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Taxpayers Against Fraud Education Fund is a nonprofit, public interest organization dedicated to combating fraud against the Federal Government through the promotion and use of the Federal False Claims Act and its qui tam provisions.

Common
Types of Fraud:

Fast Facts
about the FCA

The Government Counts on Whistleblowers: More than 80 percent of the False Claims Act cases that are now pursued by the U.S. Department of Justice are initiated by whistleblowers.

Cheaters Pay Whistleblower Awards:
Companies cheating the U.S. Government pay whistleblower rewards – not one dime comes from U.S. taxpayers. The reason for this is that the False Claims Act calls for triple damages so that the Government can be made whole, not only by recouping the cost of whistleblower awards, but also by recovering the cost of investigations, prosecutions, and lost interest.

Big Cases Require Big Investments:
Big fraud cases prosecuted under the False Claims Act often require many years of litigation and investigation. For example, the whistleblower in the first Columbia-HCA fraud case spent 13 years pursuing his False Claims Act lawsuit. The law firm that spearheaded this case invested more than 85,000 hours in the case. In the end, the various frauds perpetrated by Columbia-HCA returned over $1.5 billion to the U.S. Treasury.

Frivolous Lawsuits are Discouraged: Because most False Claims Act lawyers work on a contingency basis, they only get paid if they win. This means that they are unlikely to invest time, money and energy building a case that they themselves do not feel will be productive. In addition, under the False Claims Act, a complainant can be required to pay the defendants attorney’s fees if the court finds that the claim was frivolous or brought primarily for purposes of harassment.

The False Claims Act Provides Some Employment Protections:
If an employee is fired, demoted, harassed, or otherwise discriminated against for filing a False Claims Act suit, the law provides for reinstatement, double back pay, and compensation for special damages, including litigation costs and reasonable attorneys’ fees.

Drug Company Frauds are Pervasive and Large:
Over 180 pharmaceutical fraud cases, covering more than 500 drugs, are now under investigation by the U.S. Department of Justice under the False Claims Act.

Settlement of just 16 drug manufacturing cases (all those resolved to date) has returned over $4 billion to the U.S. Government and the 50 states.

Routine Mistakes and Errors are Not Prosecuted Under the False Claims Act:
The False Claims Act is not used to correct minor billing mistakes or errors, as these frauds are not systematic and rarely amount to truly large sums of money.

Major Cases Under Watch:

Nominal Pricing Fraud:
FCA cases involving violations of the nominal pricing exception have been filed. Possible cases involve statins, proton pump inhibitors, non-steroidal anti-inflammatory drugs, and others.

Iraq War Fraud: Numerous large cases dealing with contractor fraud in Iraq are reported to be under investigation, but remain under seal.

Anti-Psychotic Drugs: Investigations about the off-label marketing of Zyprexa, Risperdal and Seroquel are under way. These three drugs represented combined sales of $12 billion in 2006.

Average Wholesale Price Fraud: The U.S. Government has joined three cases likely to go to trial this summer: Abbott, Dey and Roxane Pharmaceuticals. More than 50 other companies face similar charges in Boston.

University of Phoenix: The Supreme Court has denied cert., and the defendants concede they face a billion dollars in liability.

Outlier Fraud: Several large outlier fraud investigations against hospitals are under investigation.

Newsletters

June 30, 2009
n Major Settlements Ahead
n Major Cases in the Backlog
n Major Cases Settled So Far This Year

June 16, 2009
n Bone Growth Fraud?
n DoJ Files on Mortgage Fraud
n WV Seeks $2 Billion from Lilly
n New Jersey University Pays $2 Million for Double Billing
n Oklahoma Ortho Center to Pay $3.5 Million
n Hawaiian Hospital Settles FCA

June 3, 2009
n Aventis Settles for $95.5 Million
n Pogue Case Against Healthways Settles for $40 Million
n Crooks Worry About Tougher FCA
n Senator Charles Grassley on Bipartisan Support for Amendments to the False Claims Act
n Documents Show AstraZeneca Off-label Marketed Seroquel
n URS Unit Pays $1.7 Million
n Alabama Hits Hard

May 22, 2009
n President Signs False Claims Act Amendments Into Law
n AstraZeneca Faces Heat
n DoJ's Tony West Says FCA Enforcement a High Priority
n Regency Pays $4 Million
n HealthEast to Pay $2.3 Million
n Minnesota Gets a State FCA

May 12, 2009
n President Signs False Claims Act
Amendments Into Law

May 12, 2009
n House Strengthens FCA
n DoJ Joins Lawsuit Against Wyeth over Protonix
n More For Your Money With the FCA
n DoJ Budget Increase
n The High Cost of Low Morals

May 6, 2009
n House Passes Fraud Enforcement and Recovery Act: 367 to 59

May 5, 2009
n WellCare to Pay $80 Million
n Forest Reserves $170 Million
n Maxxam Pays for Forest Fraud
n Shipping Firm to Pay $26 Million
n DoJ Joins HSUS Lawsuit Against Slaughterhouse
n KBR Is Named in Majority of Iraq Frauds Under Investigation
n Fake Merck Peer-reviewed Journal Printed by Elsevier

April 28, 2009
n Senate Says "Yes" to Integrity and "No" to Fraudsters
n House Judiciary Votes Out FCA Corrections Act
n Massive TARP Fraud Ahead?
n Katrina Fraud Settlement
n Alta Colleges to Pay $7 Million

April 21, 2009
n Quest to Pay $302 Million
n Massive Orthotics Fraud
n HUBZone Fraud
n Supreme Court on Eisenstein

April 14, 2009
n Northrop to Pay $325 Million
in Defective Satellite Case
n NetApp to Pay $128 Million
n Custer Battles Must Pay

April 2, 2009
n TAF Testifies in Support
of FCA Amendments
n California Sues Seven Labs
n Par Pharma Subpoenaed
n Radiology Firm to Pay $2 Million
n Houston Hospital to Pay $9.9 Million for Outlier Fraud
n A Three-Legged Watchdog
n Sikorsky to Pay $2.9 Million

March 17, 2009
n Risperdal Marketed Off-label
n Healthways Hopes to Settle
n Odyssey Under Investigation
n Home Healthcare Fraud
n San Mateo County to Pay $6.8 Million for DSH Fraud
n Cornell to Pay $2.6 Million
n WV Hospital to Pay $690,000

March 10, 2009
n US Joins Against NM Hospitals
n Massive Amgen Fraud Case
n DoJ Joins Against Forest
n FDA Says Ranbaxy Faked Data
n NY Medicaid Fraud Recoveries Exceeding Expectation

February 24, 2009
n Pharma Lawyers Now Driving Billion Dollar Settlements
n Shipping Firm to Pay $26 Million
n DoJ Joins FCA Suit Against Scios and Johnson & Johnson
n Liberty Medical ... Again
n Katrina Case Reinstated
n IRS Whistleblower Case Settled for $780 Million
n Pennsylvania Needs an FCA
n AT&T Pays $8.2 Million
n Million Dollar Adult Diaper Fraud

February 10, 2009
n Glaxo's $400 Million Reserve
n Jail Pays Kickbacks to Judges
n A Secret Settlement?
n Heavying Up to Fight Fraud
n Medicare Losing Billions
n SEC Can Learn from the FCA

January 27, 2009
n Pfizer Reserves $2.3 Billion
n Investing in Fraud Busting
n Tony West to Head DoJ Civil
n Top Purdue Pharma Executives Banned for 15 Years

January 22, 2009
n Lilly Pays Record $1.4 Billion for Zyprexa
n FDA Approved Hundreds of Devices Without Review
n AL Hospice to Pay $25 Million
n Rite Aid Pays $5 Million
for Drug Diversion

January 07, 2009
n Ad Agency to Pay $15 Million
n Treatment Center Fraud
n David Ogden, Deputy Attorney General
n A Look Into WellCare’s Fraud
n Another Bulletproof Vest Settlement
n Feds to Bail Out Hedge Funds?
n Teva Pays $7 Million in Mass.

