Cashing in on dementia patients: drugmaker to pay $116 million in fraud settlement
A pharmaceutical company that whistleblowers alleged paid doctors to prescribe its main drug and urged salespeople to push it as a way to control unruly dementia patients will pay more than $100 million to settle government fraud allegations.
The Department of Justice announced the settlement with Avanir Pharmaceuticals on Thursday, four years after these whistleblowers alerted the federal government that they believed the company was paying kickbacks to doctors and illegally marketing its main drug, Nuedexta -- particularly in nursing homes. Each of these three whistleblowers will receive a portion of the millions Avanir has agreed to pay.
In addition to the settlement with Avanir, Justice Department officials announced they had indicted two doctors and two of the drugmaker's salespeople for their alleged involvement in a "kickback conspiracy."
The allegations resulting in Thursday's $116 million settlement -- which includes both civil damages and criminal penalties to federal and state governments -- mirrored those exposed by a 2017 CNN investigation into inappropriate and potentially fraudulent use of Nuedexta in nursing homes. Avanir said the company is "deeply committed to regulatory and legal compliance, integrity and ethical behavior" and that it had cooperated with the government investigation and "engaged in extensive remedial measures," which the government said included terminating or otherwise removing multiple employees.
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