On September 2, the Department of Justice announced, “Bayer Corporation, an Indiana corporation and manufacturer of pharmaceutical products, and its related entities, Bayer HealthCare Pharmaceuticals Inc., Bayer HealthCare LLC and Bayer AG (collectively “Bayer”), have agreed to pay $40 million to resolve alleged violations of the False Claims Act in connection with the drugs Trasylol, Avelox and Baycol.”

The settlement stemmed from whistleblower lawsuits filed in 2005 and 2006 by Laurie Simpson, a former Bayer employee who worked in its marketing department. Under the qui tam or whistleblower provisions, private citizens can bring suit on behalf of the government for false claims and share in any recovery. The United States may intervene in the action or, as in this case, the whistleblower may proceed with the matter. “Simpson diligently pursued this matter for almost two decades,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Department of Justice’s Civil Division.  Simpson will receive about $11 million from the settlement.

According to the DOJ, Simpson alleged that Bayer paid kickbacks to hospitals and physicians to induce them to use the drugs Trasylol and Avelox, and also marketed these drugs for off-label uses that were not reasonable and necessary. Simpson further alleged that Bayer downplayed the safety risks of Trasylol. The lawsuit alleged that, as a result of this conduct, Bayer caused the submission of false claims to the Medicare and Medicaid Programs and violated the laws of 20 states and the District of Columbia.

Simpson filed a second lawsuit relating to a Bayer drug known as Baycol. That lawsuit alleged that Bayer downplayed Baycol’s risks of causing rhabdomyolysis. The lawsuit further alleged that Bayer misrepresented the efficacy of Baycol when compared to other statin drugs. Subsequently, Trasylol and Baycol were withdrawn from the market for safety reasons. 

Bayer did not admit wrongdoing in agreeing to settle. In a statement, it said the settlement “reflects a business decision by the company that resolution was preferable to continuing already protracted litigation.” Under the terms of the settlement, Bayer will pay $38,860,555 to the United States and $1,139,445 to the 20 states and the District of Columbia. 

The attorneys at Chilivis Grubman represent clients of all types and sizes in connection with health care fraud matters. If you need assistance with such a matter, please contact us today.