A federal court in Massachusetts Sept. 15 allowed a whistleblower lawsuit against Amgen Inc. to continue, finding that pleadings alleging the biotech drug company violated the anti-kickback statute form a proper foundation for filing a False Claims Act lawsuit (United States ex rel. Westmoreland v. Amgen Inc., D. Mass., No. 1:06-cv-10972-WGY, 9/15/11).
The U.S. District Court for the District of Massachusetts denied Amgen’s partial motion for summary judgment against whistleblower Kassie Westmoreland, a former Amgen employee.
Amgen contended that because the Medicare statute does not mention compliance with the anti-kickback law as a precondition of payment, Congress meant to preclude it as a foundation for an FCA claim, the court said.
Further, Amgen argued that the certification of compliance, which all Medicare participants must sign to receive reimbursement, should only affect continued participation in the Medicare program, not FCA liability, the court said.
“Defendants’ argument is effectively a challenge to the validity of the contractual term making compliance with the Anti-Kickback Statute a precondition of [Medicare] payment,” the court said.
Amgen’s Argument an ‘Absurdity.’
Read more here.
CINCINNATI—A Louisville, Ky., physician has paid the government $349,860 to settle
a qui tam action alleging Medicare fraud, the Department of Justice announced Sept. 27.
Dr. Steven H. Stern and his practice, Kentuckiana Center for Better Bone and Joint Health, falsely billed Medicare for Infliximab infusions, according to a former KCB employee who filed the whistleblower lawsuit in 2007.
Stern and KCB were accused of splitting vials of the rheumatoid arthritis drug across multiple patients, then billing Medicare as if a whole vial was used for each patient. Overbilling occurred from December 2003 through December 2006, according to the qui tam complaint.
The whistleblower’s share of the settlement is $70,000. In addition to the government payment, the agreement directs Stern to pay $13, 635 for legal fees and expenses incurred by the whistleblower.
Although just announced, a spokeswoman for the U.S. Attorney for the Western District of Kentucky told BNA Sept. 29 that the settlement was paid August 26.
“This case illustrates the importance and value of whistleblower lawsuits under the False Claims Act,” U.S. Attorney David J. Hale said. “Because this employee stepped forward to report suspected double-billing of Medicare, we have been able to stop a practice that we believe was costing taxpayers hundreds of thousands of dollars.”
A federal jury in California Aug. 19 awarded a fired Walgreens pharmacist more than $1.2 million—mostly in punitive damages—after finding that his complaints the pharmacy chain was engaged in fraudulent Medicare billing practices were a “motivating factor” in his termination (Mitri v. Walgreen Co. Inc., E.D. Cal., No. 1:10-cv-538-AWI-SKO, damage award 8/19/11).
The jury, in two separate phases, awarded Sami Mitri, who began working as a pharmacist for Walgreen Co. in the Fresno, Calif., area in 1996, past and future economic losses totaling $88,000, and punitive damages of $1.16 million.
The panel also answered affirmatively that his complaints regarding the billing practices constituted a motivating factor in the company’s decision to terminate him, and decided that Walgreens would not have fired Mitri if the company had not considered those billing fraud complaints.
The jury also found that the company’s conduct constituted “malice, oppression or fraud,” and that the conduct was committed by one or more officers, directors, or managing agents of the pharmacy chain.
Johnson & Johnson said in an Aug. 9 securities filing that it has reached an agreement with the government on resolving criminal charges related to the promotion of the antipsychotic drug Risperdal.
In a 10-Q filing with securities regulators, the company said that discussions “have been ongoing in an effort to resolve criminal penalties under the Food Drug and Cosmetic Act related to the promotion” of Risperdal (risperidone).
The company said an agreement in principle “on key issues relevant to a disposition of criminal charges pursuant to a single misdemeanor violation” of the food and drug law has been reached, but “certain issues remain open before a settlement can be finalized.”
A Connecticut hospital said Aug. 10 it has entered into a civil settlement agreement with the federal government under which it will pay $516,527 to resolve allegations that it improperly charged Medicare for patient injections of the drug Lupron.
Federal prosecutors allege that St. Francis Hospital and Medical Center in Hartford improperly billed Medicare in violation of the False Claims Act for injections of leuprolide acetate, known by the brand name Lupron or Lupron Depot. The Department of Justice also announced the settlement Aug. 10.
TAMPA, Fla.—The Department of Justice June 14 announced it has intervened in a whistleblower lawsuit alleging a Florida sleep clinic violated the False Claims Act by billing Medicare and TRICARE for tests performed by uncertified technicians
In an intervenor’s complaint filed in Tampa in U.S. District Court for the Middle District of Florida, the government named as defendants Bay Area Sleep Associates LLC, which operates as SomnoMedics LLC, and its owner, Edward Killmer Jr.
The defendants operate 10 sleep laboratories throughout central Florida, the complaint noted.
The qui tam case alleges the defendants violated the False Claims Act by hiring unlicensed technicians to perform sleep tests, knowing that Medicare reimbursement regulations required diagnostic testing services at independent diagnostic testing facilities such as SomnoMedics be performed by a technician licensed or certified by a state or national credentialing body, DOJ said in a statement.
Prosecutors told a conference audience June 7 that U.S. enforcement trends show a shifting from pharmaceutical drugs to biologics, biotechnology, and medical devices and that the Food and Drug Administration and the Department of Justice are actively pursuing cases involving the individual liability of executives.
The U.S. subsidiary of Belgian pharmaceutical manufacturer UCB SA has pleaded guilty to the off-label promotion of its epilepsy drug Keppra and will pay more than $34 million to resolve criminal and civil liability, the Department of Justice said June 9 (United States v. UCB Inc., D.D.C., No. 1:11-375-RMU, guilty plea 6/9/11).