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Page 120 of 129

January 9, 2015

Global pharmaceutical company Daiichi Sankyo Inc. agreed to pay $39 million to resolve allegations it violated the False Claims Act by paying kickbacks to induce physicians to prescribe Daiichi drugs, including Azor, Benicar, Tribenzor and Welchol. According to the government, Daiichi paid physicians improper kickbacks in the form of speaker fees as part of Daiichi’s Physician Organization and Discussion programs which were often just lavish dinners with the speaking physicians’ own medical group or staff. The charges originated with a whistleblower lawsuit filed by former Daiichi sales representative Kathy Fragoules under the whistleblower provisions of the False Claims Act. She will receive a whistleblower award of $6.1 million. DOJ

December 19, 2014

Lockheed Martin subsidiary Lockheed Martin Integrated Systems agreed to pay $27.5M to resolve allegations it violated the False Claims Act by overbilling the government on US Army contracts for work in Iraq and Afghanistan. DOJ

December 19, 2014

Boston-based records storage company Iron Mountain agreed to pay $44.5M to resolve allegations it violated the False Claims Act by overcharging federal agencies for record storage services under General Services Administration (GSA) contracts. The charges originated with a whistleblower lawsuit filed under the qui tam provisions of the False Claims Act by Brent Stanley, a former Iron Mountain employee, and Patrick McKillop, who worked in the records management industry. Collectively, they will receive a whistleblower reward of $8M. DOJ

December 15, 2014

Alaska and Virginia-based technology contractors Eyak Technology LLC and Eyak Services LLC agreed to pay $2.5M to settle charges of alleged False Claims Act and Anti-Kickback Act violations. According to the government, from 2005 to 2011 EyakTek held a $1 billion prime contract with the U.S. Army Corps of Engineers and EyakTek’s then-director of contracts, Harold Babb, accepted kickbacks from several subcontractors of EyakTek and ESL in return for using his position to direct subcontracts to them. In March 2012, Babb pleaded guilty to bribery and kickback charges and was sentenced to 87 months in prison and to pay more than $9M. DOJ

December 8, 2014

Medical products manufacturer OtisMed Corp and its former CEO Charlie Chi admitted to intentionally distributing knee replacement surgery cutting guides (called the OtisKnee) after the Food and Drug Administration (FDA) had rejected their application for marketing clearance. OtisMed agreed to pay more than $80M to resolve its related criminal and civil liability for distributing an adulterated medical device in violation of the Food, Drug, and Cosmetic Act (FDCA), and submitting fraudulent claims in violation of the False Claims Act. Whistleblower Insider

December 3, 2014

Rite Aid Corporation agreed to pay $3M to resolve allegations it violated the False Claims Act by offering illegal inducements to Medicare and Medicaid beneficiaries to transfer their prescriptions to Rite Aid pharmacies. The government alleged that from 2008 to 2010, Rite Aid had improperly influenced the decisions of Medicare and Medicaid beneficiaries to transfer their prescriptions to Rite Aid pharmacies by offering them gift cards in exchange for their business. The charges originated in a whistleblower complaint filed by Jack Chin under the qui tam provisions of the False Claims Act. Chin will receive a whistleblower award of approximately $500,000. DOJ

December 1, 2014

Maricopa County Community College District (MCCCD) agreed to pay $4M to resolve allegations under the False Claims Act that it submitted false claims to the Corporation for National and Community Service concerning AmeriCorps state and national grants. The allegations first arose from a whistleblower lawsuit filed by MCCCD employee Christine Hunt under the qui tam provisions of the False Claims Act. She will receive a whistleblower award of $775,827. DOJ

December 1, 2014

North Atlantic Medical Services Inc., doing business as Regional Home Care Inc., agreed to pay $852,378 to resolve allegations it violated the False Claims Act by submitting claims to Medicare and Medicaid for respiratory therapy services provided by unlicensed personnel. NAMS is a medical device company based in Massachusetts that provides equipment and services for the treatment of respiratory ailments, such as oxygen deficiency and sleep apnea. According to the government, from September 2010 to January 2013, NAMS used unlicensed employees to set up sleep apnea masks and oxygen therapy equipment for patients in Massachusetts. The charges were initiated by former NAMS employees Konstantinos Gakis and Demetri Papageorgiou who filed a whistleblower action under the qui tamprovisions of the False Claims Act. They will receive a whistleblower award of $153,428. DOJ

November 12, 2014

Home healthcare agency CareAll Management LLC agreed to pay $25M to settle charges it violated the False Claims Act by submitting false and upcoded home healthcare billings to Medicare and Medicaid. According to the government, between 2006 and 2013, CareAll overstated the severity of patients’ conditions to increase billings and billed for services that were not medically necessary and rendered to patients who were not homebound. The current allegations first arose in a whistleblower lawsuit filed by Toney Gonzales under the qui tam provisions of the False Claims Act.  Gonzales will receive a whistleblower award in an undisclosed amount.  Whistleblower Insider

November 6, 2014

Medical device maker Biotronik Inc. agreed to pay $4.9M to resolve allegations it violated the False Claims Act by paying kickbacks to induce physicians to use its products. Specifically, the government charged that Biotronik induced electrophysiologists and cardiologists practicing in Nevada and Arizona to use Biotronik pacemakers, defibrillators and cardiac resynchronization therapy devices by paying them in the form of repeated meals at expensive restaurants and inflated payments for membership on a physician advisory board. The allegations first arose in a whistleblower lawsuit filed by a former Biotronik employee, Brian Sant, under the qui tam provisions of the False Claims Act. Sant will receive a whistleblower award of $840,000. DOJ
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