Pharmaceutical “Average Wholesale Price” Investigations and Litigation
Dechert represented GlaxoSmithKline in a federal government investigation involving allegations that the company set an “inflated” average wholesale price (AWP) for certain of its products and then promoted those products to its physician customers based on the “spread” between the AWP-based Medicare and Medicaid reimbursement and the actual selling price to the physicians. The investigation and two related False Claims Act cases were resolved in a civil settlement with the federal government and certain states that included a corporate integrity agreement. We have also represented GlaxoSmithKline in related class action litigation and multiple lawsuits filed by state Attorneys General throughout the United States.
Clinical Laboratory Medicaid Billing Litigation
Dechert represented SmithKline Beecham Clinical Laboratories, a major independent clinical laboratory, in connection with a government investigation into its marketing, sales and billing practices. The matter was ultimately resolved through a civil and administrative settlement with the federal government and certain states, which included the settlement of several qui tam actions brought under the federal False Claims Act. In addition, there was subsequent litigation with a group of qui tam relators who filed their cases late and wanted to participate in the settlement, as well as litigation in Louisiana about the viability of the claims of one particular relator. We also represented the company in a variety of related civil suits brought by private payors, including insurance companies, in the wake of the government settlement. Reported False Claims Act decisions include: United States ex rel. LaCorte v. SmithKline Beecham, Inc., 149 F.3d 227 (3d Cir. 1998); 2000 WL 17838 (E.D. La. Jan. 10, 2000); 2000 WL 222843 (E.D. La. Feb. 23, 2000); and 1999 WL 639683 (E.D. La. Aug. 19, 1999).
Clinical Laboratory Billing Litigation in California
Dechert has represented Quest Diagnostics, the largest clinical laboratory in the United States, in a False Claims Act case filed in state court in California. A whistleblower and the state (through the Attorney General’s office) claimed that Medi-Cal (California’s Medicaid program) overpaid our client for clinical laboratory testing services because the laboratory failed to charge Medi-Cal the lowest price charged to other payors for comparable services under similar circumstances.
Pennsylvania Shipbuilding Company Navy Contract Litigation
Dechert defended Pennsylvania Shipbuilding Company in a False Claims Act case alleging that it fraudulently obtained a Navy contract for ships in 1985. The case was eventually dismissed in its entirety. Reported decisions: United States ex rel. Atkinson v. Pennsylvania Shipbuilding Company, et al., 473 F.2d 506 (3d Cir. 2007); 2004 WL 1686958 (E.D. Pa. July 28, 2004); 255 F.Supp.2d 351 (E.D. Pa. 2002); 2000 WL 1207162 (E.D. Pa. Aug. 24, 2000).
Medicaid “Best Price” Investigation
Dechert represented a major pharmaceutical manufacturer in an investigation by the U.S. Department of Justice into its alleged failure to report, as its “best price” under the Medicaid Rebate Program, the price of certain products sold to a health maintenance organization that repackaged and relabeled the products under its own National Drug Code numbers. The case was resolved by civil settlement with the federal government and the states that resulted in the dismissal of a number of federal False Claims Act cases and included a corporate integrity agreement.
California False Claims Act Litigation
We represented three leading corporate trust operations in three False Claims Act cases. In the largest case, the State of California and more than 300 political subdivisions intervened and sought more than $4 billion in damages from Bank of America for alleged mishandling of public funds. After the first phase of a trial, the court issued a tentative ruling favoring the bank on all points, which led to a creative mediation and successful settlement.
Pharmaceutical “Adulterated Products” False Claims Act Litigation in Texas
Dechert represented SmithKline Beecham Corporation in a False Claims Act case brought against 25 major pharmaceutical manufacturers alleging that they defrauded the United States by selling to the government a product that was “adulterated” because it was not manufactured in accordance with good manufacturing practices. The complaint was dismissed with prejudice for failure to comply with Rule 9(b) of the False Claims Act. Reported decision: United States ex. Rel. King v. Alcon Labs et al., 2005 WL 20372 (N.D. Tex. Jan. 4, 2005).
False Claims Act Litigation
Dechert represented a Harvard professor in a False Claims Act case involving contracts between Harvard and the United States Department of State for advisory work in Russia. The case involved an extensive investigation, motions practice, a trial against some defendants and a favorable settlement for our client. Reported decision: United States v. President and Fellows of Harvard College, 323 F.Supp.2d 151 (D. Mass. 2004).
Stark Law and Anti-Kickback Litigation
Dechert represented Quest Diagnostics in a False Claims Act case that alleged that the company paid kickbacks to physicians and otherwise violated the Stark law in providing various goods and services to physicians. The case was eventually dismissed on summary judgment. Reported decisions: United States ex rel. Urbanek v. Quest Diagnostics Incorporated, 2005 WL 78931 (E.D.Pa. Jan. 12, 2005); 2003 WL 22795324 (E.D. Pa. Nov. 21, 2003).
California Relator Litigation Alleging Improper Performance of Laboratory Testing
Dechert represented SmithKline Beecham in a False Claims Act case brought by a former employee who alleged that our client billed the government for improperly performed laboratory testing. The district court dismissed the amended complaint for failure to comply with Rule 9(b). The Ninth Circuit affirmed the ruling on Rule 9(b), but ordered the lower court to give the plaintiff an additional opportunity to amend his complaint. The case eventually settled. Reported decision: United States ex rel. Lee v. SmithKline Beecham, Inc., 245 F.3d 1048 (9th Cir. 2001).
Patent “False Marking” Litigation
Dechert represents Church & Dwight, a major manufacturer of consumer products, in patent “false marking” cases filed in California and Pennsylvania under the “whistleblower” provisions of the U.S. patent laws. The complaints, which were filed by an entity that sued multiple defendants in order to seek recoveries on behalf of the U.S. government in exchange for a share of any such recoveries, allege that the packages for some of the defendants’ consumer products contained false representations that the products were subject to patent protection after the patents had expired.
Durable Medical Equipment False Claims Act Litigation
Dechert represented Wolk in a federal False Claims Act case alleging the it submitted false certificates of medical necessity in order to get reimbursed by federal health care programs for the cost of durable medical equipment. The case eventually settled. Reported decision: United States ex rel. Piacentile v. Wolk et al., 1995 WL 20833 (E.D. Pa. Jan. 17, 1995).
Federal False Claims Act Investigations
Dechert represents a major pharmaceutical manufacturer in federal government False Claims Act investigations of its sales, marketing and manufacturing practices, including issues relating to off-label promotion and alleged violations of the Anti-Kickback Statute. (Confidential Client).
Hospital System Government Investigation and Qui Tam Case
Dechert negotiated a successful settlement on behalf of a hospital system in connection with a government investigation and qui tam case relating to a partial hospitalization program operated by one of the member hospitals of the system. (Confidential Client).