Drug Promoting and Marketing Error Costs Shire Pharmaceuticals $56.5 Million

Shire Pharmaceuticals LLC to Pay $56.5 Million to Resolve False Claims Act Allegations Relating to Drug Marketing and Promotion Practices

 

 

Pharmaceutical company Shire Pharmaceuticals LLC will pay $56.5 million to settle civil allegations that it violated the False Claims Act as a result of its marketing and promotion of several drugs.Shire, located in Wayne, Pennsylvania, manufactures and sells pharmaceuticals, including Adderall XR, Vyvanse and Daytrana, which are approved for the treatment of attention deficit hyperactivity disorder (ADHD), and Pentasa and Lialda, which are approved for the treatment of mild to moderate active ulcerative colitis.

 

“Patients and health care providers must receive accurate information about available prescription drugs so that they can make safe and informed treatment decisions,” said Acting Assistant Attorney General Joyce R. Branda for the Justice Department’s Civil Division.  “The Department of Justice will be vigilant to hold accountable pharmaceutical companies that provide misleading information regarding a drug’s safety or efficacy.”

The settlement resolves allegations that, between January 2004 and December 2007, Shire promoted Adderall XR for certain uses despite a lack of clinical data to support such claims and overstated the efficacy of Adderall XR, particularly relative to other ADHD drugs.  Among the allegedly unsupported claims was that Adderall XR was clinically superior to other ADHD drugs because it would “normalize” its recipients. Shire allegedly stated that its competitors’ products could not achieve similar results, which the government contended was not shown in the clinical data that Shire collected.  Shire also allegedly marketed Adderall XR based on unsupported claims that Adderall XR would prevent poor academic performance, loss of employment, criminal behavior, traffic accidents and sexually transmitted disease.  In addition, Shire allegedly promoted Adderall XR for the treatment of conduct disorder without approval from the Food and Drug Administration (FDA).

The settlement also resolves allegations that, between February 2007 and September 2010, Shire sales representatives and other agents allegedly made false and misleading statements about the efficacy and “abuseability” of Vyvanse to state Medicaid formulary committees and to individual physicians.

  For example, one Shire medical science liaison allegedly told a state formulary board that Vyvanse “provides less abuse liability” than “every other long-acting release mechanism” on the market. 

Shire also made allegedly unsupported claims that treatment with Vyvanse would prevent car accidents, divorce, arrests and unemployment. 

Finally, the settlement resolves allegations that between January 2006 and June 2010, Shire sales representatives promoted Lialda and Pentasa for off-label uses not approved by the FDA and not covered by federal healthcare programs.  Specifically, the government alleged that Shire promoted Lialda off-label for the prevention of colorectal cancer.

"This settlement represents another important step in our fight against fraud in federally-funded healthcare programs such as Medicare and Medicaid,” said U.S. Attorney Zachary T. Fardon for the Northern District of Illinois.  

The allegations resolved by the settlement arose from a lawsuit filed by Dr. Gerardo Torres, a former Shire executive, and a separate lawsuit filed by Anita Hsieh, Kara Harris and Ian Clark, former Shire sales representatives.  The lawsuits were filed under the False Claims Act’s whistleblower provisions, which permit private parties to sue for false claims on behalf of the government and to share in any recovery.  Torres will receive $5.9 million.   

 

As a result of today’s $56.5 million settlement, the federal government will receive $35,713,965, and state Medicaid programs will receive $20,786,034.  The Medicaid program is funded jointly by the federal and state governments.  In addition, Shire has separately reached agreement with the U.S. Department of Health and Human Services-Office of the Inspector General (HHS-OIG) on a corporate integrity agreement, which will address the company’s future marketing efforts.

 

 

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Mortgage Fraud Still Happening

If you thought the bad guys had left the mortgage business for greener pastures, think again. The thieves are still out there, ready to separate you from your money. But at the same time, many of us are still not above stretching the truth a little when we are trying to obtain financing.

First, the business bad guys, represented today by Amerisave Mortgage Corp., which the Consumer Financial Protection Bureau has ordered to pay $19.3 million for providing a deceptive bait-and-switch scheme on would-be borrowers.



