Novartis inks $390M deal to settle kickback allegations

Novartis AG, a Swiss drug company, has entered into a $390 million settlement with the Department of Justice to settle allegations it paid kickbacks in the form of rebates to specialty pharmacies to increase prescriptions for its drugs.

The lawsuit was initially filed under the qui tam, or whistle-blower, provisions of the False Claims Act, and the government intervened in the case in April 2013.

The lawsuit specifically alleged Novartis paid kickbacks to pharmacies for recommending Exjade, an iron chelation drug, and Myfortic, an anti-rejection drug for kidney transplant recipients.

To resolve the case, Novartis agreed to pay $370 million to settle federal and state false claims allegations. Of the $370 million, nearly $286.9 million will be paid to the federal government, and about $83.1 million will be paid to the settling states. Novartis also agreed to forfeit $20 million as proceeds from the scheme under the civil forfeiture statute.

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