These days, Americans are used to filling prescriptions for pharmaceutical products ordered by healthcare providers. This is especially true for beneficiaries of federal healthcare programs like Medicare and Medicaid. Unfortunately, many of the largest — and most troubling — penalties for fraud against the U.S. government involve claims made by the pharmaceutical companies that make those drugs and biologics.
While a company may make a false claim for payment to the government, misconduct by pharmaceutical companies may also endanger the patients who take their product.
Two settlements involving pharmaceutical companies that stand out involve manufacturing bad drugs outside the country, then selling them domestically — getting reimbursed by federal programs such as Medicare.
- A GlaxoSmithKline subsidiary admitted in 2010 that it sold drugs from a Puerto Rico plant (now closed) that did not meet rigorous quality requirements. Four drugs — a topical anti-infection ointment, an anti-nausea medication, an anti-depressant, and a Type II diabetes drug — either were contaminated or were made with flawed methods that affected their efficacy. Generally, they didn’t comply with good manufacturing practices. Civil and criminal penalties amounted to $750 million.
- In 2013, Ranbaxy — a generic drug maker in India — agreed to pay $500 million to resolve allegations that it had falsified data to get FDA approvals, as well as violated good manufacturing and lab practices, putting substandard drugs on the U.S. market. The fraud applied to more than 20 generic drugs.
In both cases, whistleblowers initiated lawsuits that led to successful enforcement actions (and the whistleblowers received awards of roughly $96 million and $48 million, respectively).
Constant vigilance is necessary in this very lucrative sector, however.
In April, Glenmark Pharmaceuticals recalled dozens of drugs — generics that treat a broad range of common ailments and were made in an Indian factory. The drugs didn’t meet U.S. standards and could harm people, according to a report by ProPublica.
FDA officials inspected the factory about two months after a ProPublica investigation detailing repeated problems with drugs made there, and ProPublica sources criticized the FDA’s oversight of foreign-made generic drugs.
Startlingly, the FDA enforcement action lists 39 Glenmark drugs — including over-the-counter pain medications naproxen sodium (the generic version of Aleve), acetaminophen (the generic version of Tylenol), and ibuprofen (the generic version of Advil).
Amid federal layoffs and related upheaval, whistleblowers are more crucial than ever to helping the federal government — and the states who also pay amounts under the Medicaid program — find other pharmaceutical companies like Glenmark whose quality may endanger anyone who takes their product. The United States has a unique law called the False Claims Act that prohibits the knowing submission of false claims for payment to the government. It applies to situations where pharmaceutical companies know their products do not conform to specifications and nonetheless make claims for payment from federal healthcare programs like Medicare and Medicaid. That law provides both protections and awards for whistleblowers who provide original information to help stop such fraud and the harm it causes.
Keller Grover has a long history of helping whistleblowers expose wrongdoing. Our experienced pharmaceutical whistleblower attorneys can help answer questions, work with whistleblowers to develop prudent next steps, and help to submit stronger claims. Thorough submissions will have a better chance of success in encouraging government officials to investigate fraud and obtaining the largest possible whistleblower reward.
If you would like more information, contact us for a free, confidential consultation with a pharmaceutical whistleblower attorney.