December 30, 2008
n New York Invests to Recover
n Yale to Pay $7.6 Million
n Alabama Sues CMS
n Kickbacks for Iraq Contracts
n Decertifying Fraudsters
n Ohio is Broke and Asleep

December 10, 2008
n Helicopter Maintenance FCA
n Court Asks for DoJ Input
n Final FAR Ruling
n Hearing the Whistleblower
n "Material Effect" Ruling Upheld

December 5, 2008
n MedQuist to Pay $6.6 Million
n $11 Million for Mortgage Fraud
n Condell to Pay $36 Million
n TN Hospitals Pay $5.9 Million
n Jaw Dropping "Error" Rates
n Investigating IT Price-Gouging
n Rumors of UBS Tax Settlement
n The High Cost of Free Samples
n Seeking Doctor Relators

November 25, 2008
n Huge FHA Frauds on Horizon
n Bureaucrats Costing Millions
n Mining a Fraud Seam
n Judge says CMS Can Stop Paying Suspected Fraudsters

November 12, 2008
n Home Health Care Fraud in FL
n $52 Million for Bad Blades
n Pearson Pays $5.6 million
n Medtronic Under Pressure
n WI FCA Qualifies Under DRA

November 12, 2008
n FY 2008 FCA Statistics
n Taxpayers Pay for Both Sides of Wall Street Fiasco
n Vytorin in 35-state Off-Label Investigation

November 5, 2008
n Barack Obama, FCA Attorney
n Schering's Big Loss in MO
n Defective Flares a Threat
n Blowing the Whistle at DoD?
n Adult Day Care Fraud

October 28, 2008
n Lilly Reserves $1.4 Billion for Off- Label Zyprexa Case
n Jury: Unum Defrauded SSDI
n $160 Million in Utilities Case
n U.S. Sues FHA Lender
n Medicare Outlier Case Settled in NJ

October 21, 2008
n NY's Stolen Medicaid Money
n New Orleans Medicaid Recovery
n 5 Pharma Co's Settle With AL
n Fox in Charge of Hen House?
n Medical Device Kickbacks

October 7, 2008
n Lilly Consumer to Settlement a Prelude to FCA?
n WellCare In the Crosshairs
n Armor to Pay $30 Million
n Uncle Sam vs. McKesson Corp.

October 1, 2008
n Cephalon Pays $425 Million
n Unum SSD Fraud Goes to Trial
n EPO Linked to Stroke Deaths
n Walgreens to Pay $9.9 Million
n Ranbaxy PEPFAR Drugs Halted

September 24, 2008
n And the Winners Are
n NJ Hospital to Pay $3.8 Million
n After 14 Years Pogue Goes to Trial n Abbott Settles with Pennsylvania
n Roxanne Settles With Massachusetts
n Connecticut Physical Therapy Network to Pay $1.8 Million

September 17, 2008
n NY Hospital to pay $88 Million
n Abbott Pays $28 Million to TX
n Healthfirst to Pay NY $35 Million
n Maxwell Case Reversed
n IRS Told of Bond Fraud
n US Files Suit Against Boeing
n Counties Can Sue Over Drug Pricing
n Trade Group Burn Notice

August 27, 2008
n Citibank: "Theft Is Our Business Plan"

n Stryker Whines About "Harassment"
n Wellcare Pays $35.2 Million
n Best Case Title of the Week

n CMS Lied About Paring Fraud

August 18, 2008
n Wyeth Subpoenaed for Protonix
n Amerigroup Settlement on GMA
n FASB Wants Companies to
Disclose Legal Liability
n BCBS of TN to Pay $2.1 Million
n To Catch a Thief, Pay for Info
n FBI Raids Three CA Hospitals

August 6, 2008
n More States Qualify Under DRA
n Pratt & Whitney to Pay $52 Million
n Conflict of Interest FCA
n Justice Probes Bile Stent Fraud
n Feds Seize Unapproved Drugs
n CoxHealth To Pay $60 Million
n W.W. Grainger to Pay $6 Million
n Medicare: Wide Open to Fraud

July 28, 2008
n Amerigroup Settles for $225 Million
n A War On Medicare Fraud?
n More Crop Insurance Fraud
n BMS Trial On Deck in Alabama
n Wellcare Says It Owes States Millions of Dollars
n The Parsons Monument to Fraud

June 26, 2008
n House Judiciary Moves on FCA
n No Way to Run a Country
n Foreign Assistance Fraud
n Pharma Cash on the Hill

June 17, 2008
n House Judiciary Moves on FCA
n CBS Features Walgreens Case
n U.S. Bilked Out of $105 Million
n IRS Losing $100 Billion a Year?
n Adulterated Offshore Meds?

June 10, 2008
n Supreme Court Remands Allison Engine Case to 6th Circuit

June 4, 2008
n Walgreens Pays $35 Million
n Pasha Settles for $13 Million
n A Yacht Named "Fringe Benefit"
n Does South Florida Represent
20 Percent of Medicare Fraud?
n DoJ Suits Up Against Kaplan
Massive IRS Whistleblower Case?

May 28, 2008
n Medtronic Settles for $75 Million
n National City Mortgage
to Pay $4.6 Million
n NJ Medicaid Watchdog?
n Schering-Plough "Relationships"

May 20, 2008
n Biovail To Pay $25 Million
n Lockheed Martin Space Systems to Pay $10.5 Million
n IIF Data Solutions to Pay $8.9 Million
n Join Taxpayers Against Fraud
n Baptist Health South to Pay $7.675 Million
n Zimmer to Pay Docs to Get Out of Kickback Scheme
n Tariff FCA Case Settled
n CSC to Pay $1.37 Million

May 11, 2008
n McKesson to Pay $13.25 Million
n CoxHealth Floats a Number
n Magical Millions
n Wackenhut Under the Glass

May 2, 2008
n UMDNJ Docs Sued for Kickbacks
n GSA's Lurita Doan Loses Job
n Are Fraud Files a Trade Secret?
n Savannah Hospital Pays $5 Million
n Cancer Doc Imports for Resale
n "Undercover" by John Schilling
n New York's Medicaid Work Plan

April 22, 200 8
n HHS Say "Tell Us More"
n It Takes a Village to Detect Fraud
n Positively Not Overnight
n Fraud Loophole Eliminated

April 15, 2007
n Radiologist to Pay $7 Million
n NC Dental Chain Pays $10 Million
n Heartland Dental Pays $3 Million
n OMB has Some Explaining to Do
n Entrepreneur of the Year?
n Ista Off-Label Investigation
n Fast Fact: Inflation-adjusting FCA Penalties

