, or promoting a drug for unapproved uses. Pfizer Inc. (PFE) recently agreed to a record $2.3 billion settlement of government civil and criminal allegations that it illegally promoted the pain drug Bextra and others.

Abbott shares fell 14 cents, to $51.48 in recent trading.

-By Peter Loftus, Dow Jones Newswires; 215-656-8289; peter.loftus@dowjones.com

  (END) Dow Jones Newswires
  11-06-091516ET
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