Ohio gets $12M as part of Novartis Medicaid fraud settlement

Ohio will receive $12.5 million as part of a $422 million federal settlement with drug maker Novartis AG over allegations of improper marketing and illegal kickbacks to doctors.

Of Ohio’s get, $7.7 million will go to the federal government to reimburse its contribution to Ohio Medicaid payments, according to a statement from the office of Ohio Attorney General Richard Cordray.

The illegal “off-label” marketing accusations involved the anti-seizure drug Trileptal. Switzerland-based Novartis’ management directed its sales team to promote the drug for the treatment of conditions such as bipolar disorder and neuropathic pain, for which the drug had not been approved by the Food and Drug Administration, according to Cordray’s statement.

Additionally, federal investigators found that from 2002 to 2009, Novartis provided illegal kickbacks to persuade doctors to prescribe Trileptal and five other drugs. The kickbacks were often disguised as speaker fees to physicians.

The settlement follows four separate qui tam or “whistleblower” lawsuits brought by former Novartis employees.

“The company’s illegal business practices were snowballing, and nobody was stepping up to stop them,” said Jeremy Garrity, one of the whistleblowers. “I had to do something.” Garrity’s comments come from a statement from Nolan & Auerbach, a Florida law firm that represented three of the whistleblowers.

Earlier this year, Ohio received $4.4 million as part of a $72.5 million federal settlement with Novartis over off-label marketing of Tobramycin, a cystic fibrosis drug.