On November 1, the Department of Justice (DOJ) announced that Doug McMakin, a pharmacist who brought claims against Medisca Inc., is set to receive $3,425,625 from a settlement under the qui tam provisions of the False Claims Act (FCA). Medisca agreed to pay $21.75 million to resolve allegations of establishing false Average Wholesale Prices (AWPs) for ingredients used in compound prescriptions.
The DOJ alleges that Medisca’s pricing scheme caused pharmacies that purchased those ingredients to submit inflated prescription claims to the Defense Health Agency, allowing them to fraudulently bill federal healthcare programs often thousands of dollars per prescription. McMakin is a pharmacist who owned and operated a compounding pharmacy that dispensed compounded prescriptions.
“We will not tolerate fraudulent pricing schemes targeting health care programs that support veterans and other federal beneficiaries,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “As today’s settlement demonstrates, we will hold accountable not just those who submit false claims, but all who participate in schemes designed to defraud the American taxpayers.”
With the new enforcement, the DOJ emphasized their priorities of combating healthcare fraud, and the importance of whistleblowers using the FCA in the effort against fraud. Under the False Claims Act’s qui tam provisions, individuals may 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.
In July 2023, a bipartisan group of senators introduced the False Claims Amendments Act of 2023, which address a few technical loopholes undermining the success of the FCA. The bill is widely supported by whistleblower advocates.
National Whistleblower Center (NWC) has issued an Action Alert calling on Congress to pass the bill.
Join NWC in Taking Action:
Demand that Congress strengthen the False Claims Act
Further Reading:
Bipartisan Legislation Unveiled to Strengthen False Claims Act
