Federal government joins lawsuit against drug giant Novartis over bribery, kickback schemes

Wednesday, May 01, 2013 by: Ethan A. Huff, staff writer
Tags: Novartis, pharmaceutical industry, bribery

(NaturalNews) A lawsuit originally filed by a former employee-turned-whistleblower of pharmaceutical giant Novartis is gaining new momentum following the announcement that the federal government has now joined on as a plaintiff. According to the suit, Novartis has committed numerous crimes over the years, including alleged violations of the federal anti-kickback statute, by illegally paying off doctors with fancy dinners, vacation trips, cash, and other lavish perks to prescribe Novartis-branded drugs to patients.

The civil suit is an extension of an earlier lawsuit filed back in 2010 by former Novartis executive Oswald Bilotta, and it is merely the latest in a string of suits filed against the New Jersey-based company over the past decade. According to reports, Novartis has paid out tens of millions of dollars over at least the past ten years to have doctors promote its drugs at "educational" seminars. The company also allegedly paid off pharmacists to switch patients' drugs from less-expensive competitor drugs to Novartis-branded drugs.

"Novartis corrupted the prescription drug dispensing process with multimillion-dollar 'incentive programs' that targeted doctors who, in exchange for illegal kickbacks, steered patients toward its drugs," said U.S. attorney Preet Bharara in a recent statement. "For its investment, Novartis reaped dramatically increased profits on these drugs, and Medicare, Medicaid, and other federal healthcare programs were left holding the bag."

Novartis roped in doctors for its drug marketing scam by treating them to fancy meals

According to Reuters, Novartis had carefully created an extensive scheme of kickback programs that purposely cozied up to doctors and basically turned them into drug-dispensing salesmen for Novartis. The lawsuit itself describes doctors being taken out to Hooters restaurants, for instance, as well as to other pricier restaurants such as Chicago's Japonais and L20 as incentives. In one documented case back in 2005, Novartis took three doctors to the lavish Nobu restaurant in Dallas, where they were treated to $10,000 worth of fine food and spirits.

"We believe that Novartis' alleged payment of kickbacks is yet another example of abuse in the pharmaceutical industry that contributes to skyrocketing medical costs," says James Miller, a partner at Shepherd, Finkelman, Miller, and Shah in Chester, Connecticut. Miller is representing Bilotta, the original plaintiff in the case.

Even though Novartis has already paid out hundreds of millions of dollars throughout the past few years for prior criminal and civil liability cases involving illegal drug marketing, the company is attempting to maintain its alleged innocence in this case. A Novartis spokeswoman is actually quoted as saying that the company's "promotional programs" are somehow educational, and that they are supposedly "conducted in an ethical and responsible manner."

Sources for this article include:

http://www.reuters.com

http://www.cnbc.com/id/100683190

http://abcnews.go.com