Parsippany-Based Pharmaceutical Giant to Pay $39M in Kickback Scheme Settlement

A global pharmaceutical manufacturer with US headquarters in Parsippany has to pay the federal government $39 million in civil damages and penalties for alleged false claims to Medicaid and other federally-funded health care programs, Acting Attorney General John Hoffman announced.

Daiichi Sankyo, Inc., is alleged to have committed False Claims Act violations by using “lavish meals and speaker program honoraria as kickback vehicles to induce physicians to prescribe its drugs Azor, Benicar, Tribenzor, and Welchol,” Hoffman said in a statement.

Of that $39 million settlement, $690,000 will go to the state of New Jersey.

The original lawsuit was filed by a former sales representative of Daiichy Sankyo in 2010, which alleged the health insurance claims related to drugs manufactured by the company were false because they resulted in kickbacks the company had provided to physicians who prescribed the drugs, Hoffman said.

The scheme lasted more than six years, from Jan. 1, 2005 to March 31, 2011, Hoffman said, as doctors participated in Physician Opinion & Discussion programs. The promotional speaker programs went on longer, from Jan. 1, 2004 to Feb. 4, 2011.

Of the $690,000 going to the state of New Jersey, slightly more than half will go to the federal government for its portion of the Medicaid program, and to the former Daiichi Sankyo sales representative that brought the original legal action.

A total of 49 states, including New Jersey, along with the District of Columbia, are participating in the Daiichi Sankyo settlement.

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