Whistleblowers Get Record $167.7 Million in Massive J&J Settlement By Tod Aronovitz | 11/14/13 | 0 Comment

Global pharmaceutical company Johnson & Johnson, and its subsidiaries, have been ordered to pay more than $2.2 billion to resolve both state and federal charges in criminal and civil courts surfacing from allegations involving the prescription drugs Risperdal, Invega and Natrecor, the U.S. Department of Justice (DOJ) recently announced.

As one of the largest health care fraud settlements in U.S. history, whistleblowers in the case will receive a record $167.7 million award, divided among an unspecified number of individuals in three states, according to the DOJ.  From the federal government’s share of the civil settlements, whistleblowers in the Eastern District of Pennsylvania will receive $112 million, while the whistleblowers in the District of Massachusetts will get $27.7 million.

According to a November 4 article on CNNMoney.com, there was just one whistleblower in the Northern District of California, identified as Joe Strom. The former employee of Scios, a division of J & J, helped government attorneys build their case and will collect the entire $28 million award, the article revealed.

According to the DOJ announcement, the settlement resolves claims relating to allegations of off-label marketing and physician kickbacks of the following:

  • J & J subsidiary Jansen Pharmaceuticals Inc. for allegedly promoting its schizophrenia drug Risperdal to health care providers as a treatment for psychotic symptoms and associated behavioral disturbances exhibited by elderly, non-schizophrenic dementia patients, in addition to various childhood disorders such as ADHD.  Under the terms of the plea agreement, Janssen will pay $400 million, including a criminal fine of $334 million and forfeiture of $66 million.  Janssen’s guilty plea will not be final until accepted by the U.S. District Court.
  • Janssen for allegedly marketing the newer antipsychotic drug Invega, approved only for the treatment of schizophrenia, for off-label indications and making false and misleading statements about its safety and efficacy. As part of the global resolution, J&J and Janssen have agreed to pay a total of $1.391 billion to resolve the false claims allegedly resulting from their off-label marketing and kickbacks for Risperdal and Invega.  This total includes $1.273 billion to be paid as part of the resolution announced today, as well as $118 million that J&J and Janssen paid to the state of Texas in March 2012 to resolve similar allegations relating to Risperdal.
  • Another J&J subsidiary, Scios Inc., for causing false and fraudulent claims to be submitted to federal health care programs for the heart failure drug Natrecor. The suit alleges that shortly after Natrecor was approved, Scios launched an aggressive campaign to market the drug for scheduled and successive outpatient infusions for patients with less severe heart failure, a use not included in the FDA-approved label nor covered by federal health care programs.  J&J and Scios have agreed to pay $184 million.  In October 2011, Scios also pleaded guilty to a misdemeanor FDCA violation and paid a criminal fine of $85 million for introducing Natrecor into interstate commerce for an off-label use.

The whistleblowers involved in the J & J civil settlements filed their lawsuits under the qui tam, or whistleblower, provision of the False Claims Act.  This act enables private citizens to bring civil actions on behalf of the government and to share in any recovery. Whistleblowers can be awarded between 15% and 30% of the amount recovered in these types of cases.

Medicare Fraud and Whistleblowers

Healthcare professionals who are employed in a facility that is suspected of wasting or abusing federal funds (such as overcharging Medicare, or engaged in some type of Medicare fraud) can work with a whistleblower attorney to bring charges. The person with inside knowledge of inappropriate billings or expenses could be a bookkeeper, a financial executive, a doctor, or a nurse.

Whistleblower cases receive special confidential treatment from the courts during the early investigation period, until allegations can be verified. Charges typically become public only if and when the U.S. government finds sufficient cause and intervenes in the action.

ARONOVITZ LAW: Miami Whistleblower / Qui Tam Law Firm

The Miami Qui Tam law firm of ARONOVITZ LAW routinely works with Miami whistleblowers to document Medicare fraud and other forms of fraud against the government. Contact Miami Whistleblower / Qui Tam lawyer Tod Aronovitz to discuss a case.