Biogen was alleged of paying kickbacks to health care professionals to discourage them from prescribing products of its rival companies and paid its prescribers for services it never intended to use
The Biogen headquarters. (Credit: Astrophobe/Wikipedia)
US-based biotechnology company Biogen has agreed to pay $900m to resolve a lawsuit claiming it has unlawfully paid kickbacks to physicians and other professionals.
The lawsuit was filed in 2012, by the company’s former employee Michael Bawduniak in the Massachusetts District Court, under the False Claims Act.
Mr Bawduniak alleged that Biogen had paid kickbacks to health care professionals to discourage them from prescribing products of its rival companies.
In April 2012, Mr Bawduniak, represented by Greene, has filed a lawsuit in the Massachusetts District Court, under the federal False Claims Act.
According to the lawsuit, Biogen legitimately paid its prescribers for services it never intended to use, to prevent its multiple sclerosis drugs from losing market share.
Greene said: “The excessive consultant meetings always stood out to us as evidence of an improper purpose for these payments to physicians.
“Over the years, as we learned more and more and gained feedback from nationally renowned experts, we were confident that a jury would agree: the only reasonable explanation for this kind of activity by Biogen was its belief that the prescribers it paid would be more likely to prescribe their drugs.”
Represented by Evan Chesler of Cravath, Swaine & Moore, the company has reached the settlement days before the federal court in Boston court would commence the trial.
Biogen told Reuters: “We are resolving this matter to avoid the distraction of litigation and to allow the company to focus on our strategic priorities and the patients we serve.”
The settlement under the False Claims Act action will be paid to the US government and the Medicaid programs of different states.
Mr Bawduniak is expected to receive between 25% and 30% of the recovery amount, along with awards from the states who will share the settlement.
Greene added: “Since July 2015, when the United States informed the District Court that it would not intervene in this action, our firm has litigated the case alone, reviewing millions of documents, conducting dozens of depositions, and preparing the case for trial.
“The settlement with Biogen is a great example of what the False Claims Act is designed to encourage – and taxpayers clearly benefit.”