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Pharma Fraud

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June 25, 2014

Ohio-based Omnicare Inc., the country’s largest provider of pharmaceuticals and pharmacy services to nursing homes, agreed to pay $124 million to settle government charges of offering improper financial incentives to skilled nursing facilities in return for their continued selection of Omnicare to supply drugs to their elderly Medicare and Medicaid patients. Donald Gale, former employee of Omnicare Inc., will receive a whistleblower award of roughly $17M from the settlementDOJ

June 4, 2014

New York Attorney General Eric T. Schneiderman announced he, along with 43 other State Attorneys General and the District of Columbia, reached a $105M settlement with GlaxoSmithKline, LLC (GSK) arising from alleged improper marketing and promotion of the asthma drug Advair and the anti-depressant drugs Paxil and Wellbutrin. New York’s share of the settlement is over $4.1M. NYAG

April 16, 2014

Drug manufacturer Astellas Pharma US agreed to pay $7.3 million to resolve allegations it violated the False Claims Act in connection with its marketing and promotion of the drug Mycamine for pediatric use when the drug did not have FDA approval for such use.  The allegations were first raised in a qui tam lawsuit filed by Frank Smith, a former Astellas sales representative, under the whistleblower provisions of the False Claims Act.  He will receive a whistleblower award of $708,852.  DOJ

Another Preemption Decision Sheltering Drug Makers from Liability

Posted  07/24/13
By Marlene Koury Pharmaceutical companies are on a roll.  They continue to prevail in court by relying on the preemption doctrine to block injured consumers from suing over defective drugs.  First, in the recent Mutual Pharmaceutical v. Bartlett and PLIVA v. Mensing decisions, the Supreme Court held that federal law bars suits against generic drug companies for defects in the design or labeling of their...

Supreme Court Further Limits Liability of Generics for Faulty Drugs

Posted  07/3/13
By Gordon Schnell In what is being hailed as a major victory for generic drug makers (but not necessarily for consumers), the Supreme Court ruled last week that these companies cannot be held liable for defects in the design of their products.  The decision follows from the Court's 2011 ruling that similarly shielded the generics from liability for inadequate safety warnings on their drug labels.  Taken together,...

Pharmaceutical Case Presents Novel Use of False Claims Act

Posted  05/1/13
(As reported in Thomson Reuters) When you think of a whistleblower, you might think of an employee reporting on the misconduct of some giant corporate employer -- a David versus Goliath scenario.  On Friday, Reuters reminded us that this is not always the case, reporting on a False Claims Act lawsuit brought by a very different kind of whistleblower -- a corporate competitor.  In this case, Amphastar...

High Court to Hear Argument on Whether Injured Patients Can Hold Generic Drug Makers Accountable for Their Defective Drugs

Posted  03/13/13
By Jason Enzler Next Tuesday the Supreme Court is scheduled to hear oral argument on Mutual Pharmaceutical’s appeal of a $21 million jury award for serious injuries caused by one of its generic drugs.  Much more is at stake than the money, however, with many expecting the Justices to set out a broad rule on whether any patient can sue a generic drug maker for defects in the design of its drug. The underlying...

Stiff Amgen Fine Shows No Slowing Down in Government Prosecution of Off-Label Marketing

Posted  12/20/12
By Gordon Schnell It was only two weeks ago that the Second Circuit Court of Appeals came down with its groundbreaking decision in U.S. v. Caronia.  In a 2-to-1 ruling by a three-judge panel, the appeals court overturned the conviction of a drug company sales representative for promoting a prescription drug for uses not approved by the FDA.  The majority reasoned that banning such off-label marketing violated the...

CVS Sub Caught Duping Consumers in Prescription Drug Purchases

Posted  10/22/12
By Marlene Koury In one of the first False Claims Act settlements involving Medicare's "Part D" prescription drug program, CVS Caremark subsidiary, RxAmerica, agreed to pony up $5.25 million to resolve charges that it submitted false pricing information to the Centers for Medicare & Medicaid Services (CMS).  This is the government body that oversees the Medicare and Medicaid programs.  It also makes available the...

The Fraud Behind the Fraud of Off-Label Drug Marketing

Posted  10/5/12
By Gordon Schnell It has been one of the most common means for drug companies to get around what can be the very rigorous and time-consuming process of securing FDA approval for selling drugs.  That is, taking drugs that the FDA has approved as safe and effective for one particular use and marketing them to the medical community and the public for an entirely different set of uses.  This so-called off-label...
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