10 September 2024. The U.S. Attorney’s Office for the Eastern District of Pennsylvania announced a civil settlement with a Mahwah, New Jersey-based pharmaceutical manufacturer. To resolve allegations of violating the Anti-Kickback Statute, Glenmark Pharmaceuticals, Inc. paid a $25 million settlement. This is in addition to a $30 million criminal penalty Glenmark paid last year as part of a deferred prosecution agreement negotiated with the Department of Justice’s Antitrust Division. There was no whistleblower in this pharmaceutical price fixing fraud case, but whistleblowers under the False Claims Act are typically entitled to 15-25% of the government’s recovery.
Case Overview
Glenmark Pharmaceuticals was accused of conspiring to fix the price of pravastatin, a generic drug that medical providers prescribe to treat high cholesterol. According to the allegations, Glenmark colluded with other pharmaceutical manufacturers regarding “price, supply, and allocation of customers.”
Anti-Kickback Statute Violations
The allegations center around violations of the Anti-Kickback Statute, which holds that healthcare providers cannot pay or be paid for referrals of services or goods covered by a government-funded healthcare program. Violations of the Anti-Kickback Statute harm healthcare providers, patients, government-funded healthcare programs, and taxpayers by undermining the integrity of the healthcare system. When kickbacks are involved, healthcare providers may make decisions based on financial incentives rather than patient care, leading to unnecessary or substandard treatments that can harm patients. These illegal practices also inflate costs for government-funded healthcare programs like Medicare and Medicaid, draining resources and leading to higher healthcare costs overall. Ultimately, taxpayers bear the financial burden, as they fund these programs, and the quality of care suffers due to compromised medical decision-making.
Ensuring Compliance
This settlement underscores the critical role of the False Claims Act in ensuring that the United States is compensated when it falls victim to kickbacks intended to promote anti-competitive behavior. For those in the pharmaceutical industry, this case serves as reminder that private citizens can speak up and share their original knowledge of fraud schemes and be rewarded under the qui tam provisions of the False Claims Act.
If you would like to report violations of the Anti-Kickback Statute or pharmaceutical fraud, you can contact attorneys at Tycko & Zavareei LLP. Eva Gunasekera and Renée Brooker are former officials of the United States Department of Justice and prosecuted whistleblower cases under the False Claims Act. Eva was the Senior Counsel for Health Care Fraud. Renée served as Assistant Director at the United States Department of Justice, the office that supervises False Claims Act cases in all 94 United States District Courts. Eva and Renée now represent whistleblowers. For a free consultation, you can contact Eva Gunasekera at [email protected] or contact Renée at [email protected] (tel.: 202-417-3664). Visit Tycko & Zavareei LLP’s website for whistleblowers to learn more at www.fraudfighters.net.