Pharmaceutical fraud

A settlement has been reached in a whistleblower class action lawsuit brought against Victory Pharma Inc who is accused of paying kickbacks to doctors to induce them to write prescriptions for Naprelan, Xodol, Fexmid and Dolgic, for patients covered by Medicare and other federal health insurance programs.

The whistleblower will receive $1.7 million of the government's recovery.

The government's complaint was filed in 2012 stemming from an earlier filed suit filed by the whistleblower.  The United States alleged that Victory engaged in a scheme to promote its drugs by paying kickbacks to doctors to induce them to write prescriptions for Victory’s products, including prescriptions for patients covered by Medicare and other federal health insurance programs. The kickbacks included tickets to professional and collegiate sporting events; tickets to concerts and plays; spa outings; golf and ski outings; dinners at expensive restaurants; and numerous other out-of-office events. Victory also encouraged its sales representatives to schedule paid “preceptorships,” which involved sales representatives “shadowing” doctors in their offices. The settlement also resolves allegations that Victory improperly used these preceptorships to induce doctors to prescribe Victory’s products.

A settlement has been reached in a whistleblower class action lawsuit brought against Par Pharmaceutical Companies Inc who is accused of promotion of its prescription drug Megace ES for uses not approved as safe and effective by the Food and Drug Administration (FDA) and not covered by federal health care programs.

A federal court judge fined Par $18 million and ordered $4.5 million in criminal forfeiture. Par also agreed to pay $22.5 million to resolve its civil liability. Although the settlement reached in this lawsuit was based upon three filed whistleblower cases, the only disclosed whistleblower recovery was paid to the two whistleblowers that filed the intial case in 2009.  They  will receive $4.4 million of the federal recovery.

The United Staes civil allegations were that Par, by promoting the sale and use of Megace ES for uses that were not FDA-approved and not covered by Federal health care programs, caused false claims to be submitted to these programs. The United States further alleged that Par deliberately and improperly targeted sales to elderly nursing home residents with weight loss, whether or not such patients suffered from AIDS, and launched a long-term care sales force to market to this population. During this marketing campaign, Par was allegedly aware of adverse side effects associated with the use of megestrol acetate in elderly patients, including an increased risk of deep vein thrombosis, toxic reactions in elderly patients with impaired renal function, and mortality. The United States alleged that Par made unsubstantiated and misleading representations about the superiority of Megace ES over generic megestrol acetate for elderly patients to encourage providers to switch patients from generic megestrol acetate to MegaceES, despite having conducted no well-controlled studies to support a claim of greater efficacy for Megace ES. Except as admitted in the plea agreement, the claims settled by the civil settlement agreement are allegations only, and there has been no determination of liability as to those claims.

A settlement has been reached in a whistleblower class action lawsuit brought against Ranbaxy USA Inc. , a subsidiary of Indian generic pharmaceutical manufacturer Ranbaxy Laboratories Limited, who is accused of causing false claims to be submitted to government health care programs.

Ranbaxy plead guilty to felony charges relating to the manufacture and distribution of certain adulterated drugs made at two of Ranbaxy’s manufacturing facilities in India. Ranbaxy also agreed to pay a criminal fine and forfeiture totaling $150 million and to settle civil claims under the False Claims Act and related State laws for $350 million. The federal government’s share of the civil settlement amount is approximately $231.8 million, and the remaining $118.2 million will go to the states participating in the agreement. The whistleblower will receive approximately $48.6 million from the federal share of the settlement amount.

The government's complaint stemmed from a whistleblower lawsuit that was filed in April 2007.  The government alleged that between April 1, 2003, and September 16, 2010, Ranbaxy manufactured, distributed, and sold drugs whose strength, purity, or quality differed from the drug’s specifications or that were not manufactured according to the FDA-approved formulation. The United States further contends that, as a result, Ranbaxy knowingly caused false claims for those drugs to be submitted to Medicaid, Medicare, TRICARE, the Federal Employees Health Benefits Program, the Department of Veterans Affairs, and the U.S. Agency for International Development (USAID), which administers the U.S. President’s Emergency Plan for AIDS Relief (PEPFAR).

A settlement has been reached in a whistleblower class action lawsuit brought against CR Bard Inc who is accused of knowingly caused false claims to be submitted to the Medicare program for brachytherapy seeds used to treat prostate cancer.

The whistleblower will receive $10,134,600 as her share of the civil settlement. In addition, according to a non-prosecution agreement with the United States, Bard has agreed to pay an additional $2.2 million and to take numerous remedial steps, many of which the company identified and began to implement prior to the criminal investigation, to enhance its corporate compliance program to prevent similar illegal actions in the future.

