A pharmaceutical company will pay $280 million to settle fraud allegations made in Los Angeles related to the marketing of cancer treatment drugs for uses not approved by the U.S. Food and Drug Administration, the Department of Justice has announced.
The whistleblower lawsuit filed in Los Angeles federal court alleged New Jersey-based Celgene Corp. used false and misleading statements and paid kickbacks to doctors to prescribe the drugs.
Celgene agreed to pay the settlement to resolve claims it had violated the federal False Claims Act by submitting false claims to Medicare. The lawsuit also alleged that Celgene violated the laws of 28 states and the District of Columbia by submitting fraudulent claims to health care programs, including California’s Medi-Cal program.
Celgene didn’t admit liability in the settlement and said it denies wrongdoing. The company said it settled the case to avoid the uncertainty and expense of protracted litigation, according to the federal announcement Tuesday.
Pursuant to the settlement, which was finalized last week, Celgene will pay $259.3 million to the United States and $20.7 million to the 28 states and the District of Columbia. California will receive $4.7 million, more than any other state, according to the DOJ. Celgene is expected to pay the settlement Wednesday.
The complaint was brought in 2010 by Beverly Brown, who worked as a sales manager trained to promote Thalomid and Revlimid drugs for cancer treatments that had not been approved by the FDA.
Thalomid, another name for thalidomide, a drug prescribed for morning sickness in the 1950s and 1960s that caused severe birth defects, was approved in 1998 for treating about a fraction of the few hundred leprosy cases diagnosed in the U.S. each year, according to court filings. Revlimid is derived from thalidomide and was a successor to the earlier drug.
–City News Service