- GlaxoSmithKline False Claims Act Suit to Settle for $3 Billion
- July 31, 2012
- Law Firm: Berger Montague P.C. - Philadelphia Office
What was the lawsuit about?
Pharmaceutical company, GlaxoSmithKline has agreed to pay $3 billion in fines to settle criminal and civil violations. This is the largest health care fraud settlement to date in the United States. The qui tam portion of the civil lawsuit arose under the False Claims Act and is said to be worth over $1 billion. At issue in the civil suit were claims relating to the company's medications, including Paxil, Wellbutrin, Advair, Lamictal, Zofran, Imitrex, Lotronex, Flovent, Valtrex, and Avandia. The alleged violations included promoting the medications for off-label marketing and unapproved purposes, misleading reports on treatment guidelines, false representations of drug safety, reporting false drug prices, and kickbacks paid to promote the drugs. As a result, claims based on these activities were submitted to the federal government in violation of the False Claims Act.
What happened in the qui tam lawsuit?
The suit involved a number of different issues brought together from various lawsuits. In the case of promoting unapproved uses and kickbacks, four independently-filed, qui tam lawsuits were consolidated into a single suit. Once filed, a host of federal agencies investigated the fraud including: the Department of Health and Human Services, the Food and Drug Administration, the Department of Defense, the Office of Personnel Management, the Department of Veterans Affairs, the Department of Labor, TRICARE Program Integrity, the U.S. Postal Service, and the FBI. The civil suit involved three specific types of alleged fraud: the qui tam claims of off-label/non-covered promotion of medication and kickbacks to doctors for prescriptions; making false and misleading safety statements about Avandia; and reporting false best prices, which led to underpaying Medicaid rebates.
What does the settlement mean for the FCA, Qui Tam lawyers, and whistleblowers?
The qui tam portion of the lawsuit settled for over $1 billion, of which individual whistleblowers from the four original suits may receive a portion. The U.S. Department of Justice is calling this settlement "part of the government's emphasis on combating health care fraud and another step for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative." The HEAT initiative was set up specifically to combat Medicare and Medicaid fraud, resulting in over ten billion dollars in recoveries since 2009. A main driver of the suits filed through the HEAT initiative is the FCA, meaning that qui tam lawyers will see increased business as whistleblowers stand to recover a significant amount of money in rewards for filing qui tam lawsuits.