The CFPB found that the Atlanta-based online company, which lends in all 50 states, lured consumers by advertising misleading interest rates. Then locked them in with costly up-front fees, failed to honor its published rates and illegally overcharged them for affiliated third-party services.

Here's how it worked, according to the CFPB:

Since 2011, the company advertised inaccurate rates and terms in online banner ads and searchable rate tables on third-party websites, inducing consumers to pursue a mortgage with Amerisave. Once at Amerisave's website, consumers received quotes based on an 800 FICO score, even when they had previously entered a score well below 800 on the third-party site that led them to Amerisave in the first place.

The company also required consumers to pay for an appraisal before it would provide a good-faith estimate; then it ordered the appraisal from an affiliated company. Borrowers weren't told that tiny fact until later.

Then, at closing, Amerisave charged its customers for something called "appraisal validation" reports without disclosing that the service was provided by an affiliated company. They also weren't told the fee was marked up by as much as 900%.

In its investigation, the CFPB found that Amerisave and its owner, Patrick Markert, pocketed more than $3 million in indirect profit distributions by overcharging unknowing borrowers. The validation reports cost $20, but Amerisave charged $100, with the $80 windfall finding its way to Markert's wallet.

Whistleblower Settlements Summary 2014

There were a number of settlements and verdicts around the country in whistleblower cases in August. This is an area of litigation that is expanding rapidly.



COMMUNITY HEALTH SYSTEMS TO PAY $98 MILLION IN SETTLEMENT

The nation’s largest operator of acute care hospitals, Community Health Systems, Inc., has agreed to pay $98 million to settle claims that the company billed government health care programs for inpatient services that should have been billed as significantly less expensive outpatient or observation services. CHS was said to have engaged in a corporate-driven scheme to increase inpatient admissions of Medicare, Medicaid and TRICARE beneficiaries older than 65. The government further claimed that the inpatient admissions were not medically necessary and should have been provided in a less costly outpatient or observation setting.

The settlement resolves lawsuits filed by several whistleblowers under the qui tam provisions of the False Claims Act. Since January 2009, the Justice Department has recovered more than $20.2 billion through False Claims Act cases.


MCKESSON TO PAY $18 MILLION TO END CDC DRUG SHIPMENT CLAIMS

Pharmaceutical distributor McKesson Corp. will pay $18 million to settle whistleblower claims that it improperly set temperature monitors outside contractual limits when shipping vaccines for the Centers for Disease Control and Prevention . The U.S. Department of Justice announced the settlement on August 8. San Francisco-based McKesson signed a contract with the CDC in 2007 requiring it to set electronic devices in shipping containers to detect whether temperatures strayed outside a slim range just above freezing. The False Claims Act suit, filed by a former financial director, alleged the company instead set the monitors for a much wider range that would have allowed vaccines to freeze or reach room temperature without alerting personnel.

The CDC said the monitors were a backup system and that the vaccines were properly packed in insulated containers and transported at the right temperatures. McKesson maintained that the temperature monitors complied with the contract. The relator in the lawsuit, Terrell Fox, alleged that from April to November, McKesson shipped vaccines from manufacturers to health care providers and set monitors to go off only if the vaccines were colder than -1 degree Celsius and warmer than 25 degrees.
It was alleged that the vaccines were supposed to stay refrigerated and never freeze and that the correct range should have been from 2 to 8 degrees Celsius. Fox said that McKesson violated the contract and knowingly submitted false claims in an attempt to avoid liability for replacing potentially ruined vaccines. The vaccines shipped by McKesson were intended for children. 

VASCULAR SOLUTIONS SETTLES FALSE CLAIMS ACT CASE

Vascular Solutions (VSI) will pay $520,000 to resolve allegations that it caused false claims to be submitted to federal health programs by marketing a medical device for the ablation (or sealing) of perforator veins without U.S. Food and Drug Administration (FDA) approval and despite the failure of its own clinical trial. VSI, a medical device company based in Minneapolis, Minn., markets and sells medical devices that treat varicose veins by sealing the veins with laser energy – endovenous laser ablation. Their products include consoles, which generate the laser energy, and accessory kits.
In 2010, DeSalle Bui, a former Vascular Solutions salesperson, sued the company. The U.S. Attorney’s Office in Texas subsequently intervened in the case. The lawsuit accused VSI of “off-label promotion” of its Vari-Lase products, saying the company marketed the product for the treatment of perforator veins despite the fact that it wasn’t approved for such uses. The lawsuit alleged that the improper promotion of the product, as well as kickbacks that VSI paid to physicians, caused the government to lose roughly $20 million, as health care providers submitted claims to government programs such as Medicare.


