Kickbacks Allegedly Were Disguised as “Consulting Agreement” Compensation
Teva Pharmaceuticals will pay $27.6 million to settle claims that it violated the False Claims Act by paying kickbacks to induce a physician to write more prescriptions for an anti-psychotic drug.
The settlement resolves claims that the pharmaceutical company paid a physician to induce him to write prescriptions for generic clozapine, an anti-psychotic medication. Clozapine is usually considered a drug of last resort because it has serious potential side effects, especially for elderly patients. The side effects include a potentially deadly decrease in white blood cells, seizures, inflammation of the heart muscle, and increased mortality in elderly patients.
The complaint alleged that the kickbacks were disguised as compensation under a “consulting agreement.” Under that agreement, the pharmaceutical company allegedly paid the doctor $50,000 per year and other benefits to induce him to switch his patients to generic clozapine. The other benefits included all-expenses paid trips to Miami for the doctor, his wife, and several of his employees.
After entering into the “consulting agreement,” the doctor quickly became the largest prescriber of generic clozapine in the United States.
The government claims that the payments and other benefits continued for many years, resulting in Medicare and Medicaid paying for thousands of generic clozapine prescriptions.
The Anti-Kickback Statute prohibits pharmaceutical companies from offering or paying anything of value to induce prescriptions covered by Medicare or Medicaid. This kickback prohibition is designed to ensure that a physician’s medical judgment is based solely on the best interests of the patient and not compromised by improper financial incentives.
Individuals who help the government uncover these types of healthcare frauds are entitled to significant rewards – up to 30% of the amount the government recovers. But you must follow a specific, confidential process to qualify. If you go to the government on your own or give your evidence to the media, you may lose your right to a reward.
If you have evidence that a pharmaceutical company, hospital, or other healthcare provider is paying kickbacks in return for prescriptions or patient referrals, then you should consult with an experienced whistleblower attorney immediately to protect your rights.
To arrange a free and confidential consultation with an experienced whistleblower lawyer, call John Howley, Esq. at (212) 601-2728 or click here to reach our offices via email.
John Howley, Esq.
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