Pacira Pharmaceuticals, Inc., with headquarters in Parsippany, New Jersey, has agreed to pay $3.5 million to the United States and 15 states to resolve a whistleblower lawsuit alleging Pacira engaged in a kickback scheme in violation of multiple federal and state laws. The suit, filed by the Philadelphia law firm Ross Feller Casey, LLP, on behalf of a former hospital pharmacist, claimed that Pacira provided kickbacks to healthcare providers and facilities to induce them to utilize Pacira’s product, EXPAREL (bupivacaine liposome injectable suspension), and to give the drug favored status at the institutions. The Medicare and Medicaid health insurance programs then paid for the EXPAREL, which is indicated for administration into a surgical site to provide postsurgical analgesia.
The United States and the whistleblower alleged that Pacira paid kickbacks in the form of grants to certain healthcare providers and/or institutions to spur sales of EXPAREL. They also contended that Pacira sales representatives conditioned the grants upon acceptance of EXPAREL onto the institution’s approved drug list. It was also alleged that certain Pacira executives coached recipients of the grants on how to avoid internal scrutiny of payments related to the grants. Finally, the United States contended that Pacira approved and funded the grants despite receiving little or no formal results from the proposed research and did not document a reasonable commercial need or a fair market value assessment.
“We are very proud to represent our client, a pharmacist who was approached by a Pacira sales representative and had the integrity and courage to recognize the fraud and report it. His courage has saved American taxpayers millions of dollars by putting a stop to Pacira’s scheme,” said Brian J. McCormick, Jr., a partner at Ross Feller Casey, LLP.
“Patients deserve to know that their doctor is making decisions based on their best interests and not because a drug company is offering financial incentives to steer doctors to use certain drugs,” said McCormick, who is among the nation’s top whistleblower lawyers.
Under the settlement, the whistleblower will receive a financial award of more than $635,000. The case was filed pursuant to the qui tam provision of the False Claims Act, which permits a private person to bring a lawsuit on behalf of the United States and share in the suit’s proceeds.
The settlement was the result of a significant effort by the U.S. Attorney’s Office for the District of New Jersey. The government’s legal team that oversaw the investigation and settlement was led by Assistant United States Attorney Andrew Caffrey III.
The lawsuit is United States of America ex rel. Jordan Schneider v. Pacira Pharmaceuticals, Inc., Civil Action No. 2:14-cv-07021 (D.N.J.).
The settlement received press coverage, see below:
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