Published on:

Amgen Agrees to Largest Civil and Criminal False Claims Act Settlement in U.S. History

Fortune 500 company and biotech giant, Amgen, Inc., pleaded guilty in the U.S. District Court for the Eastern District of New York to charges that it illegally introduced a misbranded drug, Aranesp, into interstate commerce. Amgen also agreed to pay $612 million to settle related civil allegations that it caused false claims to be submitted to federal healthcare programs Medicare, Medicaid and Tricare, regarding Aranesp and other drugs it manufactures.

Aranesp is an erythropoiesis-stimulating agent that was approved by the Food and Drug Administration (“FDA”) to treat anemia in certain individuals, including those with chronic kidney disease and patients undergoing chemotherapy. The Food, Drug and Cosmetic Act prohibits the introduction of drugs into the marketplace that are intended for uses or at doses not approved by the FDA.

The Department of Justice alleged that from 2002 to 2007 Amgen sold Aranesp with the intention that it be used at off-label doses and for an off-label treatment. Specifically, the government alleged that Amgen promoted the use of Aranesp in less frequent dosing schedules than were approved by the FDA and for use by anemic cancer patients who had not been prescribed chemotherapy. The FDA previously determined that Aranesp use by cancer patients who were not undergoing chemotherapy caused an increased risk of death.

The government alleged that Amgen’s core business strategy was the company’s misbranding of Aranesp to gain market share from the drug’s only competitor – Procrit, sold by Johnson & Johnson. As part of Amgen’s criminal guilty plea agreement, it will pay a $136 million fine and forfeit $14 million of its illegally obtained profits.

The civil allegations that Amgen caused improper submissions to government health care programs in violation of the False Claims Act concern the drugs Aranesp, Enbrel, and Neulasta. Ten different whistleblowers brought lawsuits under the qui tam provisions of the False Claims Act against Amgen for allegedly marketing the drugs for off-label uses not covered by Medicare, Medicaid and other government insurance programs. Seven of the qui tam actions are pending in New York; two are pending in Massachusetts and one is pending in Washington State. Under the qui tam provisions, the whistleblowers may be entitled to share in a percentage of the settlement amount as their reward.