BOSTON, July 20, 2022 /PRNewswire/ — Greene LLP announces that the international pharmaceutical company, Biogen, Inc, has agreed to pay $900 million to resolve claims brought by Michael Bawduniak, a client of Greene LLP, that Biogen unlawfully paid kickbacks to physicians and other healthcare professionals. The settlement will be paid to the United States and the Medicaid programs of various states in resolution of the False Claims Act action in which the United States did not intervene.
“We believe this settlement represents the largest recovery in the over 150 years of False Claims Act cases to be secured by a whistleblower without the intervention or participation of the United States,” said attorney Thomas M. Greene, who served as Mr. Bawduniak’s lead counsel throughout more than a decade of litigation.
In 2012, Mr. Bawduniak disclosed to the United States that he believed Biogen, for whom he was then employed, was improperly paying kickbacks to its largest prescribers to discourage them from prescribing Biogen’s competitors’ products. Mr. Bawduniak had reported his concerns to Biogen’s compliance department, which had not taken any action. Based on Mr. Bawduniak’s information, the Department of Justice and the Federal Bureau of Investigation asked Mr. Bawduniak to record conversations with Biogen employees that would substantiate his allegations. These recordings confirmed that Biogen deliberately provided substantial monetary and non-monetary compensation to some of its most important prescribers to influence their prescribing and to ensure that they remained loyal Biogen customers.
Thereafter, in April 2012, Greene LLP, on behalf of Mr. Bawduniak, filed a lawsuit in the United States District Court for the District of Massachusetts under the federal False Claims Act and the false claims acts of several states. Mr. Bawduniak alleged that Biogen, to prevent its multiple sclerosis drugs from losing market share to newer drugs, knowingly paid its largest prescribers for services Biogen did not need and never intended to use, and which payments served no legitimate business purpose.
For example, Biogen paid hundreds of its customers to provide consulting advice on topics it either could not use, or for which Biogen had all the information it required. Additionally, Biogen also paid hundreds of health care professionals to speak when there was no demand for presentations on Biogen’s products and Biogen knew that its prospective speakers would likely never meet their minimum speaking requirements. Mr. Bawduniak also discovered that Biogen knowingly compensated its speakers and consultants a rate significantly exceeding the fair market value for their services. For example, Biogen inflated the amounts paid to most of its speakers and consultants by automatically adding three hours for travel time to their compensation, even when Biogen knew the customers whom it paid did not have to travel or only traveled a minimal distance. And many of Biogen’s events were held at sumptuous resorts and restaurants, where Biogen treated its speakers and consultants to lavish meals and free alcohol.
“The excessive consultant meetings always stood out to us as evidence of an improper purpose for these payments to physicians,” said Greene. “Over the years, as we learned more and more and gained feedback from nationally renowned experts, we were confident that a jury would agree: the only reasonable explanation for this kind of activity by Biogen was its belief that the prescribers it paid would be more likely to prescribe their drugs.”
The Biogen lawsuit was not Greene’s first foray into lengthy False Claims Act litigation. In 1996, he brought an action on behalf of a whistleblower alleging that off-label promotion of the drug Neurontin defrauded the United States. That case was resolved in 2004 when Pfizer, Inc. agreed to pay $430 million in civil fines and criminal penalties. Although the United States also elected not to intervene in the Neurontin case, that case became the model that ultimately led to the United States recovering more than $15 billion for unlawful off-label promotion by other drug companies.
The federal False Claims Act and several state statutes allow persons to file qui tam claims on behalf of federal or state governments when they have knowledge of schemes to defraud them. The statutes authorize those governments to intervene in such suits, but also permit the qui tam whistleblowers to pursue their claims if the governments elect not to intervene, which is what happened with Mr. Bawduniak’s action.
“Since July 2015, when the United States informed the District Court that it would not intervene in this action, our firm has litigated the case alone, reviewing millions of documents, conducting dozens of depositions, and preparing the case for trial,” said Greene. “The settlement with Biogen is a great example of what the False Claims Act is designed to encourage – and taxpayers clearly benefit.” As a result of the announced settlement, Mr. Bawduniak will receive an award of between 25% and 30% of the federal portion of the recovery, as well as awards from the states who will share in the settlement.
Michael Bawduniak was represented in the False Claims Act suit by Greene, Michael Tabb, Ryan P. Morrison, Tucker D. Greene, Simon Fischer, Eugenie Reich, and Kiel Green, all members of the Greene LLP firm. Greene LLP is a complex civil litigation firm in Boston specializing in representing qui tam whistleblowers with a low-volume, high-attention approach to litigation.
Contact: Thomas M. Greene Greene LLP (617) 261-0040 [email protected]
