Taxpayers Saved Billions By Novartis AG Whistleblower

The False Claims Act is the leading tool for corporate insiders to come forward and report what they know to the US Department of Justice

Thursday, September 20, 2018 - Novartis sales manager David Kester blew the whistle on his company's over-aggressive and illegal drug marketing schemes that resulted in billions in illicit profits for the company and put public health at risk. Kester efforts in teaming with the US Department of Justice eventually led to the government fining Novartis $1 billion under the False Claims Act (FCA). Wikipedia.com defines the FCA as "an American federal law that imposes liability on persons and companies (typically federal contractors) who defraud governmental programs. It is the Federal Government's primary litigation tool in combating fraud against the Government."

The provisions of the FCA state that there are significant criminal and civil penalties for those found guilty at trial. The government can impose a fine of between $5000 and $10,000 for every instance of fraud. Pharmacists in the Novartis case filled thousands of fraudulent claims on behalf of drug patients resulting in the $1 billion fine. The Novartis fraud case is the perfect example of how effective and vital the FCA can be. In addition to retrieving hundreds of millions for the taxpayer, Kester's whistleblowing probably saved hundreds of lives as well.

One of the drugs illicitly marketed was Tasigna, an anti-cancer chemotherapy drug that Novartis rushed to market to replace Gleevec. Specialty pharmacists were bribed to refill Gleevec prescriptions with Tasigna without alerting the patient as to Tasigna's atherosclerosis and sudden death risks. Tasigna patients have had to undergo coronary bypass operations to alleviate the symptoms of arterial blockages caused by Tasigna. So many complaints of heart disease from taking Tasigna prompted the US FDA to require Novartis to place a black box warning label on the drug, a designation reserved only for drugs that have the potential to cause serious injuries or death.

Novartis settled the case for $390 million and a subsequent government lawsuit laid bare the details of the fraudulent marketing scheme. Whistleblowers that uncover wrongdoing inside pharmaceutical companies receive up to $25 of the amount of money recovered by the government. Such a high percentage is an incentive to come forward and save taxpayers billions in Medicaid and Medicare fraud. According to Bloomber.com, "The U.S. sued Novartis in 2013, intervening in a case filed earlier by a whistle-blower alleging the Basel, Switzerland-based company regularly provided doctors with expensive dinners, fishing trips, fees to speak at events to boost sales of the company's drugs." Novartis sales reps conducted over 80,000 events with doctors in order to illegally funnel money to them in exchange for prescribing their drugs. Novartis sales reps would set up phony educational seminars and the doctor would speak at the event for which they were paid a fee. These events were merely shells as very few doctors showed up for the drug education. Even if they did, the event would turn out to be little more than a Tasigna drug sales presentation. The government's case against Novartis is in its seventh year. Former Novartis sales reps are scheduled to testify for the prosecution. Tasigna lawsuits continue to be filed by patients that suffered from Tasigna side effects.

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