Healthcare and Pharma Cases


Medicare Fraud Whistleblowers Will Receive $1.20 Million as Life Spine Pays $6 Million to Resolve Kickback Allegations

Medicare Fraud Whistleblowers Will Receive $1.20 Million as Life Spine Pays $6 Million to Resolve Kickback Allegations

Illinois-based Life Spine, its CEO, and its VP will pay about $6 million to resolve illegal kickback allegations involving the company’s medical devices. According to the False Claims Act lawsuit that was recently settled, the defendants paid surgeons to recommend and promote Life Spine’s implants and other products.

The company has agreed to pay $5.5 million and the two executives will complete the payout; CEO Michael Butler will pay $375,000 and Vice President Richard Greiber $115,000. The settlement agreement was announced before a New York federal judge on October 23rd.

The alleged misconduct was brought to light in a whistleblower lawsuit filed in 2018 by four former Life Spine employees. The U.S. government decided to intervene last July.

According to the DOJ, the whistleblowers will receive 20 percent of the settlement payments. Based on that percentage, the tipsters are set to share a $1.20 million award....


Avanir Pharmaceuticals Will Pay Over $108 Million to Resolve Illegal Kickback Allegations Involving Its Drug Nuedexta, Three Whistleblowers Will Share $17 Million Award

Avanir Pharmaceuticals Will Pay Over $108 Million to Resolve Illegal Kickback Allegations Involving Its Drug Nuedexta, Three Whistleblowers Will Share $17 Million Award

Back in 2017, CNN published an investigation entitled, “The little red pill being pushed on the elderly.” The red pill was Nuedexta, which is used to treat a rare condition: pseudobulbar affect, also known as PBA. Now, its maker, Avanir Pharmaceuticals, has agreed to pay $108 million to resolve allegations that it offered illegal kickbacks to physicians to boost sales of the drug. 

Two False Claims Act complaints initiated the case against Avanir. The whistleblowers behind them will share a reward surpassing $17 million.

According to prosecutors, the doctors bribed by Avanir routinely prescribed the drug to people who didn’t need it. Medicare and other government healthcare programs were then billed for these prescriptions. Drugs.com estimates the price of Nuedexta at approximately $1,235 for a supply of 60 capsules....


Mallinckrodt Pharmaceuticals Agrees to $15 Million Settlement to Resolve Kickback Allegations

Mallinckrodt Pharmaceuticals Agrees to $15 Million Settlement to Resolve Kickback Allegations

Mallinckrodt Pharmaceuticals will pay $15.4 million to resolve allegations that it illegally marketed one of its most profitable drugs. Mallinckrodt became involved in the lawsuit after it acquired the drug’s original maker, Questcor, for $5.6 billion, in 2014.

Last May, we reported on the two (now consolidated) whistleblower lawsuits that were resolved by the recent settlement. The False Claims Act case was initiated by Charles Strunck, a former Questcor sales specialist, and Lisa Pratta, a former Questcor neurology specialist. Both Strunck and Pratta were involved in the marketing of Acthar, a drug used in multiple sclerosis treatments.  

H.P. Acthar Gel, which is also used to treat lupus, arthritis, and seizures in infants, experienced a spectacular price increase in 2007, going from $1,600 to $23,000. In under 20 years, the drug’s price went from $40 to $39,000 per vial. Its annual sales currently surpass $1 billion....


Bay Area Home Healthcare Provider Amity Faces $115 Million Kickback Scheme Allegations, 30 Defendants Charged, Including CEO

Bay Area Home Healthcare Provider Amity Faces $115 Million Kickback Scheme Allegations, 30 Defendants Charged, Including CEO

The CEO of Amity Home Health Care, Ridhima Singh, 13 doctors, five nurses, a social worker, and 10 others have been charged with participating in a massive kickback scheme created by Singh. According to prosecutors, the CEO paid about $115 million in bribes to the other defendants in exchange for referrals of Medicare beneficiaries.

Allegedly, the defendants systematically referred patients for hospice care to both Amity and Advent Care Inc., instead of referring them to appropriate facilities based on their particular situation. In some cases, Medicare beneficiaries were referred to hospice in exchange for kickbacks that included a ‘longevity’ bonus (as long as the patient was alive, the referring doctor would benefit financially). 

According to its website, Amity “is a home health agency that is committed to providing the best quality of skilled care to [their] patients in the comforts of their own home.” ...


Government Joins Seven Whistleblowers in $50 Million Lawsuit Against Sen. Steve Dickerson and CPS Pain Clinics Over Fraudulent Urine Test Billings

Government Joins Seven Whistleblowers in $50 Million Lawsuit Against Sen. Steve Dickerson and CPS Pain Clinics Over Fraudulent Urine Test Billings

In November 2017 a Bloomberg headline ironically advised, “Want to turn that pain clinic into a real moneymaker? Open your own urine-testing lab and start billing Medicare.”  

Back in July of 2016, when neither the public nor the authorities were aware that certain pain clinics executives were referring to these pricey urine tests as “liquid gold,” the CEO of Tennessee’s Comprehensive Pain Specialists (“CPS”) said in a press release, “Since January, CPS has seen a 19% increase in referrals from Primary Care Physicians. . . . By taking a seat on a patient’s care team, CPS is able to work with their physicians to address both the cause and the treatment of their pain. Putting patients on long term pain medication certainly isn’t the goal.” 

