Amgen Inc. agreed to pay $612 million to resolve civil healthcare fraud allegations that the company unlawfully promoted its anemia drug Aranesp and other medications, and that it paid illegal kickbacks to physicians to induce them to prescribe the company’s products. In addition, the company agreed to pay a $150 million criminal fine and to plead guilty to a misdemeanor charge of introducing misbranded drugs into interstate commerce. Amgen’s business practices were fully exposed by eleven whistleblower cases, which were brought under the qui tam, or whistleblower, provisions of the False Claims Act. For courageously stepping forward, the whistleblowers will receive a multi-million dollar relators’ share award of at least $88 million.

While a physician may prescribe a drug for a use other than one for which it is approved, the federal Food, Drug and Cosmetic Act prohibits a drug manufacturer from marketing or promoting a drug for non-approved uses. The Food & Drug Administration (FDA) only approved Aranesp at a specific calibrated dose and for very specific uses, such as treatment of anemia for particular patient populations. Amgen, however, allegedly marketed the drug broadly to physicians for off-label uses and at dosages that the FDA had specifically considered and rejected. The whistleblowers alleged that these illegal promotions propped up a substantial off-label market for the company’s product.

Of particular note, Amgen allegedly trained its sales representatives to promote off-label uses through the guise of reactive marketing. For instance, Amgen allegedly trained the sales reps to intentionally elicit questions from prescribers about off-label uses as legal cover to then provide physicians with studies supporting the off-label use. Those studies “were often the very same studies that the FDA had rejected as insufficient to support the safety and efficacy of those off-label uses,” according to the criminal information. This intended “smokescreen” was meant to circumvent the law by inducing physicians to ask questions about an off-label use.

In addition, the whistleblowers alleged that Amgen misused journal articles and improperly obtained listings in medical compendia to establish that the off-label uses were medically accepted and thereby eligible for coverage by federal healthcare programs.

The whistleblowers also provided the government with detailed allegations of widespread kickbacks and illegal inducements. They alleged that Amgen had various programs and initiatives utilized by its sales force to induce physicians to prescribe Aranesp, regardless of whether the uses were covered by federal healthcare programs or were medically necessary.

Federal and State False Claims Acts allow private citizens with detailed knowledge of fraud to bring an action on behalf of the governments and to assist in the recovery of the governments’ stolen dollars. These statutes allow the government to recover three times the amount it was defrauded, in addition to civil penalties of $5,500 to $11,000 per false claim. Successful whistleblowers can receive between 15 and 30 percent of the governments’ recovery.

Amgen paid the federal government $150 million to settle the criminal allegations and $587.2 million to settle the civil allegations. The participating States will receive $24.8 million, as a result of a Medicaid State settlement. The whistleblowers will collectively receive a yet-to-be-announced settlement of at least $88 million.

More information for whistleblowers is located at the Nolan Auerbach website.