U.K. Pharmaceutical Company to Pay $15 Million to Settle Medicaid Fraud Charges
Earlier this month, the U.S. Department of Justice (DOJ) announced that Mallinckrodt ARD LLC agreed to settle a lawsuit brought under the False Claims Act. The United Kingdom-based pharmaceutical company agreed to pay the U.S. government $15 million to resolve allegations of Medicaid fraud.
According to the DOJ’s allegations, Mallinckrodt took part in an illegal kickback scheme from 2009-2013 that including the “wining and dining” of physicians to persuade them to write prescriptions for the company’s drug H.P. Acthar Gel.
The DOJ alleged that Mallinckrodt provided the doctors lavish dinners and entertainment, to induce them to prescribe the drug. This behavior is a clear violation of the Anti-Kickback Statute. Pharmaceutical companies may not pay physicians anything of value with intent to coax health care providers into prescribing a specific drug.
Two qui tam whistleblower lawsuits, filed under the False Claims Act, initiated this case. The whistleblower or qui tam provisions of the False Claims Act (FCA) allow persons to sue for fraud on behalf of the United States government and share on any monies recovered. The two qui tam whistleblowers will share a whistleblower award of $2.9 million.