The Swiss-based pharmaceutical giant Novartis will pay Texas $19.9 million to settle allegations that it violated the False Claims Act. The lawsuit was originally filed by a whistleblower, Donald Galmines, in federal court in Pennsylvania. Galmines is a former Novartis marketing representative.
Galmines’ responsibilities included the marketing of the topical cream Elidel, which had been approved by the Food and Drug Administration for use on patients more than two years old who suffer from eczema and whose condition was not well-controlled by preferred, “first-line” treatments. It was alleged in the lawsuit that Novartis engaged in the practice known as “off-label marketing” by requiring its sales representatives to induce doctors to prescribe Elidel for uses not approved – and specifically rejected – by the FDA.
The primary off-label use at issue was for treatment of eczema in children younger than two years of age. Elidel was not shown by Novartis to be safe and effective for such uses. In 2005, the FDA required Novartis to put a “Black Box Warning” on Elidel packaging, warning physicians and consumers that certain cancers in infants were associated with the use of Elidel. In the lawsuit Galmines alleged that Novartis required its sales force to market Elidel for numerous conditions other than eczema, and that it paid physicians kickbacks to encourage them to do so.
The U.S. Department of Justice elected not to intervene in the Pennsylvania complaint filed by Galmines. But Galmines decided to proceed with that case on behalf of the United States and several states, including California, Massachusetts, Virginia, Illinois, and Michigan. His complaint initially included claims on behalf of the State of Texas, but those claims were voluntarily dismissed. Subsequent events led to the Texas settlement. That settlement provides for payment of attorney fees to the State of Texas and legal counsel for Galmines, as well as for a recovery of a share of the settlement to Galmines pursuant to the Texas Medicaid Fraud Prevention Act, which provides that a whistleblower such as Galmines is paid between 15 percent and 25 percent of such a settlement. Galmines is represented by Jennifer Verkamp and Rick Morgan, lawyers with the firm of Morgan Verkamp, located in Cincinnati, Ohio. They did a very good job in this case.
Source: Corporate Crime Reporter
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