Astellas to Settle False Claims for $7.3M; Whistleblower to get $709K

Illinois-based Astellas Pharma has agreed to pay $7.3 million to resolve allegations that the company knowingly submitted or caused the submission of false claims in connection with the drug Mycamine, the U.S. Department of Justice announced last week.

The settlement resolves allegations that Astellas knowingly marketed and promoted the sale of Mycamine for pediatric use, which was not a medically accepted indication and, therefore, not covered by federal health care programs.  During this time period, the FDA approved Mycamine to treat adult patients suffering from serious and invasive infections caused by the fungus Candida, including infections in the esophagus, the blood and the abdomen, and to prevent Candida infections in adults undergoing stem cell transplants.  From 2005 through June 2013, however, Mycamine was not approved to treat pediatric patients for any use.       

As a result of the $7.3 million settlement, the federal government will receive $4.2 million, and state Medicaid programs will receive $3.1 million. 

The lawsuit was originally filed by Frank Smith, a former Astellas sales representative, under the whistleblower provisions of the False Claims Act.  The Act allows private parties with knowledge of fraud against the government to sue on behalf of the government and share in the recovery.  Smith will receive $708,852 as his portion of the settlement.

The Chanler Group, in association with the Hirst Law Group, represents whistleblowers who take action under the False Claims Act to report fraud committed against the federal and state governments.  We have years of experience representing whistleblower clients who expose every kind of fraud against the government, including health care fraud, contract fraud, and tax fraud.  Read more about our expertise in False Claims Act cases and how you can take action.