In order to resolve claims that the pharmaceutical corporation minimized hazards associated with several of its products and that its sales staff paid hospitals and physicians bribes for prescribing its medications, Bayer agreed to pay $40 million.
The Department of Justice stated in a news statement on Friday that hospitals and physicians broke 20 state and federal laws by filing fraudulent Medicaid and Medicare claims as a result of Bayer's alleged misbehavior with the medications Trasylol, Avelox, and Baycol.
The claims surfaced after Laurie Simpson, a former marketing staffer, filed a complaint in 2005 in the U.S. District Court for the District of New Jersey, alleging that the sales team had given doctors bribes for prescribing Trasylol and Avelox. According to the settlement, Bayer's sales representatives allegedly gave hospitals and physicians payments in exchange for their prescriptions of medications for off-label purposes that were neither reasonable nor essential.
Simpson claimed in a second complaint, filed in 2006 and later moved to the U.S. District Court for the District of Minnesota, that Bayer was aware of the dangers of Baycol but minimized them. According to the settlement, the business misrepresented Baycol's comparative efficacy to other pharmaceuticals on the market and deceived the Defense Logistics Agency about the medication in order to get contract renewals from the agency.
Eventually, Baycol and Trasylol were taken off the market for security concerns.
When she was still an employee, Simpson said she faced retaliation for voicing concerns that the business was not abiding by its corporate compliance policies.
According to Brian Boynton, chief of the DOJ's Civil Division, "Today's recovery highlights the critical role that whistleblowers play in the effective use of the False Claims Act to combat fraud in federal healthcare programs."
Bayer will pay $38.9 million to the federal government and $1.1 million to the 20 affected states and the District of Columbia as part of the settlement, which it accepted without admitting or disputing any wrongdoing. $21 million of the $40 million total is for reparations.
According to the False Claims Act's qui tam provisions, Simpson will get $6 million from Bayer as compensation for his retaliation claim and an additional $11 million from the federal government once the money is received.
A Bayer spokeswoman stated in a statement that the settlement of these claims "reflects a business decision by the company that resolution was preferable to continuing already protracted litigation under a statute that is inefficient and in need of reform."
By fLEXI tEAM