Court Grants Summary Judgment in Kickback-Based FCA Case, Holding Relator Failed to Prove Remuneration or Willfulness
The District of Massachusetts recently granted summary judgment to Janssen Biotech, Inc. (“Janssen”) in a declined False Claims Act qui tam. The relator alleged that Janssen gave physician practices free services to induce them to prescribe its infusible drugs, Remicade and Simponi ARIA. U.S. ex rel. Long v. Janssen Biotech, Inc., No. 16-12182-FDS (D. Mass. Sept. 30, 2026). The court held that the relator’s Anti-Kickback Statute (“AKS”) theory failed because she offered insufficient evidence that: (1) the services were “remuneration” and (2) Janssen acted “knowingly and willfully.”
The case arose from Janssen’s “site of care” programming. Through that program, Janssen’s Area Business Specialists (“ABSs”) met with practices that infused, or wanted to infuse, Remicade and Simponi ARIA in their offices. Using slide decks and other materials approved by an internal review committee, ABSs gave presentations on topics such as setting up an infusion suite, billing and coding, and scheduling. The relator, a former ABS, alleged that these services were unlawful kickbacks in the form of free business consulting.
The court began by noting two features of the case that undermined the relator’s claims. First, unlike the typical qui tam relator, she did not participate in any allegedly unlawful activity and apparently did not witness any. Second, she conceded that Janssen’s approved written materials were lawful. She argued instead that ABSs went beyond those materials in live meetings with practices. Yet the record contained no direct evidence of what was said in those meetings. The relator submitted no affidavit, and no other ABS, physician, or practice staff member testified. As the court put it, there was “a large evidentiary hole at the heart of this case.”
AKS Remuneration. The court explained that nearly any service a manufacturer provides has some value. For that reason, in cases like this, courts have looked to HHS-OIG guidance, which asks whether a service has “substantial independent value,” meaning value to the practice apart from the product. Support tied to the product, such as billing help for that drug, generally does not qualify as remuneration. The court applied this framework but emphasized that, post-Loper Bright, interpreting the AKS is the court’s role.
The court found no real question that Janssen’s services had value. The issue was whether that value was independent of Remicade and Simponi ARIA. According to the court, the relator came closest to establishing a violation with the Infusion Optimization Modeler (“IOM”). That tool used a practice’s staffing, chair, and patient data to estimate how many more Remicade infusions the practice could schedule. But the court noted that the IOM was used only with practices already infusing Janssen’s drugs. It concluded that “if Remicade and Simponi ARIA did not exist, the IOM would have no value,” so the IOM did not have independent value and did not constitute remuneration.
Scienter. The court further held that, even if the services were remuneration, the relator had not shown the required intent. She had not shown that any employee intended to violate the law or that Janssen was “flagrantly indifferent” to its legal obligations. The court concluded that edits compliance officers made to training materials did not show concealment and that internal communications flagging compliance risks showed only that Janssen had “compliance officers who did their jobs.” The court warned that treating such communications as proof of intent would effectively penalize companies for having a compliance function.
The decision sets important precedent on both points for life sciences companies in FCA actions premised on alleged AKS violations.
A copy of the decision can be found here.
This post is as of the posting date stated above. Sidley Austin LLP assumes no duty to update this post or post about any subsequent developments having a bearing on this post.
