The U.S. Department of Justice announced that Shire Pharmaceuticals LLC (Shire) will pay $56.5 million to settle a pair of qui tam lawsuits. Whistleblower and former Shire executive, Dr. Gerardo Torres, filed the initial qui tam suit in U.S. District Court for the Eastern District of Pennsylvania, while former Shire sales representatives Anita Hsieh, Kara Harris, and Ian Clark, filed a separate suit in the Northern District of Illinois.
The suits alleged that Shire violated the False Claims Act by fabricating information regarding the efficacy of Adderall XR and other medications used to treat attention deficit hyperactivity disorder (ADHD). Shire purportedly committed similar misconduct while promoting their ulcerative colitis medications.
According to the settlement agreement, from January 2004 to December 2007, Shire marketed Adderall XR as “clinically superior” to other ADHD medications, claiming that Adderall XR users could be “normalized” and “indistinguishable from [their] non-ADHD peers.” However, these statements were unsupported by clinical data.
Further, Shire claimed that Adderall XR could prevent problems linked to ADHD, such as poor academic performance, loss of employment, criminal behavior, traffic accidents, and sexually transmitted disease. These reports also lacked scientific evidence, thus misleading both prescribing doctors and medical patients about the benefits of Adderall XR. Further allegations even suggest that Shire marketed Adderall XR as a treatment for conduct disorder – an indication of use that had not been FDA approved and was not covered by state Medicaid.
Along with Adderall XR, Shire inaccurately marketed the ADHD medications of Vyvanse and Daytrana. The company claimed that parents preferred Vyvanse over Adderall XR for treatment of their children, and that it had a lesser chance of “abuseability” than Adderall XR. Similarly, Daytrana, an ADHD medication in the form of an adhesive patch, was promoted as being less addictive than traditional pills. These claims allegedly lacked supporting clinical data.
What share of the $56.5 million settlement do the whistleblowers receive?
Qui tam is a legal term that describes a case brought under the False Claims Act by a private individual on behalf of the federal government. In exchange for bringing the issue to the eyes of the government, a whistleblower is entitled to receive a portion of any settlement from the case. Qui tam claims promote a critical public interest in reducing fraud against the government and against the American taxpayers.
Because the whistleblowers brought Shire’s alleged misconduct to the government’s attention by filing a qui tam lawsuit under the False Claims Act, they will share a reward of $5.9 million. Whistleblowers, whom are known as the “relators” under the False Claims Act, are entitled to between 15 and 30% of the government’s recovery. In this case, the $5.9 million whistleblower reward represents 16.2% of the $56.5 million settlement.
In the Shire case, the relators were all former company employees – an executive and three sales representatives. Whistleblowers are often internal employees because they have access to relevant documents during their normal course of business and understand the processes and structure of a business that may not be evident to an outsider. To an outsider, a company’s fraudulent billing to the government may not be obvious, but an internal employee may have the documents and knowledge to substantiate his or her whistleblowing claims.
Since January 2009, the Department of Justice has recovered more than $20.5 billion through False Claims Act cases, with more than $14.2 billion of that amount recovered in cases involving fraud against federal health care programs.
Our experienced whistleblower attorneys are monitoring the health care sector and are ready to fight for whistleblowers who have information about fraud committed against the government in the healthcare sector. If you have knowledge of a company submitting false bills to the government and have evidence to substantiate your claims, please contact The Cochran Firm, D.C. today to discuss your legal options. Our attorneys understand the importance of a qui tam recovery and design case strategies with the goal of securing whistleblowers the largest award possible.