April 3, 2008
False Claims Act Amendments
Voted Out Senate Judiciary Committee

March 31, 2008
n Abilify Maker to Pay $4 Million
n HealthEssentials Not Likely to Pay Back Stolen Millions
n AWP Class Action Certified
n Derived Off-label Liability?
n Psychiatrist to Pay $1.1 Million

March 19, 2008
n CVS Pays $37 Million For Drug Switching
n InterMune CEO Charged
n Pfizer Sales Manager Indicted
n Mounting Zyprexa Liability
n Michigan Money on the Table

March 13, 2008
n Former Pfizer Manager Indicted for Obstruction
n Yale-New Haven Hospital Settles
n WellCare Hires a Fixer
n Precursor to an AWP Settlement?
n Besler to Pay $2.8 Million

March 6, 2008
n Allison Engine at Supreme Court
n Senate Judiciary Hearing on FCA
n Cathedral to Pay $5.3 Million

February 25, 2008
n Allison Engine to Supreme Court
n $215 Million Alabama Jury Award (non-FCA)
n Quest Reserves $241 Million
n Betting the House
n Wisconsin Passes State FCA

February 15, 2008
n Alabama Takes on Pharma Fraud
n Amgen Subpoenaed for Enbrel
n A Free-Fraud Zone?
n Counting False Claims Act Cases
n Fight Fraud: Remove The Cap

February 8, 2008
n Merck Settles for $650 Million
n Alabama AWP Trial to Start
n "Undercover" by John Schilling
n Finally A Treatment
n Lilly Sued Over Zyprexa as Settlement Rumors Swirl

January 30, 2008
n Big Dig False Claims Act Case
n Rhode Island False Claims Act Signed Into Law
n Feds Join NJ Outlier Cases
n Passion for Payola is Called . . .
n Washington Defines Success

u The Complete Newsletter Index

President Signs False Claims Act
Amendments Into Law
President Barack Obama has signed into law the Fraud Enforcement and Recovery Act (FERA), strengthening the ability of the Federal Government to go after fraudulent contractors. >> To read more | May 20, 2009

WellCare to Pay $80 Million

WellCare Health Plans has agreed to pay $80 million to settle charges the company inflated Medicaid charges in Florida. The settlement only applies only to Florida, and does not settle any other state or federal investigations of WellCare. >> To read more | May 5, 2009

Shipping Firm to Pay $26 Million
APL Ltd, a shipping firm in Oakland, California, has agreed to pay $26 million to settle a False Claims Act case in which the company was charged with knowingly overcharging and double-billing the Department of Defense in order to to transport thousands of containers from ports to inland delivery destinations in Iraq and Afghanistan. >> To read more | May 5, 2009

Fake Merck Journal Printed by Elsevier
Pharmaceutical giant Merck paid science publisher Elsevier to put out a fake peer-reviewed scientific journal called Australasian Journal of Bone and Joint Medicine. Elsevier is also the publisher of Health News Daily, The Gray Sheet (coverage of the medical device industry), The Pink Sheet (coverage of the prescription drug industry) and The Green Sheet (a publication for pharmacists)m which raises the question: What did Elsevier know, and when did it know it? >> To read more | May 5, 2009

Forest Reserves $170 Million
Forest Laboratories has set aside $170 million to settle a False Claims Act case related to the kickbacks paid to doctors for off-label prescription of the antidepressants Celexa and Lexapro to children as well as the off-label marketing of Levothroid. Forest notes that "there can be no assurance that the amount reserved by the Company will be sufficient and that a larger material amount will not be required." >> To read more | May 5, 2009

Maxxam Pays for Forest Fraud
Maxxam Inc., and its Chairman, Charles Hurwitz, have agreed to pay $4 million to settle a False Claims Act case in which the company is alleged to have lied and manipulated a sustainable yield plan in order to get the Federal Government to pay more than it should have to acquire Pacific Lumber redwood forest assets as part of the Headwaters Forest preservation plan. >> To read more | May 5, 2009

DoJ Joins HSUS Lawsuit
Against Slaughterhouse
The U.S. Department of Justice has joined a False Claims Act lawsuit filed by the U.S. Humane Society against a Southern California slaughterhouse whose workers were videotaped pushing "downer" cows down a chute to be processed for meat. Westland-Hallmark Meat Co. was, at one time, the second largest supplier of hamburger meat to the National School Lunch Program, and fraudulently certified that no meat from "downer" cows entered the food supply. >> To read more | May 5, 2009

KBR is Named in Majority of Iraq Frauds

April Stephenson, head of the Pentagon’s contract audit agency, says Kellog Brown and Root (KBR) is named in the “vast majority” of 32 cases referred by government auditors for criminal investigation. She told the Wartime Contracting Commission that in the agency’s history, “I don’t think we are aware of a program, a contract or a contractor that’s had this number” of referrals. >> To read more | May 5, 2009

Quest Diagnostics to Pay $302 Million
Quest Diagnostics has agreed to pay $302 million to settle civil and criminal charges related to a Quest subsidiary which sold a parathyroid hormone immunoassay test which reported elevated results. The inaccurate diagnostic test kit resulted in medical providers submitting false claims for reimbursement to federal health programs. The settlement includes $262 million paid under the federal False Claims Act, $6.2 million paid to the states, and a criminal fine of $40 million. Thomas Cantor, founder, president and owner of Scantibodies Laboratory Inc., filed the whistleblower lawsuit, and will receive approximately $45 million for his work, and the work of his attorneys, in bringing the case. >> To read more | April 14, 2009

NetApp to Pay $128 Million

Network Appliance Inc. has agreed to pay $128 million to settle a False Claims Act case involving best price violations. This settlement is the largest corporate fraud settlement in Government Services Administration (GSA) history. The case was filed by Igor Kapuscinski, who will receive $19.2 million for his work, and the work of his attorneys, in bringing the case. >> To read more | April 14, 2009

Custer Battles Must Pay
The Fourth Circuit has reversed a district court judge who set aside a $10 million jury verdict against Iraq war contractor Custer Battles on the basis that fraud against the Coalition Provision Authority and Iraq were not covered under the FCA, even if U.S. personnel were making all payment decisions. The Fourth Circuit disagreed, effectively ending the notion that Iraq is a "free fraud zones." >> To read more | April 14, 2009

Northrop to Pay $325 Million in Satellite Case
Northrop Grumman has agreed to pay $325 million to settle a False Claims Act lawsuit that alleged TRW (now owned by Northrop) made defective parts for spy satellites that resulted in serious malfunctions and expensive fixes, all charged to U.S. taxpayers. The Northrop settlement is the largest military-procurement fraud whistleblower case to date, and was brought by Robert Ferro, an Aerospace Corp. official who first discovered the problem in 1995 and brought it to TRW's attention. The problem went uncorrected and satellites failed. When TRW engaged in a cover up, Mr. Ferro decided to blow the whistle, and he will be awarded $48.7 million for his work, and the work of his attorneys, in bringing the case. >> To read more | April 10, 2009

