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A $625 million False Claims Act settlement has been reached to resolve several whistleblower lawsuits alleging fraud and deceptive business practices.
Three lawsuits filed by four whistleblowers against AmerisourceBergen Corp. have been resolved through a $625 million False Claims Act settlement – among the ten largest False Claims Act settlements in history.
One of the whistleblowers was a former COO for AmerisourceBergen and provided a unique insider’s perspective into the alleged fraud. The other three whistleblowers worked in a healthcare setting where they became concerned that the mass production of Amerisource pharmaceuticals was in violation of federal laws.
The whistleblowers all brought detailed allegations in their lawsuits which assisted the U.S. government in reaching a successful False Claims Act settlement.
“You can never assume that a company’s fraudulent conduct will be hermetically sealed off such that only insiders can find it,” an outside lawyer told Law360.
AmerisourceBergen was accused of a variety of actions which allegedly compromised the integrity of the products. Particularly, the company sold prefilled syringes of drugs which alarmed healthcare professionals. Transferring drugs into a prefilled syringe can sometimes cause the product to be contaminated with bacteria and particles which is why intravenous medications are most commonly sold in glass vials.
Two of the whistleblowers who worked as pharmacists also claimed that they received syringes prescribed for nonexistent patients that held more medication than the proper dosage called for.
The fourth whistleblower involved in the False Claims Act settlement was a physician group, Omni Healthcare Inc. The group allegedly witnessed firsthand the scheme to unlawfully repackage and sell drugs used by cancer patients.
“They were approached and witnessed firsthand the scheme as it was deployed and promoted to them,” plaintiff counsel told Law360. “They were the target audience for the scheme.”
The False Claims Act allows witnesses to fraudulent behavior to bring lawsuits on behalf of the federal government. If the US government decides to intervene in the lawsuit, and a False Claims Act settlement or verdict is reached, whistleblowers are eligible to recover an award for exposing fraudulent behavior.
Individuals who work or worked for the company committing fraud are often in the best position to bring whistleblower lawsuits. Because they often witness firsthand the fraud and may have evidence, their allegations are more likely to yield a False Claims Act settlement or verdict.
“There will always be categories of outsiders who may be situated such that they may identify the fraud, most obviously the targets of the fraudulent marketing,” an outside lawyer told Law360. “Doctors, pharmacists, subcontractors [and] even competitors with experience and expertise may not know exactly what is going on, but they may be able to piece together enough of it to hear alarm bells.”
However, this is not to say that outsiders are incapable of bringing successful whistleblower claims. More work is often required to provide evidence, but these plaintiffs can reach a successful False Claims Act settlement.
The False Claims Act Settlement Cases are Case Nos. 1:10-cv-04856, 12-cv-01178, and 1:14-cv-05278, in the United States District Court for the Eastern District of New York.
In general, whistleblower and qui tam lawsuits are filed individually by each plaintiff and are not class actions. Whistleblowers can only join this investigation if they are reporting fraud against the government, meaning that the government must be the victim, and that the alleged fraud should be a substantial loss of money.
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If you believe that you have witnessed fraud committed against the government, you may have a legal claim. Whistleblowers can only join this investigation if they are reporting fraud against the government, meaning that the government must be the victim, and that the alleged fraud should be a substantial loss of money.
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