Massachusetts, USA-based DUSA Pharmaceuticals, a subsidiary of India’s Sun Pharmaceutical Industries (SUN: BO), has agreed a settlement with the US Department of Justice (DoJ).
DUSA has agreed to pay the United States $20.75 million to resolve allegations that DUSA caused physicians to submit false claims to Medicare and the Federal Employee Health Benefit Program by knowingly promoting an administration process for the drug Levulan Kerastick (aminolevulinic acid HCl) that contradicted the product instructions approved by the US Food and Drug Administration and was unsupported by sufficient clinical evidence.
“The department is committed to protecting taxpayer-supported health care programs from fraud and abuse,” said Acting Assistant Attorney General Ethan Davis for the Justice Department’s Civil Division, adding: “We will hold drug manufacturers accountable when they knowingly promote ineffective uses of their products that undermine patient care or waste program funds.”
“While this scheme to provide false instructions on the use of its product may have resulted in more sales and bigger profits, it also meant customers endured the frustration of being repeatedly subjected to less effective treatments to try to get their skin lesions to clear,” said US Attorney Brian Moran for the Western District of Washington. “This investigation seeks to restore money to taxpayers and discourage those who put profits over effective treatment.”
“Drug makers that push the inappropriate use of their products undermine the health of patients and the financial integrity of federal health care programs, said Special Agent in Charge Steven Ryan of the US Department of Health and Human Services Office of Inspector General.
The settlement with DUSA resolves a lawsuit filed under the whistleblower provision of the False Claims Act, which permits private parties to file suit on behalf of the United States for false claims and share in a portion of the government’s recovery. The civil lawsuit was filed by Aaron Chung, who formerly worked for DUSA as a sales representative. As part of the resolution, Mr Chung will receive approximately $3.5 million.