May 5th, 2011

Settlement Reached In MS Drug Case

The Wall Street Journal

Multinational drugmaker Merck Serono SA has agreed to pay $44.3 million to settle allegations that it illegally promoted one of its drugs using kickbacks to doctors, the U.S. Department of Justice said Wednesday.

Federal prosecutors said the company allegedly made inappropriate payments to hundreds of doctors for prescribing its multiple sclerosis drug, Rebif, between 2002 and 2009. Merck Serono paid to send doctors to various training meetings and conferences at upscale resorts and other locations, according to the Department of Justice.

Merck Serono is a unit of German pharmaceutical and chemical company Merck KGaA. The company isn’t related to U.S. drugmaker Merck & Co.

“The health care of our seniors and other vulnerable citizens under the Medicare and Medicaid programs should be based upon sound medical decisions, not upon decisions tainted by influence and corruption,” said Tony West, assistant attorney for the Justice Department’s civil division.

Federal prosecutors said the kickbacks resulted in “false claims” being billed to Medicare and Medicaid.

The Department of Justice has increasingly used the False Claims Act to target pharmaceutical marketing in recent years, reaching multibillion-dollar settlements with Pfizer Inc., Eli Lilly & Co. Inc. and other drugmakers.

Rebif is Merck Serono’s best-selling product with sales of roughly $2.5 billion last year. Calls placed to Merck Serono’s U.S. offices weren’t immediately returned Wednesday.

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