On January 23, the Department of Justice (DOJ) announced that Liberator Holdings and Rochester Medical Corporation agreed to pay $17 million to resolve allegations of violation of the False Claims Act. The government alleges that they violated the False Claims Act by “providing free samples and discounts to encourage urology practice groups to use Bard’s prescription form for prescribing intermittent catheters for their patients.”
According to the Department of Justice “between 2016 and February 2020, the Liberator Defendants provided discounts, excessive free samples, and cost savings for in-office supplies to urology practice groups to persuade those practices to use Bard’s own ‘Link .'”
These allegations are violations of the Anti-Kickback Statute.
“The use of inducements to influence a physician’s medical decisions undermines the important physician-patient relationship and interferes with the goal of doing what is best for the patient,” said Acting U.S. Attorney Richard S. Moultrie, Jr. “Our office will coordinate with our federal and state partners to hold accountable those companies who violate federal law for financial gain.”
This case stems from a whistleblower, Dirk Etheridge a former employees of the 180 Medical, who filed a suit under the False Claim Act’s qui tam provision which allows a private citizens to file lawsuits alleging government contracting fraud on behalf of the United States. In successful qui tam cases, whistleblowers are eligible to receive between 15 and 30% of the settlement or judgment. In this case, the realtor, Dirk Etheridge, will receive a share of the $17 million from the settlement.
During the 2024 fiscal year, False Claims Act recoveries exceeded $2.9 billion with over $2.4 billion of the recoveries stemming from qui tam whistleblower lawsuits. Furthermore, according to the government, a record 979 qui tam lawsuits were filed in FY 2024. Over $1.67 billion of the recoveries related to matters that involved the healthcare industry including managed care providers, hospitals and other medical facilities, pharmacies, and pharmaceutical companies.
However, in September 2024, a district judge in Florida ruled that the False Claims Act’s qui tam provisions were unconstitutional. In response, the federal government is urging the U.S. Court of Appeals for the Eleventh Circuit to reverse that decision, stating in a brief that “other than the district court here, every court to have addressed the constitutionality of the False Claims Act’s qui tam provisions has upheld them.”
National Whistleblower Center has issued an Action Alert allowing whistleblower supporters to write the members of Congress urging them to protect and strengthen and protect the False Claims Act.
The claims asserted in this case are allegations only, and there has been no determination of liability.
Join NWC in Taking Action:
Strengthen the False Claims Act and Protect it From Attack
Further Reading:
C.R. Bard, Inc. and Affiliates Pay $17 Million to Resolve Allegations of Healthcare Kickbacks