TAF Testifies in Support of FCA Amendments
TAF President Jeb White testified before the House Judiciary Committee in support of H.R. 1788, the False Claims Act Corrections Act of 2009, noting that the bill would "significantly enhance the Government’s ability to identify, prosecute and deter fraud on U.S. Government programs" by closing and correcting a number of loopholes that fraud-feasors have used and abused to drain billions of dollars from the U.S. Treasury. The FCA Corrections Act would also modernize the law to address new types of fraudulent schemes, and clarify procedural questions, while strengthening the Government’s Civil Investigative Demand authority. >> To read the testimony (PDF) | April 2, 2009

California Sues Seven Labs
California is suing seven private medical labs, alleging they cost the state hundreds of millions of dollars by overcharging Medi-Cal by as much as 400 percent. The whistleblower in this case is Chris Riedel, CEO of Hunter Laboratories, who refused to join in the price-gouging practices. The seven defendants are: Quest Diagnostics; Health Line Clinical Labs; Westcliff Medical Labs; Physicians Immunodiagnostic Laboratory; Whitefield Medical Laboratory; Seacliff Diagnostics Medical Group, and; Laboratory Corporation of America. >> To read the complaint (PDF) | April 2, 2009

Risperdal Marketed Off-label
Three former salespeople have filed suit against Pharmaceutica alleging the company engaged in off-label marketing of antipsychotic drug Risperdal. According to the lawsuit, company salespeople were encouraged to push the drug to doctors as a treatment for bipolar disorder and depression. Risperdal generated $3.4 billion in sales in 2008. >> To read more | March 17, 2009

Healthways Hopes to Settle

Healthways Inc. has taken a $40 million charge in anticipation of settling an FCA lawsuit filed 15 years ago by A. Scott Pogue, a former employee of Diabetes Treatment Center of America business. The lawsuit alleges Diabetes Treatment illegally paid doctors for referrals. The U.S. Government did not join the suit, but will collect more than $28 million nonetheless. >> To read more

| March 17, 2009

Massive Amgen Fraud Case
An unidentified whistleblower has filed a False Claims Act case against Amgen, the biotechnology company which makes arthritis and psoriasis drug Enbrel, and anti-anemia drug Aranesp. Amerisource-Bergen and online health-information provider WebMD Health Corp are also named. The case came out from under seal at a judge's directive, and DoJ is still deciding if it will join. The case involves off-label marketing, kickbacks and Medicaid best price violations. >> To read more | March 10, 2009

US Joins Against NM Hospitals
DoJ has joined a False Claims Act case against Community Health Systems Inc., and three of its hospitals in New Mexico. CHS is charged with violating the FCA by knowingly causing to be presented false claims for federal matching Medicaid funds. CHS paid New Mexico counties knowing that the money would then be used to illegally obtain triple that amount in federal funding, which would then be paid back to CHS under New Mexico's Medicaid program. >> To read more | March 10, 2009

DoJ Joins Against Forest
DoJ has charged Forest Laboratories with defrauding the government by illegally marketing the antidepressants Celexa and Lexapro for unapproved use in children and teenagers. Prosecutors charge former top executives at Forest with concealing a clinical study that showed that Celexa and Lexapro were not effective in children and might even pose risks, including causing some to become suicidal. >> To read more | March 10, 2009

Pharma Lawyers Now Driving
Billion Dollar Settlements
Would $1,000-an-hour lawyers for big pharmaceutical companies continue to litigate if they were paid only if they won? That's a question pharmacy company executives might want to start asking in the wake of the fifth straight loss in an Average Wholesale Price case at the state level. Here's how the cases line up by state, company, and jury verdict, with the last number a "national number" when the state verdict is weighted by population:

4Alabama - AstraZeneca - $215 million - $14.06 billion
4Alabama - GlaxoSmithKline - $81 million - $5.29 billion
4Alabama - Novartis -- $33 million - $2.15 billion
4Missouri - Schering-Plough - $107 million - $5.55 billion
4Wisconsin - Pfizer - $153 million - $8.7 billion

The Wisconsin verdict is the latest blow to the pharmaceutical industry, but it will not be the last as Sandoz is about to go to trial in Alabama and dozens of other companies are lined up behind that. | Feb. 24, 2009

Shipping Firm to Pay $26 Million
APL Ltd, an Oakland, California shipping company has agreed to pay the U.S. Government $26.3 million to settle a False Claims Act case charging it with fraudulently inflating bills for shipping cargo to the U.S. military in Iraq and Afghanistan. >> To read more | Feb. 24, 2009

DoJ Joins FCA Suit Against
Scios and Johnson & Johnson
The U.S. Justice Department has joined two whistleblower lawsuits alleging that Johnson & Johnson and Scios engaged in off-label marketing of the cardiac drug Natrecor. >>To read more | Feb. 24, 2009

IRS Whistleblower Case
Settled for $780 Million
UBS AG, Switzerland’s largest bank, will pay $780 million to settle charges it helped thousands of wealthy Americans evade taxes. UBS settled after Heinrich Kieber, a former employee of a Liechtenstein bank, brought documents to the IRS detailing massive tax cheating by U.S. citizens. >> To read more | Feb. 24, 2009

Katrina Case Reinstated
The U.S. Fifth Circuit Court of Appeals has reinstated a New Orleans whistleblower lawsuit against insurers that allegedly overbilled the National Flood Insurance Program after Hurricane Katrina. The lawsuit, by Branch Consultants, was dismissed in October of 2007 on the grounds that its core allegations were already covered by a rival whistleblower suit in Mississippi. >> To read more | Feb. 24, 2009

AT&T Pays $8.2 Million
AT&T has agreed to pay over $8.2 million to settle charges it violated the False Claims Act in connection with the Federal Communication Commission's E-Rate program which is designed to bring the Internet to poor or under-served schools. >> To read more | Feb. 24, 2009

Glaxo's $400 Million Reserve

GlaxoSmithKline has reserved $400 million to settle off-label and kick back charges related to "several products” sold from 1997 to 2004, including the antidepressant Wellbutrin. Glaxo said the reserve “reflects the current status of the [DoJ] investigation." >> To read more | Feb. 10, 2009

Pfizer Reserves $2.3 Billion
Pfizer's recent SEC report notes the company has reserved $2.3 billion "resulting from an agreement in principle to resolve previously disclosed investigations regarding allegations of past off-label promotional practices concerning Bextra, as well as other open investigations." When a settlement occurs, this will make Bextra the largest single settlement with an FCA component, dwarfing Eli Lilly's $1.4 billion settlement announced just last week. >> To read more | Jan. 27, 2009

Lilly Pays Record $1.4 Billion
for Zyprexa Fraud
In the largest single settlement with a False Claims Act component, Eli Lilly has agreed to pay $1.4 billion to settle charges it defrauded Medicare and Medicaid by off-label marketing of Zyprexa. The drug was promoted to nursing homes to treat dementia, which it does not do. Of the $1.4 billion settlement, $800 million was paid under the FCA, and $615 million was a criminal penalty (a $515 million fine and asset forfeiture of $100 million). | Jan. 10, 2009
>> Press Release | Information | Guilty Plea Agreement | Government's Memorandum For Entry Of Plea and Sentencing

AL Hospice to Pay $25 Million

SouthernCare Inc., an Alabama-based hospice company, has agreed to pay $24.7 million to settle charges it billed Medicare for ineligible patients. The company operates 99 locations in 15 states. >> To read more

