Eli Lilly and Co is expected to agree as soon as Thursday to pay $1.4 billion to settle criminal and civil charges that it illegally marketed its antipsychotic drug Zyprexa for unauthorized use in patients vulnerable to its risky side effects, the New York Times said.
Details of the agreement were provided by people involved in the negotiations, the paper said.
No-one at Eli Lilly could immediately be reached for comment by Reuters.
In October the drugmaker posted a third-quarter loss as it booked $1.5 billion in charges for probes relating to Zyprexa.
The company has faced long-running accusations by various states that it improperly marketed Zyprexa to patients who were not approved users and that it played down side effects such as weight gain, which can increase the risk of diabetes.
While doctors are free to prescribe drugs in any way they see fit, drug companies may promote them only for uses approved by U.S. health regulators.
The U.S. Attorney's Office in Philadelphia launched a probe into the matter in 2004 and Lilly received a grand jury subpoena for Zyprexa-related documents in November.