US claims $3.3 bn in Novartis kickback lawsuit

The US has claimed $3.3 billion in a suit from Novartis AG for paying kickbacks to increase sales of two prescription drugs.

According to the US Department of Justice (DoJ), a group of specialty pharmacies submitted thousands of fraud-tainted reimbursement claims to Medicare and Medicaid for the two drugs, Exjade and Myfortic.

The DoJ is seeking civil fines against the drugmaker in a case that will go on trial in New York in November.

The US disclosed the amount it sought in a court filing Monday.

Novartis is accused of referring patients to specialty pharmacies and paying kickbacks in the form of rebates to get them to recommend the drugs to patients to boost sales.

According to the DoJ, the scheme violated the False Claims Act and Anti-Kickback Statute.

The suit filed in 2012 came as a whistle-blower claim by David Kester, a former Novartis employee. The DoJ is joined in the claims involving Exjade by 11 states that intervened in the suit.

The suit seeks $11,000 in fines for each of 161,011 Exjade and Myfortic claim submitted by the pharmacies to the government health care programmes. It is also seeking triple damages on the basis of $507.5 million they received in reimbursements.

The DoJ said Novartis AG should pay as much as $3.35 billion in damages and civil fines because the Swiss drugmaker used kickbacks to boost sales of the two drugs covered by Medicare and Medicaid.

In addition the DoJ is seeking as much as $1.52 billion in damages, representing triple the sums allegedly reimbursed and tainted by kickbacks between 2004 and 2013.

Novartis "continues to dispute the allegations and is continuing to defend itself in this litigation," company spokeswoman Julie Masow said. "We look forward to a full presentation of all of the evidence during the trial."

A jury trial would get under way 2 November and could last several weeks, according to court papers. The DoJ often settled False Claims Act cases before trial.