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Mallinckrodt to pay over $15 million after illegal kickbacks to doctors allegations

Christian Fernsby ▼ | September 5, 2019
Pharmaceutical company Mallinckrodt ARD LLC (formerly known as Mallinckrodt ARD Inc. and previously Questcor Pharmaceuticals), has agreed to pay $15.4 million.
America   Questcor paid illegal kickbacks to doctors
They will pay to resolve claims that Questcor paid illegal kickbacks to doctors, in the form of lavish dinners and entertainment, to induce prescriptions of the company’s drug, H.P. Acthar Gel (Acthar) from 2009 through 2013.

Topics: Mallinckrodt doctors illegal

The Federal Anti-Kickback Statute prohibits a pharmaceutical company from offering or paying, directly or indirectly, any remuneration which includes money or any other thing of value with the intent to induce a health care provider to prescribe a drug reimbursed by a federal health care program, including Medicare.

This prohibition extends to such practices as “wining and dining” doctors to induce them to write Medicare prescriptions of a company’s products.

The government alleged that, from 2009 to 2013, twelve Questcor sales representatives marketing Acthar provided illegal remuneration to health care providers in the form of lavish meals and entertainment expenses.

The company paid this remuneration, the government alleges, with the intent to induce Acthar Medicare referrals from those health care providers, resulting in a violation of the Anti-Kickback Statute and the submission of false claims to Medicare.

The allegations that are the subject of the settlement were originally alleged in two cases filed under the whistleblower, or qui tam, provision of the False Claims Act.

The act permits private parties to sue for fraud on behalf of the United States and to share in any recovery.

The act also permits the government to intervene in such actions, as the government previously did in the two whistleblower cases.

The whistleblowers will receive approximately $2.926 million of the settlement.

The government is continuing to pursue claims in these two matters alleging that Mallinckrodt violated the False Claims Act by using a foundation as a conduit to pay illegal kickbacks in the form of copay subsidies for Acthar.

These claims are not being resolved by the settlement.