Novartis charged with paying "kickbacks" to US doctors

The US Department of Justice announced last Friday (April 26) that the government has filed a second civil false claims law suit against Swiss drug major Novartis’ (NOVN: VX) US subsidiary, involving alleged “kickbacks” paid by the company to health care providers.

The government’s complaint seeks damages and civil penalties under the False Claims Act and under the common law for paying kickbacks to doctors to induce them to prescribe Novartis’ pharmaceutical products that were reimbursed by federal health care programs. The law suit alleges that the payments violated the Anti-Kickback Statute and, as a result of Novartis’s unlawful conduct, the government paid false claims for reimbursement for the company’s pharmaceutical products. Novartis allegedly violated the Anti-Kickback Statute to increase sales of its hypertension drugs Lotrel (amlodipine and benazepril), Valturna (aliskiren and valsartan) as well as its diabetes drug Starlix (nateglinide).

“Kickback schemes like those alleged in this case not only call into question the integrity of individual medical decisions, but they also raise the cost of health care for all of us,” said Stuart Delery, Acting Assistant Attorney General for the Civil Division, adding: “Patients deserve care based on a doctor’s sound medical judgment, not the doctor’s personal financial interest. The Department of Justice will continue to pursue companies that use improper incentives, like those alleged here, to promote their products.”