Fortune 500 biotech firm Amgen, Inc., based in California, has agreed to pay $24.9 million to settle allegations that it defrauded various federal and state health programs including Medicare and Medicaid. According to Florida Attorney General Pam Bondi, $14.7 million of the settlement amount will be shared among several states, with Florida to receive $207,000.
The settlement resolves allegations first made by Amgen employee Frank Kurnik in a whistleblower action brought under the qui tam provisions of the False Claims Act. The whistleblower alleged that Amgen paid illegal kickbacks to three institutional pharmacies – Omnicare, PharMerica Corp and Kindred Healthcare. According to the complaint, the kickbacks were paid in return for the pharmacies’ implementation of “therapeutic interchange” programs in the nursing homes or long-term care facilities they served. Therapeutic interchange programs were allegedly designed to induce medical professionals to switch Medicare and Medicaid patients from Procrit to Amgen’s anemia drug Aranesp,
Kurnik will receive a portion of the settlement amount as his reward under the qui tam provisions of the False Claims Act.
Last year, Amgen accepted a guilty plea for illegally introducing Aranesp into interstate commerce as a misbranded drug. At that time, Amgen also agreed to pay $762 million to resolve criminal and civil liability arising from its sale and promotion of certain drugs. The blog post concerning that action can be found here.