FDA Approved Hundreds
of Medical Devices Without Review
The U.S. Government Accountability Office says hundreds of medical devices have been approved by the FDA without a full-scale review. Some of these items have since been recalled, including an external defibrillator for treating heart attack victims, but many have not. >> To read more

Updated Advising the Qui Tam Whistleblower
The second edition of the bestselling Advising the Qui Tam Whistleblower by Robin Page West is now available from the American Bar Association, with a portion of the proceeds to come back to TAF. This publication provides complete and concise information to assist an attorney in evaluating a client's potential claim, and to determine whether pursuit of a qui tam action is warranted. The handy guide provides an overview of the statute, highlights common and controversial topics, and contains updated statistics as well as a discussion of the recent Supreme Court Allison Engine case, as well as updated case law on the defenses of:

Government knowledge/lack of intent
Constitutionality
Lack of Rule 9(b) specificity
Lack of presentment
Public disclosure/not original source
Limitations
Lack of falsity
Materiality
Counterclaims
Improper relator: pro se, government employee or deceased
Relator-released claims

Advising the Qui Tam Whistleblower: From Identifying a Case to Filing Under the False Claims Act, also present information on:

Submitting false cost and pricing data
Providing an inferior product
Falsely certified medical procedures
Tax law
Parasitic suits

Use this volume as a starting point for further thinking. Nine companion forms are included. >> To order

Bayer Healthcare to Pay U.S. $97.5 Million
Bayer HealthCare has agreed to pay the United States over $97.5 million to settle allegations it paid kickbacks to several diabetic suppliers, causing those suppliers to submit false claims to Medicare. The cash-for-patient scheme involved 11 diabetic supply companies which were paid kickbacks to convert their patients from other suppliers to Bayer products. >> To read more

FY 2008 FCA Statistics
The U.S. Department of Justice reports they secured $1.34 billion in settlements and judgments in the fiscal year ending Sept. 30, 2008, but the actual number is actually much higher than that. Why the lower number? Simple: for statistical purposes, the DoJ does not count the money won in settlements that is subsequently handed over to the states, nor does it count criminal penalties. These can quickly add up. For example, in the DoJ's recent release, they count the Merck FCA recovery at $361.5 million even though the DoJ's own press release says the total was $650 million. In the Cephalon case, DoJ reports a $375 million recovery even though the DoJ's own press release says the total was $425 million. In the Staten Island University Hospital case, DoJ reports $74 million while the press reports the full figure of over $88 million which includes the recovery to the state. The DoJ's most recent press release list the CVS False Claims Act case as a $21 million recovery, even though their earlier press release put the figure at $37 million. So how much money did the False Claims Act actually return last year according to our records? A little over $2 billion. | Nov. 12, 2008

Home Health Care Fraud in FL

In October, Medicare suspended millions of dollars in payments to the top 10 home healthcare agencies in Miami after discovering that since 2001 Medicare's payments for home healthcare in Dade County had grown by a whopping 1,750 percent -- to $1.3 billion -- while the pool of people over age 65 diagnosed with diabetes had grown by just 30 percent. To put it another way, Medicare's payments for home healthcare in Miami-Dade grew at a pace 13 times the national rate. Medicare officials say that right now about one in every 15 Medicare dollars spent on home healthcare in the U.S. is spent in Miami-Dade County alone. >> To read more | Nov. 21, 2008

Vytorin in 35-state Off-Label Investigation
DoJ and 35 state Attorney Generals offices are investigating whether Merck and Schering-Plough improperly promoted the cholesterol drug Vytorin. Merck says it has received five “civil investigative demands” from a multistate group so far. >> To read more | Nov. 12, 2008

$52 Million for Bad Blades
Pratt & Whitney and PCC Airfoils have agreed to pay $52 million to settle allegations they knowingly sold defective turbines for fighter jets. >> To read more | Nov. 21, 2008

$160 Million in Los Angeles Utilities Case

The Los Angeles Department of Water and Power (DWP) has decided not to appeal last year's court verdict and will pay Los Angeles County, the Los Angeles Unified School District, the Los Angeles Community College District and certain state agencies a total of $160 million to settle the largest recovery ever made against a utility company for overcharging customers. >> To read more | October 28, 2008

Jury Finds Unum Defrauded Taxpayers

A jury has found Unum the Group defrauded U.S. taxpayers by forcing customers to submit false claims for disability benefits to the Social Security Administration. Damages in this case, brought by whistleblower Patrick Loughren, will be assessed in future hearings. Unum had nearly 500,000 long-term disability claimants over the period covered by this case. >> To read more | October 23, 2008

Uncle Sam vs. McKesson Corp.
The U.S. Department of Justice has intervened in a False Claims Act case against McKesson and several nursing home facilities and companies alleging a pattern of illegal kickbacks, and the establishment of sham durable medical equipment (DME) suppliers. >> To read more | October 7, 2008

Cephalon Pays $425 Million
Cephalon, a biotech company, has settled a massive off-label marketing case for $425 million. The case involved off-label marketing of Actiq (a narcotic lollipop designed for pain control in cancer patients), Gabitril (an epilepsy medication) and Provigil (a narcolepsy medication). Of the $425 million settlement, $50 million is a criminal fine and $375 million is to be paid as part of a civil settlement of Medicare and Medicaid claims under the False Claims Act. The massive fraud was first brought to the government's attention by four whistleblowers, all of whom will share in the proceeds of the recovery.

As part of Cephalon's Corporate Integrity Agreement, the company will have to post on its website a searchable database of all physicians who acted as speakers or consulted for the company during 2009. Beginning the first quarter of 2011, Cephalon will have to name doctors who receive any payments from the company during the previous calendar year and say (roughly) how much they received.
4 Three press releases : 1 , 2 , 3
4 Settlement agreement (PDF)
4 Corporate integrity agreement
4 Plea agreement & sentencing | October 1, 2008

NY Hospital to pay $88 Million
Staten Island University Hospital (SIUH) has agreed to pay the United States and the state of New York over $88.9 million to settle claims the hospital defrauded Medicare, Medicaid and the military’s health insurance program. This is the third time SIUH has been nailed for fraud. Previous cases were settled for $45 million (1999) and $76.5 million (2005). >> To read more | September 17, 2008

Abbott Pays $28 Million to TX
Abbott Laboratories has agreed to pay $28 million to settle Medicaid-fraud charges under the Texas False Claims Act. Abbott misreported drug prices to Medicaid, causing the state to significantly overpay for prescription drugs. The Texas case was brought by Ven-a-Care of the Florida Keys, which has previously won FCA cases against Schering-Plough/Warrick Pharmaceuticals, Dey, Boehringer Ingelheim/Roxane Laboratories, Baxter Healthcare Corp., and Fresenius. The U.S. Department of Justice has joined a similar case, also against Abbott, brought by Ven-a-Care.
>> Texas settlement with Abbott | September 17, 2008

Taxpayers Against Fraud 2008 Award Winners
4Lifetime Achievement: James Helmer
4Lawyer of the Year: Steve Cohen, Mark Kleiman, and BethAnne Yeager
4Whistleblower of the Year: Sherry Scharff and Walter T. “Tom” Decyk
4Honest Abe Integrity in Government Award to Congressman Dan Lungren (R-CA)
>> To read more

