Criminal Outcome Against Drug Maker Harsh, Civil Suit Even More So

Drug wholesaler AmerisourceBergen took a painful punch last year as the defendant in a federal criminal lawsuit. The company was slapped with a $260 million criminal fine after pleading guilty to fraud-related charges in litigation filed by the federal government.

It turns out that what was seemingly a painfully high exaction ended up as a relatively light slap on the proverbial wrist, when compared with what just transpired with the company in a related civil matter.

To wit: The U.S. Department of Justice announced last week that the drug maker is now on the hook for an additional $625 million. That ramped-up penalty is in response to the central role that AmerisourceBergen admitted it played in a massive and long-term health care fraud perpetrated on the public.

That scheme ran for many years. At its core, it involved what a recent Reuters article termed a subsidiary’s “distribution of pre-filled syringes that were not approved by the U.S. Food and Drug Administration.”

What that group pharmacy outlet did was to engage in the practice of “overfill.” That consisted of siphoning off amounts of excess medication from individual vials of drugs used in chemotherapy treatment. The extra product was then packaged and sold for use to Medicare cancer patients after being processed under unsterile conditions.

Government regulators also stated that AmerisourceBergen falsified Medicare billings and paid illegal kickbacks to physicians to buy the unhygienic drugs.

The government’s case proceeded under the U.S. False Claims Act, which spotlights fraudulent claims against federal agencies. Several whistleblowers were involved in the matter and collectively rewarded with nearly $100 million for the key role they played in exposing the wrongdoing.