Pharmaceutical Manufacturer Celgene to Pay $280 Million for Fraud Allegations

andres-de-armas-103880-copy-300x200On July 24, the U.S. Attorney’s Office for the Central District of California announced that Celgene Corp., a pharmaceutical manufacturer headquartered in New Jersey, will pay $280 million to numerous states and the federal government to settle claims that it submitted false claims to the federal government and state health programs. From the settlement, $259.3 million will go to the federal government, $20.7 million will be divided among 28 states and the District of Columbia. California is set to receive more than any other state at $4.7 million.

U.S. ex rel. Brown v. Celgene Corp.

The settlement is the result of a whistleblower lawsuit filed by Beverly Brown under the qui tam provision of the False Claims Act. Brown, who was a sales manager at Celgene, brought a lawsuit on behalf of the federal and state governments. She provided evidence that Celgene promoted two cancer drugs, Thalomid and Revlimid, for uses that were not approved by the U.S. Food and Drug Administration and therefore not covered by federal healthcare programs.

Allegedly, Celgene would publish false and misleading statements about the drugs. The manufacturer apparently hid or softened the adverse medical events associated with the drugs and would also improperly influence information published by drug companies, medical literature, and clinical studies or guides on the two drugs. One of the ways they did this was by making payments to doctors who could influence the content published by drug compendia entries.  

Additionally, Brown alleged Celgene would pay kickbacks to physicians who prescribed Thalomid and Revlimid in order to increase the demand for these products. The alleged result is that physicians prescribed these aggressively marketed cancer drugs instead of prescribing the most safe and effective treatment for their patients.

Federal Government Remains Focused on Healthcare Fraud

One thing has not changed under the Trump administration, the DOJ is still very much focused on uncovering healthcare fraud. False claims to Medicare and Medicaid cost the federal government millions of dollars each year. Every time a private citizen like Brown comes forward about fraud against federal health programs, the federal government is able to investigate and reach settlement agreements to regain money companies unlawfully retained or were reimbursed.

In 2016, the DOJ’s largest recovery for qui tam suits came from the drug and medical device industry. The department recovered $1.2 billion in dollars. Between 2009 and 2016, it has recovered $19.3 billion in health care fraud claims.

Do You Have Information About Healthcare Fraud?

If you work for a hospital, doctor’s office, pharmaceutical manufacturer, medical device company, or any other business within the healthcare industry and you believe you have evidence of it filing false claims to the government, contact our California qui tam attorneys of Brod Law Firm at (800) 427-7020.

Qui tam cases are not simple, and they can take a great deal of time. If you have evidence of fraud and are willing to come forward, you need a knowledgeable and experienced attorney by your side. Contact us today to schedule a free consultation and learn more about your rights and options.

(image courtesy of Andres de Armas)