A whistleblower who sued Sanofi-Aventis U.S. for allegedly scheming Medicare out of millions of dollars has helped the U.S. government land an $11.85 million settlement.
The whistleblower, a former employee of Sanofi’s predecessor, Genzyme Corporation, filed a False Claims Act lawsuit against Sanofi-Aventis alleging the drugmaker used a non-profit organization to illegally funnel money to Medicare patients taking Lemtrada, a costly multiple sclerosis (MS) drug.
According to the U.S. Attorney’s Office for the District of Massachusetts, Sanofi-Aventis sought to circumvent the Medicare copays for Lemtrada, which can cost about $100,000 per patient annually. That means the copays that Medicare Part B patients must pay as required by law can cost thousands of dollars a year, making Lemtrada off-limits for many.
To ease the financial burden of Lemtrada on Medicare beneficiaries, Sanofi-Aventis paid the copays of Medicare patients taking Lemtrada through a charitable foundation called The Assistance Fund (TAF). The drug company accomplished this by providing charitable donations to TAF, which in turn used them to pay the copays of Lemtrada patients. Federal officials said that TAF raised its maximum per-patient grant allocation to $20,000 to accommodate these costly copays.
Making Lemtrada affordable to Medicare patients helped Sanofi-Aventis boost the drug’s sales, the whistleblower lawsuit alleged.
Federal officials investigating the whistleblower’s allegations found evidence that Sanofi made payments to TAF not for charitable purposes but with the intention of using the charity as a conduit to pay the Medicare copay obligations of Lemtrada patients. They also found that TAF facilitated the scheme by working with its partners to identify Medicare patients who needed Lemtrada and had a prescription for it but couldn’t afford the copay obligations.
Sanofi-Aventis also coordinated its “donations” to TAF in other ways that would ensure a disproportionately large share of them would go to patients taking Lemtrada and that patients taking other MS drugs would get substantially smaller copay grants, federal officials alleged.
According to the whistleblower lawsuit, the drug company’s scheme violated the Anti-Kickback Statute, a federal law that in the health care context prohibits improper referrals and financial arrangements designed to loot Medicare and other federal health care programs.
“Sanofi sought to undermine the Medicare program through its use of kickbacks disguised as routine charitable donations aimed at helping patients battling multiple sclerosis and who were struggling with costly copays,” said Joseph R. Bonavolonta, Special Agent in Charge of the FBI’s Boston Division. “They rigged the system so those taking its drug Lemtrada gained an unfair advantage over patients using other medications, and with today’s settlement, they are finally being held accountable for their actions.”
The whistleblower whose lawsuit led to the $11.85 million settlement will receive approximately $2.7 million (22.7%) of the total recovery, the U.S. Attorney’s Office said.
If you have any questions about whether you qualify as a whistleblower, contact one of the lawyers on our firm’s Whistleblower Litigation Team for a free and confidential evaluation of your claim. Beasley Allen lawyers Larry Golston, Lance Gould, Paul Evans, Leon Hampton, Tyner Helms, and Lauren Miles are working in this area of law known as qui tam cases. A lawyer on the team will be glad to discuss the potential claim with you either in person or by phone.