We previously reported about Biogen’s $900 million settlement to resolve claims brought by a former employee that Biogen illegally paid kickbacks to health care professionals in violation of the False Claims Act. At the time of our prior article, the settlement was just announced and disclosed in an SEC filing, still pending the negotiation of final settlement agreements and documents. Now, however, the final settlement agreement has been reached.
According to the relator’s complaint, from January 1, 2009, through March 18, 2014, Biogen paid kickbacks to physicians to induce them to prescribe the company’s multiple sclerosis drugs. During the time period, the relator alleged that Biogen offered and paid remuneration – including speaker honoraria, speaker training fees, consulting fees and meals – to health care professionals who spoke at (or even just attended) Biogen’s speaker programs, speaker training meetings, or consultant programs. Biogen allegedly paid the remuneration to induce prescribers to prescribe Avonex, Tysabri, and Tecfidera, in violation of the Anti-Kickback Statute.
Biogen will pay $843,805,187 to the United States and $56,194,813 to fifteen states. Of the total $900 million settlement, $600,000,000 is considered restitution for alleged damage or harm caused by the alleged violations of law.
The Relator will receive $250 million of the federal portion (roughly 29.6% of the federal portion). The United States and the Relator entered into a secondary agreement about the Relator’s award, noting that the United States would pay it directly to the Relator “within a reasonable time after the United States’ receipt of the settlement payment made by Biogen.”
Biogen also agreed to not seek payment “of any of the health care billings covered by this Stipulation and Order of Settlement from any health care beneficiaries or their parents, sponsors, legally responsible individuals, or third-party payors.”
While the settlement notes that each of the parties is responsible for its own legal/other costs incurred in connection with the matter, it also states that “nothing in this Stipulation and Order of Settlement shall preclude Relator from seeking to recover his reasonable expenses which the Court finds to have been necessarily incurred or reasonable attorneys’ fees and costs.”
“The relator diligently pursued this matter on behalf of the United States for over seven years,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “The settlement announced today underscores the critical role that whistleblowers play in complementing the United States’ use of the False Claims Act to combat fraud affecting federal health care programs.”
As was the case previously, the claims resolved by the settlement are only allegations and there has been no determination of any liability.