Novartis to pay US$72.5m to resolve TOBI allegations
US Justice Department alleges that Novartis marketed cystic fibrosis drug for unapproved uses
Novartis has agreed to pay US$72.5m to resolve civil False Claims Act allegations arising from the marketing of the cystic fibrosis drug TOBI, the US Justice Department said this week.
The settlement resolves allegations that, between 1 January 2001 and 31 July 2006, Novartis and its predecessor, Chiron Corporation, submitted false claims to federal healthcare programmes for certain off-label uses of the drug.
The US Food and Drug Administration (FDA) approved TOBI, an inhaled antibiotic, for the treatment of cystic fibrosis. The US Justice Department alleges that Chiron, and then Novartis, marketed TOBI for unapproved uses, such as diseases other than cystic fibrosis, and for cystic fibrosis patients who did not meet the parameters of the FDA-approved indication and for which TOBI was not a medically accepted use.
‘Pharmaceutical companies must not promote their drugs for uses that have not been proven to be safe and effective,’ said Tony West, assistant attorney general for the Civil Division of the Department of Justice. ‘We are committed to pursuing False Claims Act violations and recovering taxpayer dollars lost to off-label marketing.’
Under the agreement, the proceeds from the settlement will be divided between the federal government and various states, with the US receiving US$43.5m to resolve the federal claims, and the states receiving US$29m.
The settlement resolves a lawsuit brought by three former Chiron employees – Robert Lalley, Courtney Davis and William Manos – under the qui tam or whistleblower provisions of the False Claims Act. They will receive US$7.8m of the federal share of the settlement.
This settlement is part of the US government's drive to reduce healthcare fraud. The Justice Department's total recoveries in False Claims Act cases since January 2009 have topped US$3bn.