9 Qui Tam Lawsuits You Should Know – Part I

Those of us working closely on whistleblower cases are always thrilled to hear statistics revealing the true gravity and importance of qui tam cases. For instance, the Department of Justice reports that in 2012 alone, over $439 million was awarded to qui tam whistleblowers, individuals who brought lawsuits on behalf of U.S. taxpayers against fraudulent companies and individuals. The year 2013 has similarly revealed tens of millions of dollars in fraud, primarily in the healthcare industry, leading to the following high-stakes, high-recovery qui tam lawsuits described below.

U.S. v. Ranbaxy USA, Inc.

As we reported earlier this year, the whistleblower lawsuit settlement with the India-based pharmaceutical company, Ranbaxy, qualifies as the largest penalty imposed under the Food, Drug and Cosmetic Act. In a case involving Medicaid, Medicare and other government-based healthcare programs, Ranbaxy agreed to pay $150 million in fines and penalties as well as the falsification of drug data. The relator in this case, a former executive for the company, received nearly $49 million for his role in preventing fraud and preserving taxpayer confidence.

U.S. v. C.R. Bard, Inc.

In an effort to curtail illegal kickbacks within the healthcare industry, the Department of Justice took aim at New Jersey-based C.R. Bard, Inc. – a company working to produce medical products and treatment for conditions including cancer. The facts of this case revealed a disturbing scheme wherein certain C.R. Bard officials were engaging in fraudulent submissions to government healthcare programs, like Medicaid and Medicare, surrounding the use of radiation treatment therapies for prostate cancer – also known as brachytherapy. The investigation revealed the defendant’s promise of “certain grants, guaranteed minimum rebates, conference fees, marketing assistance and/or free medical equipment” for physicians who opted to work with Bard’s radiation products to treat cancer patients. The ultimate price paid by C.R. Bard for this activity topped almost $50 million.

U.S. v. Par Pharmaceuticals, Inc.

In yet another blow to the healthcare fraud industry, the U.S. Department of Justice reigned victorious over New Jersey-based Par Pharmaceuticals, Inc. after a successful investigation into its marketing strategies linked to its drug Megace ES – a prescription drug used to combat conditions like significant weight loss in  AIDS patients. As with any FDA-approved drug, Megace ES was to be used for the treatment of certain, limited conditions and any attempt by Par to market the drug for uses outside its approval could result in criminal and civil liability – which is exactly the result imposed by the DOJ. Specifically, the DOJ found that Par Pharmaceuticals was routinely and criminally marketing Megace ES to nursing homes for a condition known as “geriatric wasting,” which occurs when elderly patients suddenly begin to experience rapid weight loss. The use of Megace ES for this purpose was never approved by the FDA and Par Pharmaceuticals eventually paid $45 million in criminal and civil charges as a result of a successful whistleblower lawsuit.