A New Jersey federal judge has reopened a False Claims Act (FCA) suit against Sanofi-Aventis US LLC and Bristol-Myers Squibb Co. This development came after the U.S. Supreme Court ruled in Escobar that liability under the statute can be triggered by failure to comply with regulations that aren’t explicit conditions of payment. U.S. District Judge Freda L. Wolfson, in a text order, resumed the case accusing Sanofi and BMS of deceptively marketing the blood thinner Plavix. The Supreme Court justices had backed what’s known as “the implied-certification theory” on June 16 in Universal Health Services v. Escobar, a case that has generated lots of attention. The theory holds that companies implicitly certify compliance with regulations when seeking payment from the government and may commit fraud if they are actually out of compliance.

In the Escobar case, those requirements were about staffing criteria. In the instant case there were state laws regarding cost-effectiveness that the companies were said to have dodged. The Defense bar has argued that fairness requires making clear which conditions are essential, but the government warned that such a rule would allow corporations to flout regulations that aren’t conditions of payment without fear of FCA punishment. The Plavix case was stayed in December at the request of all parties, pending the high court’s ruling in Escobar.

Elisa Dickson, the former Sanofi sales representative, is pursuing the qui tam suit over Plavix. She claims health care programs paid for unnecessary prescriptions because BMS and Sanofi, the co-marketers of the drug, misled physicians on the efficacy of the blood thinner compared with cheaper alternatives.

Judge Wolfson dismissed claims involving 33 states in August, but retained claims for the remaining 17 states, which have those cost-effectiveness requirements on the books. For most states, that condition on reimbursement isn’t accompanied by any specific restrictions that would overcome straightforward language in the federal Medicaid statute that “a drug that has been approved by the FDA, such as Plavix, is considered a “covered outpatient drug” reimbursable under Medicaid when that drug is prescribed for its on-label use,” Judge Wolfson had said. The case brought by Ms. Dickson – who started working at BMS in 1999 and moved to Sanofi in 2003 – was among nine Plavix suits that the U.S. Judicial Panel on Multidistrict Litigation consolidated in New Jersey in 2013.

Ms. Dickson is represented by Christopher Cueto of The Law Office of Christopher Cueto Ltd. The case is U.S. et al., ex rel. Elisa Dickson v. Bristol-Myers Squibb Co. et al., in the U.S. District Court for the District of New Jersey.

Source: Law360.com

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