That’s the take of Brian Kenney of Kenney Egan in Philadelphia.
Kenney last week settled part of the massive $2.3 billion False Claims Act case against Pfizer for off-label promotion of its drugs. Kenney represented Harrisburg psychiatrist, Dr. Stefan Kruszewski.
Kruszewski blew the whistle on off-label marketing of Pfizer’s drug Geodon – used to treat schizophrenia.
The Geodon portion of the case settled for $301 million – with the relator’s share being $29 million. Kruszewski will share that amount with a second whistleblower.
“That’s why you are seeing the settlements becoming larger and larger,” Kenney told Corporate Crime Reporter last week. “Historically, the FDA just did not aggressively enforce their off-label marketing regulations. And now the Department of Justice and the U.S. Attorneys in Boston and Philadelphia are using the False Claims Act. These companies are taking bigger and bigger penalties. And the government is hoping that at some point the deterrent value will sink in. But I don’t know what that point is.”
Pfizer keeps getting into trouble with the Justice Department in False Claims cases. Where’s the deterrent impact?
“The deterrent impact hasn’t been there to date,” Kenney said. “But the government is becoming ever more aggressive. At some point the deterrent impact will sink in.”
“There have been criminal prosecutions of individuals. That has the potential to have a tremendous impact. And there have been some prosecutions, but some have resulted in acquittals.”
“The guy at Pfizer who says – I have good news to show you have that Geodon should only be a $200 million drug, not a $1 billion drug – and we’ll be complying with the FDA regs – that guy in all likelihood is going to be looking for a job.”
With more and more health care fraud cases hammering the staffs at the U.S. Attorney’s offices in Boston and Philadelphia, other offices will begin to step up, Kenney predicted.
“You will see it expand beyond Boston and Philadelphia now,” Kenney said. “Those offices are so busy, that other U.S. Attorney’s offices are being somewhat more aggressive. You are seeing Brooklyn, Los Angeles and Chicago becoming more involved in these national health care cases.”
Did the change in administration have anything to do with the announcement of the record Pfizer settlement last week?
“I would say absolutely not,” Kenney said. “We saw the lawyers on the ground – relator’s counsel and the assistant U.S. Attorneys – Marilyn May, Charlene Fulmer and Sarah Bloom – they were completely unaffected by the change in administration. I suppose anything is possible. But we saw them working diligently all along to resolve these cases.”
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