Archive for November, 2013

J & J Settlement Pays Off For Nation’s Capital

Monday, November 18th, 2013

The government’s recent massive settlement with Johnson & Johnson is paying dividends for the residents of Washington, D.C.

The District of Columbia’s Medicaid program will receive more than $3 million out of the $1.2 billion settlement, which resolved four qui tam cases filed in federal court in the Eastern District of Pennsylvania. 

The suits contended that Johnson & Johnson and subsidiary Janssen Pharmaceuticals, Inc., engaged in off-label promotion of antipsychotic drugs Risperdal and Invega.

PA Lawmakers Say Massive J&J Risperdal Settlement Proves Need For State False Claims Law

Friday, November 8th, 2013

In early June, two Pennsylvania State legislators introduced House Bill 1493, a state version of the federal False Claims Act. The bill would reportedly provide the state with a crucial tool in fighting healthcare waste, fraud, and abuse.

“Pennsylvanians lose as much as $200 million a year through Medicare and Medicaid fraud and abuse,” said Democratic State Rep. Brandon Neuman in a press release introducing the bill. “Our Pennsylvania False Claims Act legislation… would go a long way toward deterring this dishonesty.” The proposed bill would allow the Pennsylvania attorney general or a whistleblower to file a civil suit against those committing fraud against the Commonwealth while holding violators liable for triple the damages sustained by the state. It would also aim to protect whistleblowers who suffered harassment, career consequences, or discrimination for lawfully pursuing a false claims case.

According to Neuman, this bill would provide the essential tools for the commonwealth to recover the “maximum amount possible from those who cheat or attempt to cheat the government.” He claims that this bill would serve the dual purpose of providing a new source of revenue while punishing and preventing those who attempt to steal taxpayer dollars.

Neuman, along with fellow Democratic legislator Tony DeLuca, of Allegheny County, introduced the bill in the wake of Johnson & Johnson’s multibillion dollar settlement for the off-label marketing of its drug antipsychotic drug, Risperdal.

More than half of the states in the U.S. and the District of Columbia have already implemented false claims acts. Kathleen Kane, Pennsylvania Attorney General, is said to be in support of the proposal.

Second Circuit Affirms Dismissal Of Qui Tam Case Based On Attorney’s Use Of Confidential Information

Friday, November 8th, 2013

The decision by the District Court for the Southern District of New York to disqualify Fair Laboratory Practices Associates (FLPA) from its qui tam suit against Quest Diagnostics (Quest) and Unilab Corporation (Unilab) was recently affirmed by the US Court of Appeals for the Second Circuit.  Unilab’s former general counsel, Mark Bibi, planned to use confidential information in disclosures against Quest and Unilab.

While Bibi was aware that he was intending to use confidential information, he believed that False Claims Act’s (“FCA)” provided an exception to the applicable ethical rules.

The FPLA Suit alleged that Unilab illegally priced its medical testing services by providing significant discounts to medical care providers to induce them to refer Medicare and Medicaid business. Unilab then proceeded to charge significantly higher rates for incoming federal business. This “pull-through” scheme is expressly prohibited by the US Department of Health and Human Services.

The District Court held that the FCA does not preempt state ethical rules, including attorney-client confidentiality.  The Second Circuit affirmed, noting that Bibi’s disclosures exceeded what was reasonably necessary to prevent a crime.

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