Healthfirst to Pay NY $35 Million
Healthfirst, the largest Medicaid Managed Care provider in New York, will pay $35 million to settle allegations it violated state and federal contracts by paying bonuses to employees based on the number of people they enrolled in managed care. >> To read more | September 17, 2008

Maxwell Case Reversed
The same week the Dept. of Interior's Inspector General issued a report noting some Minerals Management Service employees in Denver were accepting gifts and having sex with representatives of the oil and gas industry, reversed a lower court decision throwing out a $30 million jury verdict against Kerr-McGee for knowing underpayment of royalties. >> To read decision
| September 17, 2008

More States Qualify Under DRA
The Office of the Inspector General of HHS has qualified four more states under the Deficit Reduction Act of 2005. The four states are CA, IN, RI, and GA.>> For a listing of state False Claims Acts |Aug. 6, 2008

Pratt to Pay $52 Million
Pratt & Whitney and a subcontractor have agreed to pay more than $52 million to settle False Claims Act charges the company knowingly sold defective turbine blades for F-15 and F-16 fighter jet engines used by the Air Force. >> To read more |Aug. 6, 2008

Conflict of Interest FCA
Science Applications International Corporation (SAIC) was found guilty of violating the False Claims Act and breaching a contract with the Nuclear Regulatory Commission. The federal jury awarded the U.S. $5.91 million under the False Claims Act with additional penalties of between $5,000 and $10,000 for each of 77 false claims and statements. The case is the first conflict of interest claim under the FCA. >> To read more |Aug. 6, 2008

CoxHealth To Pay $60 Million

CoxHealth has agreed to pay more than $60 million to settled a False Claims Act lawsuit in which the company was charged with overbilling Medicare. CoxHealth actually stole more money that they are being required to return to the U.S. Government because as federal agents began calculating the damages, it soon became clear Cox could not pay without going under. >> To read |Aug. 6, 2008 more

Justice Probes Bile Stent Fraud
The U.S. Attorney's Office in Boston is investigating the marketing of bile-duct stent to determine if companies such as Abbott Laboratories, Boston Scientific and Johnson & Johnson have been engaged in off-label marketing of the stents to cardiac surgeons and hospitals. >> To read more |Aug. 6, 2008

Amerigroup Settles for $225 Million
After losing at trial, Amerigroup insurance has agreed to pay $225 million to the U.S. and the state of Illinois to settle False Claims Act charges. The company faced a $334 million judgment -- the largest in the 20-year history of the FCA. Amerigroup will also pay $9 million in legal fees and sign a corporate integrity. The FCA case charged the company with illegally denying Medicaid coverage to pregnant women in Illinois. >> To read more |July 28, 2008

House Judiciary Committee
Reports Out FCA Bill
The House Judiciary Committee has reported out, by voice vote, H.R. 4854, the False Claims Act Correction Act of 2007. The bill, introduced on December 19, 2007, would clarify and strengthen the False Claims Act which has been weakened by recent court decisions. |July 16, 2008

Ranbaxy Under Investigation
Ranbaxy, one of the largest drug companies in the world, is under investigation for making weak or adulterated HIV drugs given to thousa nds of AIDS patients in Africa and billed to the U.S. Government under the President's Emergency Plan for AIDS Relief program (PEPFAR). Ranbaxy is also being investigated for lying about its Zocor formulation sold in the U.S. >> To read more |July 16, 2008

TX Joins Lawsuit Against Four Drug Companies
Texas has recently joined lawsuits against four generic drug manufacturers that falsely reported inflated drug prices to the Texas Medicaid program. The drug companies are Watson/Schein Pharmaceuticals Inc. of California; Alpharma Inc. of New Jersey; Par Pharmaceutical Inc. of New Jersey; and Barr Pharmaceuticals Inc. of New York. The Texas False Claims Act legal action was initiated by Ven-a-Care of the Florida Keys Inc. which has previously initiated Medicare and Medicaid fraud actions that have returned over $850 million to the American people. >> To read more |July 16, 2008

Supreme Court Remands Allison Engine Case

The Supreme Court ruled unanimously that the False Claims Act applies to subcontractors and other indirect recipients of federal funds, but that the subcontractor must intend the government to rely on a fraudulent claim in order to get paid. The Supreme Court sent the Allison Engine case back to the 6th U.S. Circuit Court of Appeals in Cincinnati to apply the standard it laid out. >> To read the opinion (PDF) | June 10 2008

Walgreens Pays $35 Million
Walgreens is the third national pharmacy chain to settle drug switching allegations exposed by a whistleblowing pharmacist whose actions have helped return more than $120 million to federal and state governments. Current charges involve Walgreens switching dosage forms in filling generic Prozac, Zantac and Eldepryl prescriptions paid for by Medicaid. >> To read more | June 4 2008

Pasha Settles for $13 Million

The Pasha Group has agreed to pay $13 million to settle FCA charges alleging the company engaged in bid-rigging in connection with furniture shipments for the Dept. of Defense. Five other companies are implicated. >> To read more | June 4 2008

Medtronic/ Kyphon Settle for $75 Million

Medtronic Spine, formerly known as Kyphon Inc., has agreed to pay $75 million to settle a False Claims Act lawsuit which exposed the company's sales and pricing strategy which was designed to further fraud against Medicare. The case was filed by whistleblowers Craig Patrick and Chuck Bate, who will receive $14.9 million of the settlement as an award for helping uncover and prosecute the fraud on behalf of the American government and its taxpayers. >> To read more | May 28, 2008

Biovail To Pay $25 Million
Biovail Corporation says it will pay $25 million to settle criminal allegations related to kickbacks paid to doctors in order to induce them to prescribe Cardizem. The probe began after reports in The Wall Street Journal and Barron's revealed Biovail was paying doctors up to $1,000 each to write prescriptions for Cardizem LA and write reports on the drug -- a kind of Phase IV marketing scam. >> To read more | May 20, 2008

Lockheed Martin Space
Systems to Pay $10.5 Million
Lockheed Martin Space Systems has agreed to pay $10.5 million to settle a case alleging the company submitted false invoices in order to receive early progress payments. The fraud is connected to a multi-billion dollar contract for the Titan IV space launch program. >> To read more | May 20, 2008

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$215 Million Alabama Jury Award Sends Message on Average Wholesale Price Fraud
AstraZeneca was hit with a $215 million judgment in Alabama over Medicaid drug pricing fraud. The jury said AstraZeneca must pay $40 million in compensatory damages and $175 million in punitive damages for alleged false and misleading reporting of drug prices reimbursed by the Alabama State Medicaid Agency. Remember, this is just one drug company in one state. If we scale up the compensatory award alone, based on population, AstraZeneca seems to face a potential liability of $2.4 billion for Average Wholesale Price and Medicaid Best Price violations. AstraZeneca is just one of more than 75 drug companies in line to face similar charges in Alabama. Though the Alabama litigation is not a False Claims Act case, more than 60 companies face similar charges, under the federal False Claims Act, up in Boston. These companies include: Abbott, Roxane, Dey, Boehringer Ingelheim, Amgen, Armour Pharmaceutical; Aventis Pharmaceuticals, Baxter Healthcare, Bedford Laboratories; Ben Venue Laboratories, Braun of America, C.H. Boehringer Sohn, Centocorps Inc., Forest Pharmaceuticals, Grundstucksverwaltung GMBH & Co., EMD, Geneva Pharmaceuticals, GlaxoSmithKline, Glaxo Wellcome, Burroughs Wellcome, Hoechst Marion Roussell, Hoffman-LaRoche, Hospira Inc., Immunex, Ivax Pharmaceuticals, Janssen Pharmaceutical Products, Johnson & Johnson, Lipha, McGaw, Merck, Mylan Laboratories, Mylan Pharmaceuticals, Novartis, Ortho Biotech Products, Pfizer, Pharmacia, Pharma Investment, PurePac Pharmaceutical, Roche Laboratories, Roxane Laboratories, Sandoz, Sicor, Gensia Pharmaceuticals, Schering-Plough Corp., SmithKline Beecham Corp., GlaxoSmithKline, Teva Pharmaceuticals, Warrick Pharmaceuticals, and Z.L.B. Behring, among others.