The whistleblower case was filed January 2006.  The government's claims were that, from 1998 to 2006, Bard provided illegal remuneration to customers and physicians to induce them to purchase Bard’s seeds, in violation of the Anti-Kickback Statute.   The illegal remuneration allegedly took the form of certain grants, guaranteed minimum rebates, conference fees, marketing assistance and/or free medical equipment that Bard paid to customers and/or physicians who used the seeds to perform treatment for prostate cancer.   Hospitals ultimately submitted bills to Medicare for these seeds, which the government alleged were rendered false by Bard’s illegal kickback activity. The government alleged that Bard was liable under the False Claims Act for causing the submission of those false claims.

A settlement has been reached in a whistleblower class action lawsuit brought against ISTA Pharmaceuticals Inc who is accused of conspiring to illegally introduce a misbranded drug, Xibrom, into interstate commerce.

ISTA pled guilty in the Western District of New York to criminal charges that the company conspired to illegally introduce a misbranded drug, Xibrom, into interstate commerce.  Under the Food, Drug and Cosmetic Act (FDCA), it is illegal for a drug company to introduce into interstate commerce any drug that the company intends will be used for uses not approved by the Food and Drug Administration (FDA).  Xibrom is an ophthalmic, nonsteroidal, anti-inflammatory drug that was approved by FDA to treat pain and inflammation following cataract surgery.  In order to expand sales of Xibrom outside of its approved use, ISTA conspired to introduce misbranded Xibrom into interstate commerce.  

Under the terms of the plea agreement, ISTA will pay a total of $18.5 million, including a criminal fine of $16,125,000 for the conspiracy to introduce misbranded Xibrom into interstate commerce, $500,000 for the conspiracy to violate the Anti-Kickback Statute, and $1,850,000 in asset forfeiture associated with the misbranding charge. 

ISTA also entered into a civil settlement agreement under which it agreed to pay $15 million to the federal government and states to resolve claims arising from its marketing of Xibrom, which caused false claims to be submitted to government health care programs.  The civil settlement resolved allegations that ISTA promoted the sale and use of Xibrom for certain uses that were not FDA-approved and not covered by the Federal health care programs, including prevention and treatment of cystoid macular edema, treatment of pain and inflammation associated with non-cataract eye surgery, and treatment of glaucoma.  The United States further alleged that ISTA's violations of the Anti-Kickback Statute resulted in false claims being submitted to federal health care programs.  The federal share of the civil settlement is $14,609,746.16, and the state Medicaid share of the civil settlement is $390,253.84.  Except as admitted in the plea agreement, the claims settled by the civil settlement agreement are allegations only, and there has been no determination of liability as to those claims. 

The government's allegations stem from two lawsuits filed under the whistleblower provisions of the False Claims Act. The whistleblower will receive approximately $2.5 million of the government's reocvery.

A settlement has been reached in a whistleblower class action lawsuit brought against Genzyme Corp who is accused of marketing, and causing false claims to be submitted to federal and state health care programs for use of, a “slurry” version of its Seprafilm adhesion barrier.

The whistleblowers' share of the settlement has not been determined.

The government's case is based upon the filing of two different whistleblower cases, the first of which was filed in July 2009.  The complaint alleged that Genzyme sales representatives taught doctors and other staff to cut the Seprafilm sheets into small pieces, add saline and allow the pieces to dissolve until the desired consistency was reached.  This mixture was referred to as “slurry.”  Genzyme sales representatives traded recipes for slurry, and trained each other in how to create it.  The slurry was used in laparoscopic or “key hole” surgeries by inserting a catheter filled with the mixture into the body and squirting it into the abdominal cavity.  Seprafilm is FDA-approved for use in open abdominal surgery but not for minimally invasive surgeries, such as laparoscopic or key hole surgery.  Allegedly, as a result of this conduct, Genzyme knowingly caused hospitals and other purchasers of Seprafilm to submit false and fraudulent claims to federal health care programs for uses of Seprafilm that were not reimbursable.

A settlement has been reached in a whistleblower class action lawsuit brought against CareFusion Corp who is accused of paying kickbacks and promoting its products for uses that were not approved by the Food and Drug Administration.

The whistleblower's share in this case is $3.26 million.

The originally filed lawsuit began in September 2010.  The government's case against CareFusion alleged that,  under agreements entered into in 2008 by CareFusion’s predecessor, CareFusion paid $11.6 million in kickbacks to Dr. Charles Denham while Denham served as the co-chair of the Safe Practices Committee at the National Quality Forum.  National Quality Forum is a non-profit organization that reviews, endorses and recommends standardized health care performance measures and practices.  The government contends that the purpose of those payments was to induce Denham to recommend, promote and arrange for the purchase of ChloraPrep by health care providers.  ChloraPrep has been approved by the Food and Drug Administration for the preparation of a patient’s skin prior to surgery or injection. 

The complaint further made claims that, during the period between September 2009 and August 2011, CareFusion knowingly promoted the sale of ChloraPrep for uses that were not approved by the Food and Drug Administration, some of which were not medically accepted indications, and made unsubstantiated representations about the appropriate uses of ChloraPrep.