A.G. Schneiderman Secures $2.5 Million From Major Pharmaceutical Company In Kickback Case

EMD Serono Alleged to Have Paid Doctors to Prescribe Patients the Multiple Sclerosis Drug Rebif

$44.3 Million Agreement Resolves Multi-State Whistleblower Investigation

Schneiderman: Those Who Compromise the Integrity of the Markets at the Expense of Taxpayers Will Be Forced to Pay

 

NEW YORK – Attorney General Eric T. Schneiderman today announced that his office has secured $2.5 million for New York State in an agreement with the pharmaceutical manufacturer EMD Serono, Inc., to settle allegations the company caused false or fraudulent claims to be submitted to the Medicaid program. The multi-state settlement agreement totals $44.3 million, and stems from an investigation into whether the company paid doctors, in part, so that they would prescribe the multiple sclerosis drug Rebif to patients. 

“Those who compromise the integrity of the markets for profit at the expense of taxpayers will be forced to pay,” said Attorney General Schneiderman. “Taxpayers and, in this case, patients, must have absolute confidence that they are receiving health care on the merits and that taxpayers are getting the best deal possible. This leaves no room for manipulation, and my office will have zero tolerance for it.”

Rebif is an interferon beta-1a drug injected subcutaneously to treat relapsing forms of multiple sclerosis (MS), a chronic autoimmune disease that attacks the central nervous system, in order to reduce the number of flare-ups and slow down the development of physical disability associated with MS.   

During the period of March 2002 through December 2009, EMD Serono offered and paid remuneration to health care professionals for activities such as promotional speaking engagements, attending speaker training, advisory and consultant meetings, educational grants, and charitable contributions. In this case, New York State alleged that at least one purpose of these payments was to induce those professionals to prescribe Rebif.

The investigation was initiated by a lawsuit filed under the qui tam provisions of the Federal False Claims Act.  This action is pending in the United States District Court for the District of Maryland.

A team representing the National Association of Medicaid Fraud Control Units participated in the investigation and conducted settlement negotiations with EMD Serono on behalf of the states. In addition to representatives from New York State, team members included representatives from South Carolina, North Carolina, and Texas.

Under the agreement, EMD Serono agreed to pay the participating states and the United States $44.3 million, plus interest.   The Medicaid programs nationwide will receive approximately $19 million of the total settlement.  New York will receive almost $2.5 million in state and federal funds.  Medicaid is funded jointly by the federal and state governments.

New York was represented by Jay Speers, Director of the Special Projects Unit of the Attorney General’s Medicaid Fraud Control Unit and Michael LaCasse, Chief Auditor of the Special Projects Unit under the supervision of Monica Hickey-Martin, Special Deputy Attorney General.

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