Posted by Hae-Won Min Liao and Elizabeth McEachron
On April 16, 2013, the Department of Justice announced that Amgen Inc. (“Amgen”) had entered into a settlement with federal and state agencies to resolve allegations in a qui tam action involving its biologic product Aranesp, an anemia medication. The civil settlement requires Amgen to pay $24.9 million for conduct from September 1, 2003 through December 31, 2012.
The complaint against Amgen had been filed by a former company employee in the U.S. District Court for the District of South Carolina and the government had intervened in the litigation. The government alleged that Amgen made available and paid to long-term care pharmacy providers Omnicare, Inc., PharMerica Corporation, and Kindred Healthcare Inc. (collectively, the “LTC providers”) market-share and volume-based rebates, as well as grants, honoraria, speaker fees, consulting services, dinners, travel and purchase of unnecessary data, all related to Aranesp, and that these payments amounted to “kickbacks” under the False Claims Act. The government also asserted that Amgen’s therapeutic interchange programs improperly encouraged the “switching” of patients using competitor drugs to Aranesp. Noting the alleged efforts by Amgen to expand its market, the government alleged that Amgen pressured the consultant pharmacists employed by the LTC providers to recommend Aranesp to patients who had not been previously diagnosed or had a medical history with anemia associated with chronic renal failure and exhibited no outward signs of anemia associated with chronic renal failure. Amgen allegedly promoted the use of protocols, distributing materials and sponsoring programs designed to promote the use of the product outside the approved labeling for Aranesp.
The matter was settled to compromise disputed claims and with the express acknowledgement that Amgen was not admitting liability and the government was not admitting that its claims were not well-founded.