Biogen Agrees To Pay $900 Million To Settle Whistleblower Lawsuit: Biogen Inc. (“Biogen”), one of the world’s first global biotechnology companies, announced on July 20, 2022 that it had agreed to a $900 million settlement to resolve a whistleblower lawsuit filed in 2012 that accused it of paying doctors kickbacks to prescribe multiple sclerosis drugs. The trial had been scheduled to begin on July 26, 2022.
Biogen stated in its SEC FORM 10-Q — Quarterly Report For the Quarterly Period Ended June 30, 2022: “Biogen has reached an agreement in principle to resolve previously disclosed litigation pending in the U.S. District Court for the District of Massachusetts alleging violations of the federal False Claims Act and state law counterparts. The litigation was filed by Michael Bawduniak on behalf of the U.S. and certain states and unsealed in 2015. The U.S. has not intervened in the case. The agreement in principle contemplates Biogen making a payment of $900.0 million. The agreement in principle does not include any admission of liability and is subject to the negotiation of final settlement documents and agreements with the named government entities.”
The whistleblower’s Trial Brief stated: “The Relator will prove at trial that defendant Biogen Inc. (“Biogen”) violated the Anti-Kickback Statute, 42 U.S.C. § 1320a-7b(b) (the “AKS”), by directing millions of dollars of kickbacks to Healthcare Providers (“HCPs”) in the form of speaker and consultant honoraria, lavish dinners, and entertainment, for the purpose of inducing those HCPs to prescribe or recommend prescribing Biogen’s Multiple Sclerosis (“MS”) medications: Avonex, Tysabri, and Tecfidera (together the “MS Drugs”). From January 1, 2009 through March 18, 2014 (the “Relevant Period”), Biogen’s kickback schemes caused the submission of hundreds of millions of dollars in false reimbursement claims for Biogen’s MS Drugs to Government healthcare programs, including Medicare and Medicaid (together “Government Healthcare Programs”), in violation of the False Claims Act, 31 U.S.C. §§ 3729-33 (the “FCA”) and eleven States’ false claims acts.”
“The goals of Biogen’s scheme were threefold: to preserve the eroding market share of Biogen’s oldest biological product, Avonex; to increase the market share of its biological product Tysabri, which had been temporarily pulled from the market over safety concerns prior to the Relevant Period; and to ensure that its new oral MS drug, Tecfidera, once approved, would be prescribed at a high rate. Biogen’s scheme was a resounding success. Biogen was able to halt the decline of Avonex’s market share and hold its sales constant. Despite the FDA’s approval of several new MS medications during the Relevant Period, U.S. sales of Avonex grew to $1.5 billion annually. Tysabri sales also continued to grow, despite a black box warning on its label warning of deadly side effects. And when Biogen introduced Tecfidera to the market in 2013, it quickly became a blockbuster drug, far surpassing its forecasted revenue total.”
The federal government did not intervene in the case. The case is captioned United States ex rel Bawduniak v. Biogen Idec Inc, U.S. District Court for the District of Massachusetts, No. 12-cv-10601.
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