BOSTON (SHNS) – Cambridge-based Biogen has agreed to pay $900 million to resolve allegations stemming from a whistleblower lawsuit alleging the pharmaceutical company paid kickbacks to physicians to induce them to prescribe the company’s multiple sclerosis drugs.
The U.S. Attorney’s office said late Monday that the settlement resolves the suit filed by former Biogen employee Michael Bawduniak under provisions of the False Claims Act that permit a private party, known as a relator, to file suit on behalf of the United States and receive a portion of any recovery. Bawduniak will receive a share of the $843.8 million that Biogen will pay to the United States, prosecutors wrote in their press release late Monday without disclosing the share amount.
The settlement itself states that “the United States agrees that Relator shall be awarded a share of $250,000,000 of the Federal Settlement Amount paid by Biogen.” Biogen will also pay $56.2 million to 15 states. The suit alleged Biogen violated the False Claims Act by “causing the submission of false claims to Medicare and Medicaid by paying kickbacks to physicians to induce them to prescribe Biogen drugs.”
Bawduniak’s complaint alleged that from Jan. 1, 2009 through March 18, 2014, Biogen “held programs through which it offered and paid remuneration, including speaker honoraria, speaker training fees, consulting fees and meals, to health care professionals who spoke at or attended Biogen’s speaker programs, speaker training meetings or consultant programs to induce them to prescribe the drugs Avonex, Tysabri and Tecfidera in violation of the Anti-Kickback Statute.”
Calling the matter “an important example of the vital role that whistleblowers and their attorneys can play in protecting our nation’s public healthcare programs,” U.S. Attorney Rachael Rollins announced the settlement late Monday.
“Bawduniak doggedly pursued this matter on behalf of the United States for over seven years,” Principal Deputy Assistant Attorney General Brian Boynton, head of the Department of Justice’s Civil Division, said in a statement. “The settlement announced today underscores the critical role that whistleblowers and their attorneys play in utilizing the False Claims Act to combat fraud affecting federal healthcare programs.” Prosecutors noted Monday that “claims resolved by the settlement are allegations only and there has been no determination of liability.”