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As False Claims Act attorneys, and especially attorneys who represent clients that have the courage to blow the whistle on fraud against the federal government, we are pleased to see that a Sanofi has agreed to pay more than $100 million dollars to settle claims that it violated the False Claims Act by giving physicians free units of Hylagan, a knee injection, in violation of the Anti-Kickback Act.

Sanofi-Aventis U.S. Inc. and Sanofi-Aventis U.S. LLC, subsidiaries of international drug manufacturer Sanofi (collectively, Sanofi US), have agreed to pay $109 million to resolve allegations that Sanofi US violated the False Claims Act by giving physicians free units of Hyalgan, a knee injection, in violation of the Anti-Kickback Statute, to induce them to purchase and prescribe the product. The settlement also resolves allegations that Sanofi US submitted false average sales price (ASP) reports for Hyalgan that failed to account for free units distributed contingent on Hyalgan purchases. The government alleges that the false ASP reports, which were used to set reimbursement rates, caused government programs to pay inflated amounts for Hyalgan and a competing product.

The United States contends that, facing pressure from a lower-priced competitor, Sanofi US provided its sales representatives with thousands of free “sample” Hyalgan units and trained its sales representatives to market the “value add” of these units to physicians. In practice, the United States alleges, Sanofi US sales representatives often entered into illegal sampling arrangements with physicians, using the free units as kickbacks and promising to provide negotiated numbers of them in order to lower Hyalgan’s effective price. The government contends that there were numerous such arrangements, including:

• A Southern California-based Sanofi US sales representative who allegedly provided 25 Hyalgan samples to a physician practice for every 100 Hyalgan units purchased, and who supplemented these kickbacks by regularly treating the entire practice to lavish dinners at Sanofi US’s expense and with Sanofi US’s approval.
• A New York-based Sanofi US sales representative who allegedly provided 12 Hyalgan samples to a physician practice for every 50 Hyalgan units purchased, and whose manager supplemented these kickbacks by treating the practice, along with friends and family members, to a lavish dinner in Manhattan at Sanofi US’s expense and with Sanofi US’s approval.

·         A Central Texas-based Sanofi US sales representative who allegedly promised a physician practice 125 free Hyalgan syringes in exchange for a purchase of 500 Hyalgan units and was lauded by Sanofi US’s Texas sales team for “[u]tiliz[ing] samples to provide value for the office.”

The United States contends that price was important to physicians because Hyalgan and its direct competitor were reimbursed at the same, fixed rate by Medicare and other insurers. Thus, the less expensive option afforded a greater reimbursement “spread,” or profit, to physicians’ practices. According to the government’s allegations, Sanofi US chose not to compete by lowering the actual invoiced price of Hyalgan, for fear of setting off a price war with its competitor that would lead to a “downward spiral” in prices and reimbursements. Instead, the government alleges, Sanofi US surreptitiously lowered the effective price of Hyalgan by promising the free units to doctors who agreed to purchase the product. The government alleges that Medicare and other federal health care programs paid millions of dollars in kickback-tainted claims for Hyalgan.

“Kickback schemes subvert the health care marketplace and undermine the integrity of public health care programs,” said Principal Deputy Assistant Attorney General for the Civil Division Stuart Delery. “We will continue to hold accountable those who we allege are providing illegal incentives to influence the decision making of health care providers in federal health care programs.”

“The government’s allegations describe a situation where a drug manufacturer used valuable free units of a drug to subvert Medicare’s drug reimbursement system for physicians,” said Carmen M. Ortiz, United States Attorney for the District of Massachusetts. “This is not the first time that this Office has brought action against a manufacturer who engaged in such an illegal scheme, and the government will remain vigilant in policing such conduct.”

“Patients expect their health providers to be concerned solely with their best medical interests” said Daniel R. Levinson, Inspector General for the U.S. Department of Health. “Kickbacks undermine that all-important patient trust, and taxpayers’ expectation that government health dollars be put only to the wisest of uses.”

Today’s settlement with the France-based pharmaceutical manufacturer resolves a lawsuit filed by former sales representative Mark Giddarie under the qui tam, or whistleblower provisions, of the False Claims Act. Under the False Claims Act, private citizens can bring suit on behalf of the United States and share in any recovery. Giddarie will receive $18.5 million as his share of the government’s recovery.

This settlement was the result of a coordinated effort by the Department of Justice, Civil Division, Commercial Litigation Branch; the U.S. Attorney’s Office for the District of Massachusetts; the FBI; and the Offices of the Inspectors General of the U.S. Department of Health and Human Services, the U.S. Postal Service, and the Office of Personnel Management.

