July 1 (UPI) -- Novartis Pharmaceuticals agreed to pay more than $642 million in a pair of settlements stemming from charges that it violated the False Claims Act, the Justice Department said Wednesday.
The New Jersey-based company paid $51.25 million in response to allegations that it illegally paid the copay obligations for patients taking its drugs and further agreed to pay $591,442,008 to settle charges that it paid kickbacks to doctors to prescribe its drugs.
Novartis will also forfeit $38.4 million under the Civil Asset Forfeiture Statute.
In the first case, Novartis was accused of using three foundations as conduits to pay the copayments of Medicare patients taking its drugs Gilenya and Afinitor.
The second case accused the company of paying doctors for what they claimed was compensation for delivering lectures about its medications, but the government alleged that "many of these programs were nothing more than social events held at expensive restaurants" where the drugs were not discussed.
"For more than a decade, Novartis spent hundreds of millions of dollars on so-called speaker programs, including speaking fees, exorbitant meals and top-shelf alcohol that were nothing more than bribes to get doctors across the country to prescribe Novartis's drugs," Acting U.S. Attorney for the Southern District of New York Audrey Strauss said.
As part of the settlement, Novartis entered into a corporate integrity agreement with the Departement of Health and Human Services to "significantly reduce" the number of paid speaker programs it implements.
"Through this settlement and others, the government has demonstrated its commitment to ensuring that drug companies do not use kickbacks to influence the drugs prescribed by doctors or purchased by patients," Assistant Attorney General Jody Hunt said. "We will continue to safeguard the Medicare program from kickbacks and their pernicious effects including the undermining of important cost-control mechanisms instituted by Congress."