By: Allan M. Siegel
Of all the hundreds of millions of dollars in whistleblower recoveries
obtained by the Department of Justice in 2015, the Novartis settlement
stood apart. In November 2015, the DOJ announced a $390 million settlement
with Novartis Pharmaceuticals. The case began as a whistleblower lawsuit
that alleged the Swiss pharmaceutical company violated the False Claims
Act and the Anti-Kickback Statute.
The lawsuit alleged that Novartis paid pharmacies to recommend two of its
drugs: Exjade, which is an iron reduction treatment for people who undergo
blood transfusions, and Myfortic, a drug used by kidney transplant patients
to decrease the threat of organ rejection.
The DOJ specifically alleged that Novartis gave kickbacks to specialty
pharmacies Bioscrip and Accredo by providing patient referrals and rebates
in return for recommendations of Exjade prescription refills. The whistleblower
lawsuit alleged that Novartis pressured pharmacies to downplay Exjade’s
life-threatening side effects while emphasizing the drug’s benefits.
The federal government also charged Novartis with giving rebates to pharmacies
to recommend that patients switch from competitor drugs to Novartis’
As part of the settlement, Novartis agreed to:
- Pay $370 million to resolve False Claims Act allegations with $286.9 million
paid to the federal government and $83.1 million to state governments.
- Forfeit $20 million under the federal civil forfeiture laws.
- Make admissions about Novartis’ relationship with specialty pharmacies.
- Change its corporate integrity agreement with the U.S. Department of Health
and Human Services’ Office of Inspector General so that Novartis
must undergo an independent review and extend the agreement for an additional
Novartis’ $390 million settlement was the largest
whistleblower case of 2015. Millennium Health’s $256 million settlement was the
second-largest qui tam case. Whistleblowers who file a claim under the
False Claims Act are eligible to receive between 15 and 30 percent of
a whistleblower recovery.
Although the attorneys of Chaikin, Sherman, Cammarata & Siegel, P.C.
did not represent the whistleblowers in the Novartis case, our whistleblower
attorneys are experienced and able to handle similar claims. If you have
original, non-public information about a pharmaceutical company paying
kickbacks to a pharmacy, hospital, or other health service provider, please
contact us immediately for a free, confidential consultation. Because strict deadlines
apply to filing a whistleblower claim, we recommend getting in touch at
your earliest convenience.