The government has some pretty potent tools in its arsenal when it suspects that individuals or businesses have engaged in illegal behavior. One of the most powerful weapons that they use against California companies is the False Claims Act. This could result in a large fine or civil action.
The company settled pharmaceutical fraud allegations
One example of recent government enforcement action is a recent settlement agreement, in which a Delaware company agreed to pay the federal government $12.6 million to resolve allegations that it paid kickbacks for purchases of its drugs. According to the description of the facts, Incyte Pharmaceuticals established a fund to aid myelofibrosis patients. These are the people who benefited from the company’s product. The fund helped them by paying the co-payments for their pharmaceutical purchases from the company. The problem was that Incyte also made payments to people taking the drug who did not have the disease, causing false claims to be submitted to the government.
False Claims Act allegations need to be taken seriously
When companies submit invoices that rely in part on false assumptions or illegal conduct, they may be deemed to have presented a false claim. The federal government takes these seriously. They have the legal ability to levy a fine of up to three times the damages that they claim to have suffered. Many defendants in pharmaceutical fraud cases may choose to negotiate a settlement with this prospect hanging over their heads.
When companies are being investigated for pharmaceutical fraud, they need an attorney who knows how to talk to federal attorneys. Many of these cases end up being resolved through engagement with DOJ. In some cases, your attorney may need to fight on your behalf or persuade the government that they have a weak case against you. No matter what, you need legal help when facing a False Claims Act investigation.