Pharmaceutical Company Settles for $30 million in Lawsuit Alleging Doctor Kickbacks

Whistleblowers included Michael Wilson, Lucius Allen, a former LA Lakers Basketball player and his wife, Eve Allen. The whistleblowing trio was represented by the law firm of Waters Kraus & Paul in Los Angeles.

Although Bristol-Myers Squibb did not admit wrongdoing in the lawsuit they did settle in the case alleging drug marketing fraud and physician kickbacks. “Patients have a right to expect medications prescribed for them are based solely on medical need and not because the physician was given tickets to a sporting event or treated to a lavish golf outing,” said Insurance Commissioner Dave Jones. “Illegal and unethical marketing practices put patient health at risk if a medical professional is influenced by the inducements offered by drug makers.”

The California Department of Insurance officials said that Bristol-Myers Squibb, as part of the alleged scene to gain customers offered physicians and their families gifts and cash to increase prescriptions of Bristol-Myers Squibb products. This is illegal as part of the California Insurance Frauds Prevention Act due to the company employing sales representatives who were to use kickbacks to entice sales of the pharmaceutical products.

Included in the medications in which kickbacks were offered were: Plavix, Pravachol, Monopril, Abilify, Glucovance, Metaglip, Glucophage, Glucophage XR, Cefzil, BuSpar, Serzone, Tequin, Pravigard, and Avapro.

Kickbacks included box suites for sporting events which included tickets, food, drinks and parking. Physicians also were offered enrollment in Lakers basketball camp for both doctors and their children, pre-paid golf outings, Broadway plays, monetary incentives , lavish dinners, resort hotel trips, concert tickets and more. These were offered to doctors who were large-volume prescribers, “to induce more prescriptions in the future”, the CDI officials said.  Some incentives were simply given to doctors who were responsible for “prescription-drug decisions for formularies”.

The settlement agreement also requires the Bristol-Myers Squibb complies with all California laws regarding interactions with doctors, including compliance with pertinent provisions of the California Health and Safety Code and the California Insurance Frauds Prevention Act.

The $30 million settlement, as required by the State of California Whistleblower will be split between the whistleblowers and the state. The state will receive over $14 million which will be used enhance future insurance fraud investigations and prevention.

A Bristol-Myers Squibb representative released a statement on Tuesday:
We have resolved this matter with the California Department of Insurance, and are committed to the highest standards of business integrity, vigilance and ethics across our organization.  Bristol-Myers Squibb denies any wrongdoing in this matter and we are pleased to put this matter behind us so that we can focus on making transformational medicines for patients battling serious diseases. The Company has chosen this path to achieve a prompt and full resolution of the claims based on alleged marketing practices in California that purportedly occurred from 1997-2003, and to ensure that we continue to focus on our mission of discovering, developing, and delivering innovative medicines to patients with serious illnesses.

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