This resolution is part of the government’s emphasis on combating health care fraud and another step for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced by Attorney General Eric Holder and Kathleen Sebelius, Secretary of the Department of Health and Human Services in May 2009. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in that effort is the False Claims Act, which the Justice Department has used to recover $10.1 billion since January 2009 in cases involving fraud against federal health care programs. The Justice Department’s total recoveries in False Claims Act cases since January 2009 are over $13.9 billion.

This case is docketed as United States ex rel. Giddarie v. sanofi-aventis U.S., Inc., No. 10-CV-10070 (D. Mass.). Sanofi-Aventis U.S. Inc. and Sanofi-Aventis U.S. LLC, subsidiaries of international drug manufacturer Sanofi (collectively, Sanofi US), have agreed to pay $109 million to resolve allegations that Sanofi US violated the False Claims Act by giving physicians free units of Hyalgan, a knee injection, in violation of the Anti-Kickback Statute, to induce them to purchase and prescribe the product. The settlement also resolves allegations that Sanofi US submitted false average sales price (ASP) reports for Hyalgan that failed to account for free units distributed contingent on Hyalgan purchases. The government alleges that the false ASP reports, which were used to set reimbursement rates, caused government programs to pay inflated amounts for Hyalgan and a competing product.

The United States contends that, facing pressure from a lower-priced competitor, Sanofi US provided its sales representatives with thousands of free “sample” Hyalgan units and trained its sales representatives to market the “value add” of these units to physicians. In practice, the United States alleges, Sanofi US sales representatives often entered into illegal sampling arrangements with physicians, using the free units as kickbacks and promising to provide negotiated numbers of them in order to lower Hyalgan’s effective price. The government contends that there were numerous such arrangements, including:

• A Southern California-based Sanofi US sales representative who allegedly provided 25 Hyalgan samples to a physician practice for every 100 Hyalgan units purchased, and who supplemented these kickbacks by regularly treating the entire practice to lavish dinners at Sanofi US’s expense and with Sanofi US’s approval.
• A New York-based Sanofi US sales representative who allegedly provided 12 Hyalgan samples to a physician practice for every 50 Hyalgan units purchased, and whose manager supplemented these kickbacks by treating the practice, along with friends and family members, to a lavish dinner in Manhattan at Sanofi US’s expense and with Sanofi US’s approval.
• A Central Texas-based Sanofi US sales representative who allegedly promised a physician practice 125 free Hyalgan syringes in exchange for a purchase of 500 Hyalgan units and was lauded by Sanofi US’s Texas sales team for “[u]tiliz[ing] samples to provide value for the office.”

The United States contends that price was important to physicians because Hyalgan and its direct competitor were reimbursed at the same, fixed rate by Medicare and other insurers. Thus, the less expensive option afforded a greater reimbursement “spread,” or profit, to physicians’ practices. According to the government’s allegations, Sanofi US chose not to compete by lowering the actual invoiced price of Hyalgan, for fear of setting off a price war with its competitor that would lead to a “downward spiral” in prices and reimbursements. Instead, the government alleges, Sanofi US surreptitiously lowered the effective price of Hyalgan by promising the free units to doctors who agreed to purchase the product. The government alleges that Medicare and other federal health care programs paid millions of dollars in kickback-tainted claims for Hyalgan. 


“Kickback schemes subvert the health care marketplace and undermine the integrity of public health care programs,” said Principal Deputy Assistant Attorney General for the Civil Division Stuart Delery. “We will continue to hold accountable those who we allege are providing illegal incentives to influence the decision making of health care providers in federal health care programs.”

“The government’s allegations describe a situation where a drug manufacturer used valuable free units of a drug to subvert Medicare’s drug reimbursement system for physicians,” said Carmen M. Ortiz, United States Attorney for the District of Massachusetts. “This is not the first time that this Office has brought action against a manufacturer who engaged in such an illegal scheme, and the government will remain vigilant in policing such conduct.”

“Patients expect their health providers to be concerned solely with their best medical interests” said Daniel R. Levinson, Inspector General for the U.S. Department of Health. “Kickbacks undermine that all-important patient trust, and taxpayers’ expectation that government health dollars be put only to the wisest of uses.”