JURY AWARDS $730,000 IN WHISTLEBLOWER LAWSUIT

A jury has returned a $730,000 verdict in favor of a whistleblower who reported on an unethical pain management study on prison inmates by researchers at the University of California, Davis. Janet Keyzer, a former UC Davis administrative nurse, claimed in a lawsuit that her career was ruined when she raised questions about whether the research project on physically and mentally disabled inmates at San Quentin Prison had obtained consent from its subjects. The Superior Court jury’s verdict was in favor of the 59-year-old Keyzer. She had worked for the university’s Center for Healthcare Policy and Research for more than nine years at the time of her termination in 2007.

Whistleblower-Rules To Live By

 

WARNING: If you believe your employer or individuals at your work place are committing federal fraud, DO NOT communicate with us from your company e-mail, computers, fax, phone or any communication device.

If you have information about fraud taking place in your workplace, we can help you resolve the problem without risking your job, your health, or your family. There may also be a substantial cash reward for reporting the fraud, sometimes in the millions of dollars. But we can’t help you if you get fired for calling us or emailing us from your workplace.

Because we cannot guarantee that your employer is not monitoring your communications, we recommend contacting us from your home telephone or computer. We can help you if you are worried about what will happen because you did the right thing and reported potential fraud, but there is no need to take unnecessary risks.

So please, be safe and use your home computer or telephone to talk with us. We’re here to help.

Stephani LeFlore Takes On CVS Pharmacy

CVS Pharmacy's Medicaid Fraud

 

 

CVS pays $17.5 Million to settle Medicaid Fraud
CVS, the giant retail pharmacy chain, has agreed to pay $17.5 Million to settle a whistleblower lawsuit accusing it of Medicaid fraud (“welfare fraud”).

THE FRAUD
According to her False Claims Acts lawsuit, CVS pharmacist Stephani LeFlore of Minnesota brought evidence to the government that CVS used a billing system for years that was designed to overbill Medicaid on prescription charges. Ms. LeFlore is represented by Minnesota attorneys Neil Thompson, Brian Wojtalewicz, Robert Christensen, and James VanderLinden, with local counsel Aaron Halstead of Madison, Wisconsin, where the case was filed in federal court.
It was done in relation to dual-eligible customers – those legitimately on Medicaid who also maintained their private health insurance coverage. The insurance coverages required CVS to charge the insurance company a smaller amount for prescriptions, and limited co-pay from the customer. When a person is allowed Medicaid coverage, the government always obtains an assignment of the person’s rights under their private health insurance coverage. The government essentially takes over the citizen’s rights under the coverage. This includes the common right to pay a smaller co-pay amount on prescriptions.
Ms. LeFlore claimed in her federal and state lawsuits that CVS should only have billed the Medicaid program the same limited co-pay on prescriptions that it would have normally billed the customer under the insurance plan. She alleged that CVS designed a billing software program for its pharmacies that consistently overcharged Medicaid on these co-pays. She claimed that these overcharges occurred on hundreds of thousands of prescription sales for well over five years.
The $17.5 Million settlement covers over-billings by CVS in the states of Minnesota, California, Massachusetts, Michigan, Florida, Indiana, Alabama, Nevada, New Hampshire and Rhode Island.
Ms. LeFlore first complained internally, but she was told by a supervisor that “corporate took care of the billing” and that she need not be concerned. She then retained her attorneys and commenced the False Claims Acts (qui tam) lawsuit in September, 2008. The lawsuit stayed under seal (non-public), according to the False Claims Acts and court orders, until the announcement of this settlement.
Ms. LeFlore and her attorneys will receive $2,595,460.00 as the reward under the federal and state False Claims Acts. They are also entitled to receive attorney fees from CVS.