Astellas Pharma Pays $7.3 million to Settle Qui Tam Lawsuit Alleging Off-Label Promotion of Mycamine for Pediatric Use
A former sales representative for Astellas Pharma US will receive a $700,000 whistleblower reward as part of a settlement of a qui tam or whistleblower lawsuit he brought under the federal False Claims Act.
Frank Smith, the former pharmaceutical sales representative, started a qui tam lawsuit under the federal False Claims Act alleging that his employer illegally marketed and promoted the drug Mycamine for a use that was not approved by the federal Food & Drug Administration (FDA). Specifically, the lawsuit alleged that Mycamine was marketed and promoted for pediatric use when the FDA had only approved the drug for use in adults.
When a drug is marketed for an off-label use, it results in false claims for reimbursement to Medicare and Medicaid. The drug company that engaged in off-label marketing is liable for those false claims and may be required to pay back three times the amount Medicare and Medicaid paid for the drug, plus a penalty of up to $11,000 per false claim.
The pharmaceutical company in this case agreed to settle the whistleblower lawsuit for $7.3 million. The federal government will receive $4.2 million of that amount and state governments will share $3.1 million.
Under the federal False Claims Act, an individual who has evidence of false claims may start a lawsuit “under seal” (in secret) on behalf of the United States government to recover the money that was paid for the false claims. This is known as a qui tam lawsuit. The government then must investigate the allegations and decide whether to join in the lawsuit or allow the whistleblower to prosecute the lawsuit with his own lawyer.
When the government recovers money as a result of the qui tam lawsuit, the whistleblower is entitled to a reward of between 15% and 30% of the total amount recovered. In this case, the whistleblower will receive more than $700,000 from the federal portion of the recovery, or approximately 17% of the federal government’s share of the settlement. The whistleblower may also be entitled to rewards from the state governments’ share of the settlement under state false claims acts.
If you have evidence that false claims are being submitted to Medicare or Medicaid, then you should consult with an experienced whistleblower lawyer immediately to protect your rights. You may be entitled to a significant reward and legal protections.
Do not delay. Only the first whistleblower who comes forward with evidence is entitled to the reward.
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 law offices via email.
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