In the past week, the US Dept. of Justice filed two separate lawsuits twice against Novartis, the popular pharmaceutical company. The complaints allege that the drug maker offered multi-million dollar kickbacks to doctors and pharmacists as a way to boost prescriptions for their medications. These prescriptions may have caused federal health care programs such as Medicare and Medicaid to pay for unnecessary prescriptions. One complaint seeks damages for corrupting the prescription dispensing process by providing incentive programs to doctors that prescribe their medications.
An additional complaint alleges that the drug maker offered kickbacks and rebates to pharmacies that were willing to switch the medication that transplant patients received, from competing brands to the Novartis brand’s Myfortic immunosuppressant treatment.
Lawmakers have cracked down on this sort of thing in the past decade, and many similar allegations have been made against other pharmaceutical companies. In the case of these most recent lawsuits, doctors were offered gifts and extravagant dinners and trips. Others received incentives to speak or attend presentations that never took place.
This is not the first time that Novartis has found themselves in legal hot water. Three years ago Novartis, as Preet Bahara, pled guilty to misdemeanor criminal allegations that the company promoted Trileptal, an epilepsy medication, improperly. At that time, Novartis paid out $422.5 million in fines.
As part of that settlement, the company had to sign a five year Corporate Integrity Agreement. In the past weeks’ lawsuits, the US Department of Justice alleges that Novartis has not upheld the terms of the agreement.
The lawsuits of the past two weeks clearly state that the kickbacks that doctors and pharmacists received occurred both before and after the agreement was signed. The lawsuits were only filed after the feds very carefully reviewed the CIA, and it is thought that this is part of the reason why criminal charges were not filed together.
For their part, Novartis disputes all the claims brought forth and plans to defend themselves. The company claims that discounts and rebates are a commonly used and accepted practice within the industry. Novartis also contends that speaker programs are not just acceptable, but they are informative tools that doctors can use to ensure that they properly use and dispense Novartis medications. The company said in a statement that they are dedicated to “doing it right.”
If found guilty, this lawsuit has the potential to cause Novartis to be faced with the unprecedented action of exclusion, which would not allow the drug maker to have any contracts with federal health care agencies such as Medicaid and Medicare. Additionally, Novartis could face massive fines and have to contend with a weaker standing when settlement it comes to settlement talks.
For the moment allegations are just allegations, but with charges like the ones that the Department of Justice has brought, it is becoming more difficult to for the powers-that-be in the pharmaceutical industry to claim that they are changing their ways.