Quest Reserves $241 Million
Quest Diagnostics has increased its litigation reserves to $241 million, noting that this amount "represents the minimum expected probable loss" due to False Claims Act litigation related to the government investigation of NID, a test-kit manufacturing subsidiary closed in 2006. Settlement talks with the U.S. Government are ongoing. >> To read more

New Jersey False Claims Act Signed Into Law
It's not often that both the New Jersey Senate and Assembly give a unanimous vote in support of a piece of legislation, but that's what happened with the New Jersey False Claims Act, which has now been signed into law by Governor John Corzine. >> For a complete list of state FCA's | Jan. 23, 2008

HealthSouth Pays $14.9 Million
HealthSouth and two doctors have agreed to pay $14.9 million ($14.2 million to be paid by the company and $700,000 to be paid by the two doctors) to settle charges the company was submitting false claims to Medicare and paying illegal kickbacks to referring physicians. The settlement results from disclosures made by HealthSouth in 2004 and 2005 to the U.S. Attorney for the Northern District of Alabama. >> To read more | Dec. 18, 2007

Bristol-Myers Squibb to Pay $515 Million
Bristol-Myers Squibb has agreed to pay $515 million to settle allegations brought in seven qui tam cases (six in Boston and one in Florida) involved pricing and promotional activities (including kickbacks to doctors) for more than 50 drugs, including 13 drugs with a combined 2007 sales of $10.7 billion -- a total of 69 percent of Bristol-Myers' 2007 pharmaceutical revenue. Drugs included in this settlement include the blood thinner Plavix, antipsychotic Abilify, the cholesterol treatment Pravachol, the cancer therapy Taxol, and the antidepressant, Serzone. Of the $515 million, approximately $328 million will be paid under the Federal False Claims Act, with the state's getting a total of $187 million. >> To read more | Sept. 28, 2007

Artificial Hip and Knee Joint Companies to
Pay $310 Million to Settle Kickback Charges
Five orthotics companies, which account for nearly 95 percent of the hip and knee surgical implants sold in the United States, have agreed to pay $310 million in order to avoid criminal prosecution for paying kickbacks to surgeons in order to get them to choose their products. >> To read more (PDF) |Sept. 26, 2007

Faulty Flares Ignite Lawsuit
The Dept. of Justice has joined a whistleblower lawsuit alleging that ATK Thiokol Inc. made defective battlefield flares that can ignite if dropped from a height of as low as 3 feet. The defective flares cost from $700 to $1,000 each, and the U.S. Army and Air Force paid ATK more than $100 million for the product. >> To read more | June 26, 2007

TAF Files Amicus in War Case
The TAF Education Fund and the U.S. DoJ have filed amicus curiae briefs in support of the relator in the Custer Battles Iraq fraud case. The relator won a jury trial, but the judge overturned the decision. >> To read the TAF & DoJ Briefs (PDF) | June 12, 200

$634 Million FCA Settlement for OxyContin
Purdue Frederick Co. and three of its executives have pled guilty to misbranding prescription painkiller OxyContin and will pay more than $634.5 million, including a $276 million criminal fine, $160 under federal and state false claims acts, and $130 million to settle private civil claims.
In announcing the settlement, U.S. Attorney John Brownlee of the Western District of Virginia, noted that "In the process [of illegally marketing the drug], scores died ... and an even greater number became addicted." >> To read more | May 15, 2007

A Record $334 Million FCA Judgment
Amerigroup was found liable, in a trial by jury, in a False Claims Act case in which the company was accused of discriminating against pregnant women who were supposed to be recruited into a state-sponsored Medicaid HMO. Losing the case triggered automatic triple damages of $144 million. An additional $190 million in statutory fines were levied by U.S. District Judge Harry Leinenweber who noted that Amerigroup "pilfered money from Medicaid coffers to pad its own pockets." The Amerigroup case, was brought by whistleblower Cleveland A. Tyson and was joined by both the U.S. Department of Justice and the Illinois Attorney General's office. >> To read more | March 14, 2007

$3.9 Billion in Pharmaceutical Fraud
Is Just the Tip of the Iceberg

Taxpayers Against Fraud Education Fund has released a new study which notes that in the last two years, pharmaceutical manufacturers have paid a total of $1.6 billion to resolve allegations of Medicare and Medicaid fraud, but that these cases represent just the tip of the iceberg as more than 180 additional cases remain under seal, representing scores of billions of additional stolen dollars.

In total, more than $3.9 billion has been recovered from drug manufacturers over the past six years as the result of just 16 cases brought by whistleblowers under the False Claims Act
Of the six False Claims Act cases that were settled in Fiscal Years 2005 and 2006, all involved fraud against Medicaid, and all were initiated by whistleblowers. >> To read more | March 07, 2007

Drug Companies May Have To Return
More of America's Stolen Billions
The U.S. Department of Justice has joined a False Claims Act case filed by Ven-a-Care of the Florida Keys against Roxane Laboratories Inc. and Boehringer Ingelheim Pharmaceuticals for Medicaid and Medicare drug pricing violations. This federal action comes more than a year after Roxane and Boehringer paid $10 million to settle a Texas False Claims Act case alleging similar misconduct involving misrepresentations about the "Average Wholesale Price" of prescription drugs sold to Medicaid. In announcing their intervention in the case, the U.S. Department of Justice noted that "The United States alleges that Medicare and Medicaid have reimbursed Roxane's customers in excess of $500 million for the drugs which are the subject of the complaint."
     The Roxane Labs case joins a similar case against Abbott Laboratories by Ven-a-Care that the U.S. Department of Justice joined in May of 2006, and another against Dey Pharmaceuticals that the DoJ joined in September of 2006.
     Complaints against more than 40 additional companies engaged in Average Wholesale Price violations have been filed in Federal and State courts. Along with Abbott, Roxane, Dey and Boehringer Ingelheim, defendants in intervened cases include (but are not limited to): Amgen, Armour Pharmaceutical; Aventis Pharmaceuticals, Baxter Healthcare, Bedford Laboratories; Ben Venue Laboratories, Braun of America, C.H. Boehringer Sohn, Centocorps Inc., Forest Pharmaceuticals, Grundstucksverwaltung GMBH & Co., EMD, Geneva Pharmaceuticals, GlaxoSmithKline, Glaxo Wellcome, Burroughs Wellcome, Hoechst Marion Roussell, Hoffman-LaRoche, Hospira Inc., Immunex, Ivax Pharmaceuticals, Janssen Pharmaceutical Products, Johnson & Johnson, Lipha, McGaw, Merck, Mylan Laboratories, Mylan Pharmaceuticals, Novartis, Ortho Biotech Products, Pfizer, Pharmacia, Pharma Investment, PurePac Pharmaceutical, Roche Laboratories, Roxane Laboratories, Sandoz, Sicor, Gensia Pharmaceuticals, Schering-Plough Corp., SmithKline Beecham Corp., GlaxoSmithKline, Teva Pharmaceuticals, Warrick Pharmaceuticals, Z.L.B. Behring.
    While "the rock" of the U.S. Department of Justice squeezes pharmaceutical companies from one side, a potential "hard spot" can be found in the courtroom of U.S. District Judge Patti Saris who ruled in November that "Average Wholesale Price" means exactly what the dictionary says it does, and is not a "term of art" that the drug companies can unilaterally define. Judge Saris' November ruling suggests that the pharmaceutical industry may face real difficulties in her courtroom.
     Back in November, we predicted that more Average Wholesale Price cases would come to resolution in 2007, in part to avoid the high cost of courtroom failure (mandatory triple damages, plus mandatory statutory fines and exclusion). In late December, Bristol-Myers Squibb was the first company to work out a settlement of both its AWP cases and an off-label marketing case for a combined total of $499 million. More cases are sure to follow. Stay tuned.

