Biogen finalizes $900 million drug kickback settlement, U.S. says

[September 27, 2022]  By Nate Raymond

BOSTON (Reuters) -Biogen Inc has finalized a $900 million settlement resolving a whistleblower lawsuit accusing the biotech company of paying doctors kickbacks to prescribe multiple sclerosis drugs, the U.S. Department of Justice said on Monday.

The settlement resolves a long-running whistleblower lawsuit in Boston federal court that a former employee pursued on the government's behalf. Biogen in July disclosed it reached a potential settlement, which was subject to government approval.

For pursuing the case, the former employee, Michael Bawduniak, will receive $266.4 million from the settlement, said his lawyer, Thomas Greene. That sum shatters previous records for U.S. whistleblower awards, Greene said.

Cambridge, Massachusetts-based Biogen did not admit wrongdoing as part of the accord. In a statement, Biogen said it "believes its intent and conduct was at all times lawful and appropriate."

The lawsuit accused Biogen of directing millions of dollars in kickbacks to doctors to prescribe its MS drugs Avonex, Tysabri and Tecfidera from 2009 to 2014. The kickbacks came in the form of "sham" consulting deals and speaker programs as well as lavish dinners and entertainment, the lawsuit said.

A test tube is seen in front of displayed Biogen logo in this illustration taken, December 1, 2021. REUTERS/Dado Ruvic/Illustration

The scheme resulted in false claims for payment being submitted to the government healthcare programs Medicare and Medicaid, the lawsuit alleged.

The case was filed in 2012 by Bawduniak under the False Claims Act, which allows whistleblowers to sue companies on the government's behalf to recover taxpayer money spent on fraudulent claims.

The Justice Department may intervene in such cases and litigate them itself following an investigation, though in 2015 it opted against doing so in Bawduniak's case, leaving him to pursue the case himself.

Greene, his lawyer, has called the settlement the largest recovery in over 150 years of False Claims Act cases to be secured by a whistleblower without the intervention or participation of the government.

(Reporting by Nate Raymond, Eric Beech and Rami Ayyub; Editing by Chris Reese and Cynthia Osterman)

[© 2022 Thomson Reuters. All rights reserved.] 

This material may not be published, broadcast, rewritten or redistributed.  Thompson Reuters is solely responsible for this content.