The U.S.-based division of one of the world's largest drug firms this week paid more than $190 million to settle allegations that it violated the False Claims Act.
Sanofi-aventis US Inc., a subsidiary of Paris-based Sanofi-aventis Group, paid settlements to the federal government, several states and the District of Columbia as a result of lawsuits regarding the average wholesale price of its Anzemet drug.
Investigators found that Sanofi-aventis' predecessor, Aventis Pharmaceuticals Inc., created illegal discrepancies between the prices the company charged to its customers and the rates at which it was reimbursed by the federal government.
The difference between these rates, known as the "spread," is pivotal in determining the reimbursements providers receive as returns on investments for drug purchases. Federal payers, such as Medicare and Medicaid, benchmark their reimbursement rates for drugs based on the prices pharmaceutical companies charge to providers.
The Office of the Inspector General believes Sanofi-aventis inflated their spread in an effort to market, promote and sell its Anzemet drug to existing and potential customers.
"Fraudulent drug pricing and marketing schemes divert scarce Medicare and Medicaid resources away from patient care," Daniel R. Levinson, inspector general for the U.S. Department of Health and Human Services, said in a press release. "One of OIG's top priorities is to root out pharmaceutical fraud and hold companies liable for their actions."
Sanofi-aventis noted in a release that the activity under question occurred between Sept. 1, 1997, and June 30, 2004, prior to the formation of Sanofi-aventis. "The Group has decided to resolve this legacy matter through this settlement, without admitting any wrongdoing," the release indicated.
Employees of Ven-A-Care, a division of home-infusion firm Florida Keys Inc., filed the suit against Sanofi-aventis under the whistleblower act. The employees stand to receive a $32 million share of the total settlement.
The federal government will receive roughly $180 million of the total settlement. The remaining $10 million will be distributed to states seeking reparation for their Medicaid programs' overpayments for Anzemet.
Sanofi-aventis US also has agreed to engage in a five-year corporate integrity agreement with the OIG and HHS.