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Novartis close to US bribery settlement

Company faces huge damages pay out

Novartis

Novartis and the US federal government are close to agreeing a deal to settle allegations that the company offered kickbacks to doctors in return for prescribing its medicines.

The source of the report is a letter accidentally filed in a court docket, according to a Bloomberg report, which says the two sides have made “substantial progress” in bringing the six-year-old dispute to a resolution.

As is typical in these cases there is a “monetary aspect” to the settlement that has been submitted to the Department of Justice for approval, says the newswire. The case had been due to come to court last month but has been indefinitely delayed.

The whistleblower case was first brought in 2013 and focuses on marketing activities by Novartis for its immunosuppressant product Myfortic (mycophenolate), antihypertensives Lotrel (amlodipine/benazepril) and Valturna (aliskiren/valsartan), and the diabetes treatment Starlix (nateglinide).

The DoJ has accused the company of providing inducements for prescriptions, including paying doctors for speaking engagements in barely credible locations, such as Hooters restaurants and on fishing trips off the Florida coast. One incident involved a $3,000 meal tab for two people, and in some cases the engagements were completely sham and never took place.

According to the latter, Novartis is negotiating a new “corporate integrity” agreement that will include a new compliance structure – headed by a senior executive – with monitoring by an independent third-party organisation.

A similar compliance deal was agreed in 2010, after Novartis paid $422m to settle allegations that it marketed the epilepsy drug Trileptal (oxcarbazepine) and five other drugs for unauthorised use in the US, but the DoJ has previously claimed the company did not fully comply with that agreement.

In 2015, Novartis paid $390m to settle claims related to allegations of kickbacks involving specialty pharmacy prescribing of Myfortic and thalassaemia treatment Exjade (deferasirox), without admitting any liability. The D0J had sought up to $3.35bn in fines and damages when it filed the case.

The story was broken by STAT News' Pharmalot blog, which reported that the US government has been seeking as much as $1bn in damages in the current dispute. This suggests another hefty pay-out could be on the way, with a deal expected to be finalised by 13 August.

Article by
Phil Taylor

13th June 2019

From: Regulatory

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