After kickbacks to pharmacies, Novartis now sued for bribing US docs

Swiss drug giant Novartis AG has once been sued once again by the US government, this time for allegedly paying kickbacks to doctors to increase sales of its prescription hypertension and diabetes drugs.

The new lawsuit this week, which seeks triple damages and civil penalties, comes just a few days after the US government slapped a civil health care fraud lawsuit against the Basel-based company for allegedly paying kickbacks to at least 20 pharmacies to switch kidney transplant patients from generic drugs to its own branded immunosuppressant drug Myfortic. (See: US government sues Novartis for paying kickbacks to pharmacies)

Preet Bharara, US Attorney for the southern district of New York, who earlier last year convicted former McKinsey boss Rajat Gupta, said that the Basel-based company gave physicians expensive dinners, speaker fees, fishing trips and outings at Hooters restaurants to get them to increase prescriptions of the company's two prescription hypertension drugs Lotrel and Valturna, and diabetes drug Starlix.

As a result of this, Medicare, Medicaid, and another federal healthcare programmes were forced to pay millions of dollars for kickback-tainted claims, the US has alleged in its lawsuit filed yesterday in Manhattan federal court.

The US government intervened in part in a lawsuit filed by a whistleblower in early 2011, under the qui tam provisions of the False Claims Act.

Bharara said, ''As alleged, Novartis corrupted the prescription drug dispensing process with multi-million dollar 'incentive programs' that targeted doctors who, in exchange for illegal kickbacks, steered patients toward its drugs. And for its investment, Novartis reaped dramatically increased profits on these drugs, and Medicare, Medicaid, and other federal healthcare programs were left holding the bag, doling out millions of dollars in kickback-tainted claims.''

''Healthcare fraud imposes tremendous costs and causes great harm to an already burdened healthcare system, and the government will not tolerate it. The widespread kickback fraud alleged in our two lawsuits against Novartis – which only a few years ago settled a False Claims Act case involving violations of the Anti-Kickback Statute based on illegal payments to doctors – makes us question whether Novartis is getting the message,'' he added.

Bharara, who has called Novartis a ''repeat offender'', was referring to the company's September 2010 settlement, where it agreed to pay $422.5 million to settle criminal and civil liability for illegally promoting drugs for off-label uses.