(Reuters) – US government sues Teva Pharmaceutical Industries Ltd (TEVA.TA) on Tuesday, accused the drugmaker of causing the filing of false claims with Medicare by using kickbacks to encourage the sale of its multiple sclerosis drug Copaxone.
FILE PHOTO: The logo of Teva Pharmaceutical Industries is seen during a news conference by its CEO Kare Schultz in Tel Aviv, Israel, February 19, 2019. REUTERS / Amir Cohen / File Photo
In a lawsuit filed in Boston federal court, the Department of Justice said Teva illegally paid two seemingly independent charitable foundations more than $ 300 million from 2006 to 2015 to cover co-payments from Copaxone patients, and protected them from a fourfold increase in the price of Copaxone to $ 73,326 a year.
The Justice Department said this led to hundreds of millions of dollars in false claims and a corresponding amount of revenue for the Israeli drugmaker, and ran the Congress’ intention that co-payments help maintain drug prices.
“Unrestricted by any market scrutiny on prices due to its payment of illegal kickbacks, Teva caused U.S. taxpayers to shoulder the high prices set by Teva for Copaxone, while Teva exercised the resulting profits for itself,” the complaint said.
The government is seeking triple damages for violations of federal counterfeiting law.
Teva said it would defend him vigorously, saying the lawsuit “only seeks to restrict patients’ access to essential medicines and health care.”
Copaxone is one of Teva’s largest drugs, generating $ 435 million in revenue in North America from January to June alone.
The case is the latest in a federal probe of financial support from drugmakers to charities for patient assistants, which has resulted in more than $ 920 million of settlements.
Drugmakers cannot subsidize co-payments for patients enrolled in Medicare, which includes Americans 65 and older, but can donate to independent nonprofits that offer payment assistance.
According to the complaint, Teva referred Copaxone patients to the Florida-based specialty pharmacy Advanced Care Scripts Inc, which then arranged co-payment coverage from the foundations, the Chronic Disease Fund and The Assistance Fund.
Advanced healthcare scripts and the foundations have previously agreed to pay a combination of $ 9.5 million for related costs.
The case is US v. Teva Pharmaceuticals USA Inc et al, U.S. District Court, Massachusetts District, No. 20-11548.
Report by Jonathan Stempel in New York and Nate Raymond in Boston; Edited by Steve Orlofsky and Dan Grebler
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