On May 4, the U.S. Department of Justice (DOJ) announced that pharmaceutical company Incyte Corporation has agreed to pay $12.6 million to resolve allegations that it violated the False Claims Act. The whistleblower in the case will receive $3.59 million for his qui tam lawsuit containing the allegations that this settlement will resolve.
The settlement resolves allegations that from November 2011 through December 2014, Incyte “purportedly used an independent foundation as a conduit to pay the copays of certain federal beneficiaries taking Incyte’s drug Jakafi, which was approved to treat [myelofibrosis] in 2011.” According to the press release, Incyte “was the sole donor to a fund that was opened in November 2011 to assist only [myelofibrosis] patients.” The DOJ alleges that Incyte used the fund to finance copays of “federal beneficiaries” who were taking Jakafi but “ineligible for assistance from the fund because they did not have [myelofibrosis].” According to the press release, “Incyte managers pressured the foundation, through phone calls and emails, to provide economic assistance to these ineligible patients, and Incyte’s contractor helped ineligible patients to complete applications submitted to the fund for assistance.” Allegedly, this caused the submission of false claims to Medicare and TRICARE for Jakafi.
A whistleblower, Justin Dillon, was responsible for bringing the claims against Incyte that are being resolved in this case. Dillon, who formerly worked as a compliance executive for Incyte, filed a qui tam lawsuit alleging Incyte’s wrongdoing. The qui tam provisions of the False Claims Act enable individuals to file lawsuits regarding fraud on behalf of the government. Qui tam whistleblowers will then be able to receive 15 to 30 percent of the amount that the government is able to recover. In this case, Dillon will receive $3.59 million as his share of the government’s recovery.
“Drug companies undermine the integrity of federal health care programs and contribute to rising drug costs when they illegally use foundations to cover patients’ costs for their own drugs,” said Acting Assistant Attorney General Brian M. Boynton of the Justice Department’s Civil Division. “This resolution reflects the government’s continuing commitment to hold pharmaceutical companies accountable for this conduct.”
“Protecting TRICARE, the health care system for U.S. military members and their dependents, is a top priority for the Defense Criminal Investigative Service (DCIS),” said Special Agent in Charge Patrick J. Hegarty of the DCIS Northeast Field Office. “Submitting false claims for ineligible patients compromises the integrity of the TRICARE program. Today’s settlement is the result of a joint effort with the U.S. Attorney’s Office, DOJ Civil Frauds, and HHS-OIG, and it demonstrates our ongoing commitment to work with our law enforcement partners to investigate those who engage in health care fraud.”
Qui tam whistleblowers like Dillon are extremely effective at bringing cases of healthcare fraud to court, and his whistleblower reward reinforces a strong message that whistleblowers in the healthcare field are vital to uncovering wrongdoing. The DOJ reported that in 2020, more than $2.2 billion was recovered “in settlements and judgments from civil cases involving fraud and false claims.” Additionally, in 2020, “[w]histleblowers filed 672 qui tam suits in fiscal year 2020, and this past year the department recovered over $1.6 billion in these and earlier-filed suits.” The Incyte case is yet another example of how important whistleblowers are in exposing wrongdoing and preserving the integrity of government programs.
Read the DOJ’s press release here.