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Oct 6, 2022 by |

San Francisco Whistleblower Attorney: Pharmaceutical Company Agrees To Pay $7.9 Million For Alleged Payments For Invalid Prescription Drugs


Former Employee Blows Whistle On Alleged Mislabeling

Allegations Of Over The Counter Drugs Labelled As Prescription Drugs

Realtor Will Receive $946,000 Reward

Private citizen cases for fraud against the government are brought under the False Claims Act, 31 U.S.C. §§ 3729 et seq. (FCA).  The FCA allows individuals with knowledge of fraud against the federal government to initiate actions on behalf of the government (known as “qui tam” actions) to recover government funds paid out as a result of fraudulent claims.  31 U.S.C. §3730(b).  If the government recovers, these individuals, known as “relators,” are eligible for rewards. 31 U.S.C. § 3730(d).  Relators of fraudulent conduct are often employees of the business engaging in the fraud.  Each year relators in FCA cases recover billions of dollars for the government. Any business billing the government for products or services is subject to government regulation affecting that business and its billing practices for government work, and is also subject to the fines and penalties of the FCA.  Healthcare fraud is the largest type of fraud perpetrated against the government every year for false claims under federal programs like Medicare and Medicaid. If you have credible information of government fraud in San Francisco or elsewhere in California, call us today at (415)441-8669 and we can help. Our toll-free number is 1-888-50EVANS (888-503-8267).

Pharmaceutical Company Settles FCA Allegations For $7.9 Million

In a recent settlement announced by the U.S. Department of Justice,[1] a pharmaceutical company has agreed to pay $7.9 million to resolve allegations that it caused the submission of false claims to Medicare Part D, in violation of the False Claims Act, for three generic drugs that were no longer eligible for Medicare coverage.  FDA-approved “prescription only” (Rx-only) drugs may be dispensed only upon a prescription and are reimbursed by Medicare Part D, whereas “over the counter” (OTC) drugs may be purchased by retail customers without a prescription and are not reimbursed by Medicare Part D. Subject to FDA approval, companies may seek to fully convert a brand-name Rx-only drug to an OTC drug. After FDA’s approval of a drug’s full conversion to OTC status, the drug is no longer considered an Rx-only product and makers of generic equivalents are then required either to seek FDA approval for their own OTC switch or to seek withdrawal of their generic’s Rx-only approval and cease marketing it.  The United States alleged that defendant submitted or caused to be submitted false claims to Medicare Part D, in violation of the False Claims Act, by continuing to sell generic drugs under obsolete Rx-only labeling after the brand-name drugs were converted to OTC products.

Fundamentals Of A Qui Tam Case

The reported case was brought by a former employee who will receive approximately $946,000 from the recovery.  Qui tam cases begin with filing a complaint in the federal district court where the allegedly fraudulent conduct occurred.  31 U.S.C. § 3730(b).  The complaint is filed under seal.  The government has sixty days to review the allegations and decide whether to intervene.  This review period can be extended.  If the government decides to intervene, the government essentially takes over the litigation.  31 U.S.C. § 3730(c).  If the government decides not to intervene, the relator has the right to continue the litigation on his or her own.  If the relator continues the litigation alone, he or she receive a larger percentage of the amount the government eventually recovers.  31 U.S.C. § 3730(d).  The relator may also pursue claims for wrongful retaliation against the defendant if the relator was fired or demoted as a result of blowing the whistle.  31 U.S.C. § 3730(h).

Contact Us

If you have credible information of government fraud call Ingrid M. Evans at (415) 441-8669, or toll-free at 1-888-50EVANS (888-503-8267) or by email at <a href=””></a>.  In addition to FCA and CFCA whistleblower cases, Ingrid and Evans Law Firm, Inc. also handle bank fraud whistleblower cases under FIRREA/FIAFEA, commodity trading and securities fraud under the Commodities Futures Trading Commission Whistleblower Program and the Securities and Exchange Commission Whistleblower Program, and tax fraud under the Internal Revenue Service Whistleblower Program. 

[1] Evans Law Firm, Inc. was not involved in the case in any way. The qui tam case is captioned U.S. ex rel. Albermarle, LLC v. Akorn Operating Company, LLC (D. Mass.)

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