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Qui Tam Whistleblower Update: Exposing Fraud Under False Claims Act Can Lead to Huge Payoff

above-the-bar-logo-no12.jpgThe U.S. government has reached a tentative settlement with Abbott Laboratories for at least $1.3 billion for allegations that Abbott had marketed its epilepsy drug, Depakote illegally. This would be the third largest illegal pharmaceutical marketing settlement ever. To date, Pzifer has paid the biggest settlement amounting to $2.3 billion in 2009 for illegally marketing its painkiller Bextra and other drugs.

The lawsuit against Abbott was brought to light by whistleblowers who alleged that Abbot was marketing Depakote for agitation and aggression in patients with dementia, autism, sexual compulsion and other disorders not approved by the U.S. Food and Drug Administration (“FDA”). Depakote is only FDA approved to treat epilepsy, bipolar mania and migraine prevention. According to federal regulations, a physician can only prescribe medication that has been licensed and found to safe and effective by the FDA. Federal law makes it illegal to market a drug for uses other than those approved by the FDA. In other words, a pharmaceutical company cannot market an epilepsy drug as a cure for heart disease. If you know of any fraudulent activity being committed against the government at your workplace, our attorneys can help you determine if you have a qui tam whistleblower lawsuit under the False Claims Act. Our attorneys have helped many clients evaluate their evidence to determine if they have a strong claim.

Meredith McCoyd (“McCoyd”), a former Abbott sales representative, filed the lawsuit in 2007 under the False Claims Act. She filed suit on behalf of the federal government, 24 states and the District of Columbia. Shortly after, the government and the states joined her suit. Her lawsuit was consolidated with three other suits also alleging off-label marketing.

McCoyd alleged in her whistleblower complaint that Abbot was marketing Depakote to elderly patients with Alzheimer’s and dementia in 1998 although Abbott knew that it “was unapproved for the treatment of Alzheimer’s, did not work to treat the disease and was actually dangerous for use by the elderly.” The drug was especially pushed in healthcare settings such assisted living facilities and long term care facilities throughout the U.S. Her complaint also alleged that Depakote sales “rocketed to over $1.4 billion per year” and “compensation for senior executives soared as well” because of the illegal marketing.

The whistleblower statute plays a crucial role in helping the government to stop illegal activity which it may otherwise never have known of. This is extremely important when pharmaceutical companies who are endangering the public’s health are involved in the fraud. It is atrocious that Abbott executives were financially benefiting at the expense of the public’s health.

Because both the federal government and the states are involved, this would be a global settlement. Pursuant to the False Claims Act, the whistleblowers would get at least 15% of the federal civil amount recovered in the settlement as well as some of the money paid to the states. Under the qui tam provision of the False Claims Act, you may bring an action on behalf of the government if you have evidence of fraud being committed against the government. Depending on whether or not the government takes over your lawsuit, you may be entitled to 15% to 30% of the recovery. Because it’s a complicated statute with strict requirements, it is best to consult an attorney if you have information about fraud being committed against the government. Call our qui tam Whistleblower Attorneys at Villanueva & Sanchala at (800) 893-9645 to help you decide if you have a case under the False Claims Act.


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