Today’s settlement with the France-based pharmaceutical manufacturer resolves a lawsuit filed by former sales representative Mark Giddarie under the qui tam, or whistleblower provisions, of the False Claims Act. Under the False Claims Act, private citizens can bring suit on behalf of the United States and share in any recovery. Giddarie will receive $18.5 million as his share of the government’s recovery.

This settlement was the result of a coordinated effort by the Department of Justice, Civil Division, Commercial Litigation Branch; the U.S. Attorney’s Office for the District of Massachusetts; the FBI; and the Offices of the Inspectors General of the U.S. Department of Health and Human Services, the U.S. Postal Service, and the Office of Personnel Management.

This resolution is part of the government’s emphasis on combating health care fraud and another step for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced by Attorney General Eric Holder and Kathleen Sebelius, Secretary of the Department of Health and Human Services in May 2009. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in that effort is the False Claims Act, which the Justice Department has used to recover $10.1 billion since January 2009 in cases involving fraud against federal health care programs. The Justice Department’s total recoveries in False Claims Act cases since January 2009 are over $13.9 billion.

This case is docketed as United States ex rel. Giddarie v. sanofi-aventis U.S., Inc., No. 10-CV-10070 (D. Mass.).

If you have information about any alleged fraud against the government, please contact us immediately.

THE SCOPE OF FRAUD

Amazingly, some estimates have suggested that approximately 10% of the entire annual United States budget is lost to companies or individuals who are defrauding the government. The United States Federal budget for 2010 was $3.456 billion, meaning around $345.6 million was wrongfully wasted on fraud.

The entities defrauding the government do so in a variety of ways: Medicare or Medicaid fraud whereby they bill the government for services which they never provided or overbill for services that were provided; SEC Trading; Tax Fraud; TARP Fraud; Military/Defense contract fraud; Pharmaceutical Manufacturing;contract fraud involving any number of large government spending programs; or other types public benefit fraud.

HELPING THE PUBLIC.

As a whistleblower attorney, we are interested in speaking with persons willing to make known the truth about company practices and are willing to file a qui tam or whistleblower action. One area in particular we are interested in discussing are lawsuits involving medical device companies where the company is alleged to have overcharged, engaged in kickback programs, and the like. We will nevertheless investigate claims in a variety of areas.

Workers and persons all across the country witness actions at their work that may be unlawful or even corrupt. Unfortunately, some employees and workers feel that they will be fired, terminated, harrassed or punished if they report an unlawful or corrupt action. These reporters, however, are protected by the law as a Whistleblower and can receive compensation because of the False Claims Act or the Medicaid False Claims Act. If you have reported actions that may be fraudulent, then you should talk to a Whistleblower or qui tam lawyer about your facts.

Whistleblowers help the government to get back billions of dollars each year with the help of the False Claims Act. In fact, fraudulent Medicaid claims are also caught by whistleblowers having the Medicaid False Claims Act on their side. If you report a false claim or fraudulent action to the government, then the government will give you, the whistleblower, a part of the money that gets recovered. This is because of qui tam requirements. Qui Tam means that a person files a lawsuit for the king and also for him or herself. The phrase is qui tam pro domino rege quam pro se ipso in hac parte sequitur, or, “he who sues for the king as well for himself.”

These requirements and lawsuits were made popular during the Civil War when many people were getting away with fraudulent actions against the government. In 1986, the False Claims Act was amended to raise the total compensation given to people who reported fraudulent actions, or whistleblowers. If a whistleblower works with a lawyer then it may be possible for them to get three times the amount the government would get in damages and also get additional compensation for general fines.

TYPES OF CASES

The most common situations that could form the basis of a Qui Tam action include:

• Submitting a false or fraudulent record, bill or statement to the government in order to fraudulently obtain money such as reporting a medical service that was never performed for Medicare or Medicad;
• Conspiring with a third party to submit or present have a false or fraudulent claim to the government;
• Withholding property of the government with the intent to defraud or conceal the property from the government;
• Fraudulently buying property of the government from someone not authorized to sell that property; and
• Making a false statement to fraudulently avoid paying money to the government or to avoid delivering property to the government.

FOR HELP, PLEASE CONTACT US.

We help whistleblowers on a contingency basis, meaning there is no fee charged for our work unless there is a recovery. We also front any and all expenses. No matter where you are located — we will represent you. We will come to you, you will not have to come to us.

Attorneys in our firm and attorneys that we work with on Whistleblower, Qui Tam, False Claims Act cases have represented a host of persons making claims, for violations of federal tax law, Medicare law and more.

For more information, please contact our team of whitsleblower and qui tam attorneys today.

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