Drug maker Amgen to pay $762 million to resolve whistleblower and government claims for illegally marketing drugs

by Michael Heygood

Biotechnology giant Amgen, Inc. has pled guilty to illegally marketing its drugs, including the anemia drug Aranesp. The drug maker has agreed to pay $150 million in criminal fines and penalties and $612 million in civil settlements. The large settlement of numerous criminal and civil claims against the drug maker includes an undisclosed amount to settle at least one whistleblower lawsuit brought against the company by a former employee.

The drug Aranesp is used to treat anemia caused by kidney disease or by cancer chemotherapy. The drug was once Amgen’s biggest seller and sales reached $4.1 billion in 2006. Sales have declined steadily amid increased scrutiny regarding its costs to Medicare as well as concerns that the drug can cause heart attacks and make cancer worse.

Kassie Westmoreland worked for Amgen from 2002 to 2005. She filed a “qui tam” lawsuit against Amagen alleging the company gave “liquid kickbacks” to doctors, as well as other incentives, to promote the drug Aranesp. Her suit alleged that Amgen overfilled vials of Aranesp as a way of providing doctors with free medicine. The doctors could profit by billing Medicare and insurance companies for the extra amount of medicine provided to them. The suit said that the free medicine was intended to induce doctors to buy Aranesp instead of Procrit, a competing anemia drug from Johnson & Johnson.

According to the Justice Department charges, Amgen promoted Aranesp at higher doses and at intervals the FDA had not approved. A complaint filed recently by the US Attorney’s Office in the Eastern District of New York alleged that Amgen sales representatives promoted Aranesp for an “off-label use”: a larger once monthly dose, rather smaller doses twice a month. Aranesp is administered intravenously or by injection and patients often find it painful. As a result, changing from twice a month to once a month would make it more desirable. Although a doctor can legally prescribe a medication for off-label uses, pharmaceutical and biotech companies are not allowed to promote off-label usage to doctors.

Westmoreland will likely receive a part of the Amgen settlement under federal law for whistleblowers who bring suits under the False Claims Act.

Anyone who has information that a business or person has knowingly submitted or caused the submission of false or fraudulent claims to any branch of the United States government can potentially help file and pursue a lawsuit under the False Claims Act. The “whistleblower” (called a “relator”) does not have to have been personally harmed at all. The relator just needs to be aware of the false or fraudulent conduct.

A False Claims Act lawsuit seeks to recover money for the government from the business or person who submitted false or fraudulent claims. If money is recovered—whether from a settlement between the parties or a court judgment—the whisteblower/relator who helped initiate the lawsuit can potentially recover 15 to 30% of the total amount recovered. The whistleblower/relator is rewarded to compensate them and their attorney for the hard work involved in pursuing such lawsuits and also to encourage others to come forward with information about false or fraudulent conduct.

The government has recovered billions as a result of False Claims Act lawsuits, and hundreds of millions have been paid to the private citizens–the relators/whistleblowers—who made the lawsuits possible.

If you have questions about how to pursue a claim under the False Claims Act, please let us know. You can reach us by calling our toll-free hotline at 1-877-446-9001, or by filling out our free legal consultation form on this page.

by Michael Heygood

Michael Heygood is a licensed attorney and partner at HO&P who focuses on insurance and corporate litigation, and other civil arenas. Michael has been named multiple times to the Super Lawyers List.