While the press release included ‘politically correct’ statements about “treating the epidemic of chronic pain without escalating the epidemic of opioid misuse,” it didn’t shy away from boasting of the potential for large profits resulting from the passing of the Comprehensive Addiction and Recovery Act (“CARA”).

Prosecutors now believe CPS, which operated its own lab, did exactly what Bloomberg advertised, and with the help of a senator....


Beaver Medical Group and One of Its Doctors Will Pay $5 Million to Resolve Medicare Advantage Fraud Allegations

Beaver Medical Group and One of Its Doctors Will Pay $5 Million to Resolve Medicare Advantage Fraud Allegations

California-based Beaver Medical Group and Dr. Sherif Khalil have agreed to pay $5 million to settle allegations that they conspired to defraud Medicare by providing false information about individuals participating in the Medicare Advantage program.  

Medicare Advantage Organizations (“MAOs”) provide comprehensive health care services to individuals enrolled in Medicare Advantage. Medicare pays them a fixed amount per individual, depending on the state of the beneficiaries’ health. The sicker the Medicare beneficiaries, the higher the payments. If they provide false diagnoses to Medicare, healthcare providers can illegally boost their profits.  

Beaver was under contract with numerous MAOs in California. According to the allegations, the company falsified diagnoses to boost the MAOs’ Medicare billings. The MAOs would then share some of those profits with Beaver, thus creating an illegal financial incentive, the DOJ said. Dr. Khalil was allegedly part of the scheme, as some of the false diagnosis records bore his signature. After analyzing the evidence, the DOJ found that there were no patient records or tests results to substantiate many of the diagnoses submitted by the MAOs....


Eagleville Hospital Will Pay $2.85 Million to Resolve Allegations of Medicare and Pennsylvania Medicaid Fraud Involving Fraudulent Billing

Eagleville Hospital, a provider of substance abuse treatments to beneficiaries of Medicare and Medicaid, has reached a $2.85 million settlement with the government to resolve allegations that it defrauded various federal health care programs. According to a False Claims Act lawsuit filed by a whistleblower, the hospital billed Medicaid, Medicare, and the Federal Employees Health Benefits Program for detoxification treatments for ineligible patients.   

The anonymous whistleblower has been awarded $500,000 for his key role in the recovery of millions of taxpayer dollars. Under the False Claims Act, individuals with information about fraud can file a complaint while protected by anti-retaliation provisions, receiving between 15 and 30 percent of any resulting recoveries. 

According to the complaint that originated the settlement, Eagleville Hospital systematically admitted various categories of patients to secure the highest reimbursement class of detoxification treatments, when there was no medical necessity for it. As a consequence, the hospital submitted false claims to the government in its billing for these services. The alleged misconduct took place between January 2011 and December 2018....


Inpatient Rehabilitation Facility Network Encompass Pays $48 Million to Resolve Medicare Fraud Allegations

Alabama-based Encompass Health Corporation (now HealthSouth Corp.) has agreed to pay $48 million to settle Medicare fraud allegations. According to prosecutors, Encompass’s Inpatient Rehabilitation Facilities (IRFs) falsified "disuse myopathy" diagnostics in order to maintain their standing as high-reimbursement Medicare-approved IRFs.  

The alleged fraud was brought forward in three separate whistleblower lawsuits, later joined by the Department of Justice. According to the allegations, Encompass IRFs systematically admitted patients who were “too sick or disabled to participate in or benefit from intensive inpatient therapy." 

According to U.S. Attorney Maria Chapa Lopez (Florida, Middle District), "This important civil settlement concludes a lengthy, comprehensive investigation that brought to light a nationwide scheme that the government contends was intended to defraud our fragile public health...


SEC Whistleblower from Brazil Gets $4.5 Million Award After Reporting Misconduct by Zimmer Biomet

SEC Whistleblower from Brazil Gets $4.5 Million Award After Reporting Misconduct by Zimmer Biomet

A whistleblower in Brazil has just received a $4.5 million award for his role in uncovering a kickback scheme allegedly run by a subsidiary of Zimmer Biomet Holdings Inc. (Zimmer Biomet), a medical device manufacturer. The tipster is a former orthopedic surgeon who became aware of the alleged misconduct while practicing medicine in his home country.

Based in Indiana, Biomet markets its orthopedic and dental implant devices on a global scale. The whistleblower, on the other hand, is a prominent surgeon in South America and former president of Brazil’s Orthopedic Sports Medicine Society. As it is customary with SEC whistleblowers, his name has not been made public.

In 2013, the whistleblower reported the alleged misconduct anonymously to Biomet executives. Within 120 days, he reported it to the SEC. According to his reports, the company was still running a kickback scheme in Brazil, in spite of having faced SEC penalties in the past for the same type of misconduct....


Game Over for Monsanto: $2 Billion Verdict to Give Way to Massive Wave of Settlements, Top Roundup Litigator Says

Game Over for Monsanto: $2 Billion Verdict to Give Way to Massive Wave of Settlements, Top Roundup Litigator Says

The recent $2 billion jury verdict against Monsanto may be a clear indication that Bayer will likely settle the remaining 13,000 cases claiming the active ingredient in Roundup, glyphosate, causes aggressive blood and bone cancer.

Attorney Brian Mahany is convinced that numerous settlements will follow and has good evidence to back up his claim. An active participant in the recent spate of Roundup cancer lawsuits, he is well placed to interpret the verdict.

Global Monsanto/Bayer Settlement in The Works

According to Mahany, the court quietly postponed the bellwether trial scheduled to begin on May 20th. Instead, the court noted an upcoming “confidential mediation.”...