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Page 14 of 24

October 1, 2018

Pharmaceutical distributor AmerisourceBergen Corporation will pay $625 million to the federal government and 43 states to settle claims that between 2001 and 2014 a pre-filled syringe program at one of its subsidiaries, Medical Initiatives, Inc., violated federal law.  Despite lacking the proper licensing and registration, MII opened FDA-approved sterile vials of oncology drugs, and in a non-sterile environment, pooled the medicine and transfered it into non-FDA approved pre-filled syringes which were then sold to oncology practices and physicians.  This practice allowed Amerisource to capture the "overfill" in the original FDA-approved sterile vials and produce a larger number of pre-filled syringes.  AmerisourceBergen also resolved claims that it provided unlawful kickbacks to physicians to induce them to purchase pre-filled syringes rather than vials.  The settlement resolved three qui tam actions initiated by whistleblowers Michael Mullen, Daniel Sypula, Kelly Hodge, and Omni Healthcare, Inc.; a payment of over $93 million will be made to relators. Previously, in September, 2017, AmerisourceBergen Specialty Group pleaded guilty to illegally distributing misbranded drugs and agreed to pay $260 million in criminal fines and forfeitures. USAO E.D.N.Y.;  NY

Tagged in: CGMP Violation, Dosage Fraud, FCA Federal, FCA State, FDA Fraud, Healthcare Fraud, Multiple Whistleblowers and First-to-File, Off-Label and Unapproved Use, Pharma Fraud, Whistleblower Case, Whistleblower Rewards,

September 27, 2018

A New York-based hedge fund manager, Harbinger Capital Partners Offshore Manager LLC, has agreed to pay $30 million to settle charges that it used fraudulent means to avoid paying both New York State and City taxes. A related investment management company based in Alabama, Harbinger Management Corporation, had earlier settled for $40 million, bringing a total of $70 million recovered in a case first brought to light by a whistleblower filing under the New York False Claims Act. According to the New York Attorney General's office, the alleged fraud had involved listing an office in Alabama as the source of hundreds of millions of dollars earned through fees from successful trades, even though the trades had in fact been made through the New York office and were thus subject to New York taxes. For their role in exposing the fraud, the unnamed whistleblower is to receive a relator's share of $15.4 million. NY AG

Tagged in: FCA State, Tax Fraud, Whistleblower Rewards,

September 12, 2018

A New York based long-term care facility, Centers Plan for Healthy Living, has agreed to pay $1,650,000 to settle allegations that it violated the state and federal False Claims Acts in billing Medicaid for services not provided to Medicaid beneficiaries. The alleged fraud involved enrolling unqualified patients and failing to disenroll recently unqualified patients from a Medicaid-funded care program over the span of two and a half years. It was eventually exposed by an unnamed whistleblower. AG NY; USAO EDNY

Tagged in: FCA Federal, FCA State, Healthcare Fraud, Medical Billing Fraud, Provider Fraud, Whistleblower Case,

September 11, 2018

Through a tip by Connecticut State Comptroller, Kevin Lembo, a Florida-based compounding pharmacy, Assured, Rx, along with multiple individuals—many of them former and current Connecticut state government employees—have been sued by the State of Connecticut for alleged violations of the Connecticut False Claims Act. The pharmacy is accused of paying kickbacks to co-defendants Nicholas and Lisette Maulucci, who then paid other individuals to file reimbursement claims from a state employee health plan for expensive compound drugs manufactured by Assured, Rx. Through their actions, the Mauluccis allegedly received kickbacks totaling upward of $2.6 million, and cost the Connecticut Pharmacy Benefit Plan approximately $10.9 million. CT AG

Tagged in: Anti-Kickback and Stark, Compounding Pharmacy Fraud, FCA State, Pharma Fraud,

August 15, 2018

Post Acute Medical, LLC has agreed to pay $13,031,502 to the United States, $114,016 to Texas, and $22,482 to Louisiana to settle allegations brought on by whistleblower Douglas Johnson that it violated the Anti-Kickback Statute, Physician Self-Referral Law, and state and federal False Claims Acts. The operator of long-term care and rehabilitation hospitals nationwide was accused of cultivating "reciprocal referral relationships" with outside healthcare providers and then billing Medicare and Medicaid for services that arose from those relationships. For his role in exposing the alleged fraud, Johnson will receive a cut of the federal government's share totaling $2,345,670. DOJ

Tagged in: Anti-Kickback and Stark, FCA Federal, FCA State, Hospital Fraud, SNF, Whistleblower Case, Whistleblower Rewards,

August 7, 2018

AstraZeneca, the multinational pharmaceutical giant, has agreed to pay Texas $110 million to settle allegations that the company misleadingly marketed two of its drugs, Crestor and Seroquel, in violation of the Texas Medicaid Fraud Prevention Act. The allegations focused on the company’s off-label marketing in 2010, when it was under a corporate integrity agreement. Former employees of AstraZeneca initiated the case under the whistleblower provisions of the Texas Medicaid Fraud Prevention Act. Texas AG

Tagged in: FCA State, Off-Label and Unapproved Use, Pharma Fraud, Whistleblower Case,

August 3, 2018

A former subcontractor, Andrew Nolan, has pleaded guilty to falsifying quality testing results for the concrete used on the Dulles Metrorail Project. The actual results would have caused the concrete to be rejected in the project, which is partially funded by the Department of Transportation. Nolan is being prosecuted under both the federal False Claims Act and the Virginia Fraud Against Taxpayers Act and faces a maximum of five years in prison. USAO EDVA

Tagged in: Contract Non-Compliance, Defendants, FCA Federal, FCA State, Government Procurement Fraud,

August 3, 2018

J.W. Ancel, Inc. has paid $145,000 to settle allegations that, in the course of constructing a bus facility and building for the Maryland Transit Administration, it billed excessively for work that wasn’t covered in the contract or expressly approved. The case was prosecuted under the Maryland False Claims Act, which was passed only two years before the alleged fraud began in 2013. MD AG

Tagged in: Contract Non-Compliance, FCA State,

August 2, 2018

William Beaumont Hospital will pay $82.74 million to the federal government and $1.76 million to the state of Michigan to settle allegations made by four separate whistleblowers that between 2004 and 2012 it paid doctors above fair market value and provided them with perks such as free or discounted office space in return for patient referrals. Beaumont also allegedly falsely claimed that a CT radiology center qualified as an outpatient department. Beaumont has now entered into a five-year Corporate Integrity Agreement with the Department of Health and Human Services Office of Inspector General. It is not yet determined how much money the four whistleblowers will receive. DOJ

Tagged in: Anti-Kickback and Stark, FCA Federal, FCA State, Healthcare Fraud, Hospital Fraud, Whistleblower Case, Whistleblower Rewards,

August 1, 2018

Early Autism Project, Inc. (“EAP”) agreed to pay the United States $8,833,615 to settle allegations brought by whistleblower and former employee of EAP, Olivia Zeigler, that it submitted false claims to TRICARE (a military insurance program) and South Carolina’s Medicaid program for therapy services for children with autism. The therapy services were misrepresented or were never provided. EAP allegedly also created a program under which it billed Medicaid for functions that were not related to therapy services at all and permitted its therapists to regularly bill for more hours than they actually provided therapy services. Olivia Zeigler will be awarded $435,000. DOJ

Tagged in: FCA Federal, FCA State, Medicaid, Medical Billing Fraud, Other Government Health Programs, Provider Fraud, Whistleblower Case, Whistleblower Rewards,

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