US, Japan file complaints against Novartis

Authorities in the US have sued Novartis in a kickback scheme Keystone

Basel-based pharmaceutical firm Novartis paid kickbacks to a New York chemist’s in exchange for recommending refills of a blood transfusion drug it produces, according to an amended complaint filed in a civil case brought by state and federal prosecutors in New York.

This content was published on January 9, 2014 minutes and agencies

The New Jersey-based company boosted its sales of the iron-reduction drug Exjade by giving referrals and rebates to pharmacy BioScrip, which recommended refills to its patients but often failed to warn them of the drug’s potentially fatal side effects. These include kidney failure and gastrointestinal haemorrhaging, according to the complaint filed in Manhattan federal court on Wednesday.

BioScrip agreed to pay $15 million (CHF13.6 million) to settle charges that it caused pharmacies to submit tens of thousands of false claims to federal health programmes Medicare and Medicaid, said New York Attorney General Eric T. Scheniderman.

“This arrangement between Novartis and BioScrip was dangerous for patients and is against the law,” he said in a statement. “Our lawsuit against Novartis and our agreement with BioScrip send a clear message: drug companies cannot pay pharmacies to promote drugs directly to patients.”


In a statement, Novartis disputed the allegations and said it would defend itself against the litigation.

“Patients are the focus of all that we do,” said company president André Wyss. “We want to support the best possible outcome for a patient taking a Novartis medication prescribed by their physician.”

A spokesman for BioScrip didn't return a message seeking comment.

As part of its settlement with the government, BioScrip said that, beginning in 2007, Novartis told the pharmacy its refills for Exjade patients were too low and that it would lose referrals if it didn’t raise its numbers, according to court documents.

The pharmacy, using employees in an Ohio call centre, encouraged patients – some of whom had stopped using the drug – to refill their Exjade orders, according to the lawsuit, which seeks tens of millions of dollars in Medicare and Medicaid reimbursements.

In April 2013, federal prosecutors sued Novartis, accusing it of using kickbacks disguised as rebates to turn 20 or more chemist’s into a sales force for its own drug, Myfortic, which is used for kidney transplant patients.

And in Japan…

Novartis has also been hit with a criminal complaint by Japan’s health ministry, which alleges exaggerated advertising for the heart condition and blood-pressure lowering drug Diovan.

Novartis Pharma, the company’s local unit, issued an apology on Thursday for “troubles and concerns” over the advertising, which cited clinical studies conducted in Japan that included false data.

The health, labour and welfare Ministry said in a notice it suspected Novartis continued using adverts citing the studies after learning data in them had been manipulated. Novartis has denied it was aware of the problem and says studies have confirmed the safety and effectiveness of the drug.

The company says it is cooperating with authorities.

Diovan, also known as valsartan, is sold around the world.

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