Keys whistleblowers awarded $88 Million

The small Key West whistleblowing firm Ven-A-Care of the Florida Keys stands to get its biggest windfall yet -- $88.4 million -- now that three pharmaceutical firms have agreed to pay $421.2 million to settle allegations of Medicaid and Medicare fraud.

The U.S. Justice Department said Tuesday that Abbott Laboratories Inc., B. Braun Medical Inc., Roxane Laboratories Inc. and affiliated entities will pay to settle False Claims Act allegations filed by Ven-A-Care, owned by Mark Jones, Luis Cobo and John Lockwood.

The small, under-the-radar Ven-A-Care opened in 1987 on Duck Avenue to provide home infusion therapy to HIV-positive patients and elderly residents with kidney failure. This year, it moved its operation to Duval Street.

Over the years, it has collected tens of millions of dollars for blowing the whistle on drug firms that defraud Medicare and Medicaid.

In the cases against Abbott, Braun and Roxane, "the defendants engaged in a scheme to report false and inflated prices for numerous pharmaceutical products knowing that federal health-care programs relied on those reported prices to set payment rates. The actual sales prices for the products were far less than what defendants reported," the Justice Department said.

Roxane is paying $280 million to resolve claims against it and related entities for reporting false prices for Azathioprine, Diclofenac Sodium, Furosemide, Hydromorphone, Ipratropium Bromide, Oramorph SR, Roxanol, Roxicodone and Sodium Polystyrene Sulfonate.

Abbott is paying $126.5 million with respect to its pricing of dextrose solutions, sodium chloride solutions, sterile water and Vancomycin.

Braun agreed to $14.75 million to resolve allegations it caused the Medicaid program to pay inflated amounts for 49 of its drug products.

The fraud "came to light thanks to an alert South Florida whistleblower," said Wilfredo Ferrer, U.S. attorney for South Florida. "As a result, hundreds of millions of dollars that were being siphoned off have now been recovered and will be used to provide services as intended -- to the sick and elderly who need them."

The False Claims Act allows private people or firms to file lawsuits to provide the government information about wrongdoing. If the government is successful in resolving or litigating the claims, the whistleblower that initiated the action can receive between 15 percent and 25 percent of the amount recovered.

That's how Ven-A-Care is getting $88.4 million from the Abbott, Braun and Roxane cases.

Last December, Ven-A-Care collected $1.35 million for blowing the whistle in another Roxane case. And in October 2009, Ven-A-Care learned it would receive $10.8 million for helping state and federal lawyers win a $124 million settlement from four pharmaceutical companies in a national case over mislabeled prescription drugs.

There were other cases, as well, including in 1991, when Jones, Cobo and Lockwood spurned a buyout offer from National Medical Care.

According to Taxpayers Against Fraud, a nonprofit group based in Washington, D.C., National Medical then launched a campaign to force Ven-A-Care out of business.

But in fighting back, Ven-A-Care staff discovered National Medical was paying kickbacks to doctors who prescribed medicines and services that weren't needed, then billing Medicare and Medicaid exorbitant sums far in excess of what the medicines and services cost.

The Justice Department eventually got a $486 million settlement from National Medical -- and Ven-A-Care received $40 million as its reward under the False Claims Act.

Taxpayers Against Fraud named Ven-A-Care its Whistleblower of the Year in 2006.

Last year, its communications director, Patrick Burns, told the Keynoter: "The truth is, these guys should win it every year. What they have done is truly inspirational. They have changed the way the health-care industry does business, and prevented billions and billions of fraud against the Medicare and Medicaid programs that we all pay for."

via keysnet.com

Posted via email from Jack's posterous