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Novartis Pharmaceuticals Corp. Accused of Paying Kickbacks to Doctors
Novartis Pharmaceuticals Corp., a subsidiary of Novartis AG, headquartered in East Hanover, New Jersey, has been accused of paying kickbacks to doctors in exchange for prescribing its drugs. The company allegedly violated the Anti-Kickback Statute, which prohibits the payment of remuneration to induce referrals of items or services covered by Medicare, Medicaid, and other federally-funded programs.
According to the government’s complaint filed in the Southern District of New York, Novartis systematically violated the Anti-Kickback Statute from January 2001 through at least November 2011. The company allegedly paid doctors to speak about certain drugs, including hypertension drugs Lotrel and Valturna and its diabetes drug Starlix, at events that were often little or nothing more than social occasions for the doctors.
The payments and lavish dinners given to the doctors were, in reality, kickbacks to the speakers and attendees to induce them to write prescriptions for Novartis drugs. In many instances, Novartis made payments to doctors for purported speaker programs that either did not occur at all or that had few or no attendees.
The government’s complaint seeks damages and civil penalties under the False Claims Act and under the common law for paying kickbacks to doctors to induce them to prescribe Novartis pharmaceutical products that were reimbursed by federal health care programs.
“Kickback schemes like those alleged in this case not only call into question the integrity of individual medical decisions, but they also raise the cost of health care for all of us,” said Stuart F. Delery, Acting Assistant Attorney General for the Civil Division. “Patients deserve care based on a doctor’s sound medical judgment, not the doctor’s personal financial interest. The government will continue to pursue companies that use improper incentives, like those alleged here, to promote their products.”
Novartis Pharmaceuticals Corp. is currently listed as a defendant in this case. The exact outcome of the case is still pending. If convicted, the company may face significant fines and penalties.
Key Facts
- State: Federal
- Category: Fraud & Financial Crimes
- Source: DOJ Press Release â†â€â€
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