FCA Recoveries Over $22 Billion
Total False Claims Act recoveries (Federal and State) since the 1986 amendments now total over $20 billion. To put this into perspective, the $22 billion recovered from fraud-feasors to date represents a stack of $100 bills more than 21 miles high. In the health care arena, the U.S. Government is recovering $15 back for every $1 invested in False Claims Act health care investigations and prosecutions. | Dec. 10, 2008

Fighting Healthcare Fraud:
Whistleblower Statute Returns
$15 for Every $1 Invested
A TAF report by economist Jack Meyer, concludes that every dollar invested by the U.S. Government in investigation and prosecution of federal health care fraud returns $15 back to the American people -- a phenomenal rate of direct return that does not factor in the benefits of fraud deterrence. >> To read more | August 2, 2006

One Click Statistics Sheet
A simple one-click presentation (6 PDF pages) of official Department of Justice False Claims Act Statistics for FY 1987-2008 can be found >> here (note that this table does not include recoveries to the states in Medicaid cases, nor does it include criminal fines collected as an outgrowth of FCA cases).

Pharma Lies for Pharma Profits
How lucrative are the lies told by prescription drug manufacturers? Very! The table below, assembled from the recent State of Florida's False Claims Act complaint against Mylan, Teva, and Watson pharmaceuticals, shows how drug companies capture market share at the expense of U.S. taxpayers. >> To learn more about "marketing the spread" frauds.

Drug and Company	Reported Wholesale Acquisition Cost (WAC)	Florida Medicaid cost based on WAC	Actual pharmacy cost of buying drugs	Difference in $	Spread as percent of actual
Rantidine, 150mg tablet (Mylan)	$14.00	$14.98	$2.88	$12.10	420%
Clonazepam, .5mg tablet per 100 (Teva)	$9.31	$9.96	$4.49	$5.47	122%
Carisoprodol,350mg tablet (Watson)	$363.40	$388.84	$113.10	$275.74	244%

A Tally of FCA Fraud Cases by Pharmaceutical Manufacturers
(Note: Total may include criminal fines and state claims associated with FCA actions)

Company	Settlement Date	Product	Total Recovery	Fraud Type	Whistleblower
Abbott	9/17/08		$28 Million under TX FCA	Marketing the spread and concealment of best price	Independent pharmacy
AstraZeneca	6/20/03	Zoladex	$355 million	Marketing the spread and concealment of best price	Sales exec from competitor at TAP Pharmaceuticals
Aventis	9/10/07	Anzemet	$190 Million	Marketing the spread	Independent pharmacy
Baxter International	6/13/06	Generic drugs made by Baxter	$8.5 million	Marketing the spread	Independent pharmacy
Bayer l	1/23/01	Kogenate, Koate-HP, Gamimmune	$14 million	Marketing the spread and concealment of best price	Independent pharmacy
Bayer II	4/15/03	Adelat CC, Cipro	$257 million	Concealment of best price	Bayer marketing executive
Bristol-Myers Squibb	12/15/06	Abilify and other drugs	$499 million	Marketing the spread on a variety of drugs and off-label marketing of the schizophrenia and bipolar disorder drug Abilify.	Independent pharmacy and other relators
Cephalon	11/14/2007	Actiq (fentanly citrate	$425 million	Off-label marketing of narcotic lollipop	Four former Cephalon sales representative s
Dey I	6/11/03	Albuterol	$18.5 million	Marketing the spread	Independent pharmacy
Dey 2 (Connecticut FCA)	8/7/04	Albuterol	$2.5 million	Marketing the spread	Independent pharmacy
GlaxoSmithKline I	4/16/03	Paxil, Flonase	$88 million	Concealment of best price	Derived from Bayer marketing executive allegations.
GlaxoSmithKline II	9/17/05	Zofran, Kytril	$150 million	Marketing the spread	Independent pharmacy
InterMune	10/26/06	Actimmune	$36.8 million	Off-label marketing
King Pharmaceutical	10/30/05	Altace, Aplisol, Lorabid, and Fluogen	$124 million	Concealment of best price	Executive of King Pharmaceuticals
Eli Lilly	1/22/09	Zyprexa	$1.42 billion ($438 million under Federal FCA, $361 million to state, and $515 million to the states)	Off-label marketing	Several former company employees
Merck	2/7/08	Vioxx, Pepcid, Zocor	$650 million	Nominal pricing fraud (kickback)	A doctor and a former Merck district manager
Otsuka Pharmaceutical	3/27/08	Abilify	$4 million	Off-label marketing
Pfizer l	10/28/02	Lipitor	$49 million	Concealment of best price	National account manager for Pfizer subsidiary
Pfizer ll	5/13/04	Neurontin	$430 million	Off-label marketing	Medical liaison to physicians for Pfizer subsidiary
Purdue Pharma	5/15/07	Oxycotin	$634 million	Off-label marketing	No relator
Roxane Labs, Boehringer Ingelheim Pharmaceuticals, and Ben Venue Laboratories (Texas FCA)	11/25/05	Albuterol	$10 million	Marketing the spread	Independent pharmacy
Schering-Plough l	5/3/04	Albuterol	$27 million	Marketing the spread	Independent pharmacy
Schering-Plough ll	7/29/04	Claritin	$345 million	Concealment of best price	Three employees of Schering-Plough subsidiary
Schering-Plough lll	8/26/06	Temodar, Intron-A, K-Dur, Claritin RediTabs	$435 million	Concealment of best price, Marketing the spread	Three employees of Schering-Plough
Serono	10/17/05	Serostim	$704 million	Off-label marketing and kickbacks	Five Serono employees in two states.
TAP Pharmaceuticals	10/3/01	Lupron	$875 million	Marketing the spread and concealment of best price	HMO Physician and TAP sales executive
TOTAL			$7.79 Billion (and growing!

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