Novartis Pharmaceuticals Corp. was sued by the US government on Tuesday. The lawsuit claims that the pharmaceutical company gave kickbacks to pharmacies who switched patients from competitors’ drugs to its own.
US Attorney Preet Bharara explained that Novartis is a repeat offender who settled fraud charges based on kickbacks less than three years ago. The civil health care fraud lawsuit was filed in US District Court in Manhattan.
The United States is seeking unspecified damages and civil penalties for the scheme, which they say Novartis has carried out since 2005. Bharara added that the company used the “lure of kickbacks disguised as rebates” to turn at least 20 pharmacies into a sales force for the drug Myfortic.
The attorney added that the actions by Novartis forced Americans to pay tens of millions of dollars for kickback-tainted drugs that were dispensed by pharmacists who were friends with the drug company. Novartis released a statement saying that the company denies the allegations. The company added that it will defend itself.
Novartis added that the investigation into the company’s interactions with pharmacies related to Myfortic were previously disclosed. The statement added:
“As a leading healthcare company, Novartis strives to achieve high performance with high integrity. NPC is committed to high standards of ethical business conduct and regulatory compliance in the sale and marketing of our products.”
The lawsuit alleges that Novartis found it highly profitable to pay pharmacies 10 to 20 percent kickbacks if the pharmacy switched transplant patients. The government alleges that the arrangement violated the federal anti-kickback statute that prohibits the offer of rebates and other inducements in exchange for any drug or service that is covered by Medicare, Medicaid, or any other healthcare program.
The government added that Novartis gave one pharmacist in Los Angeles a “rebate” worth several hundred thousand dollars. In response, the pharmacist switched 700 to 1,000 transplant patients to Myfortic.
The US government also filed another lawsuit against Novartis on Friday with similar claims linked to the drugs /lotrel, Valturna, and Starlix.