Tag Archives: feds

Feds to start directly targeting drug company execs in health care fraud schemes

The days of drug companies simply settling out of court every time they break the law may soon be coming to an end. In a move that represents a significant shift toward punishing individuals for crimes rather than faceless corporations, federal officials say they will begin personally going after CEOs and other company executives whose companies fraudulently bilk Medicare, Medicaid, and other federal programs out of millions of dollars, or that falsely market dangerous drugs.

$1,000 a Pop: How Forest Labs Bribed Doctors to Prescribe Antidepressants to Kids

Forest Labs (FRX) appears to have initially underestimated how much it needed to pay the feds to go away: In 2009, the company said it had set aside $170 million in case it needed to settle a Department of Justice investigation of the kickbacks it paid in its marketing of Celexa and Lexapro, two antidepressants. Today, the company paid $313 million to wrap up the probes. Forest’s management is used to lavish spending, however, as the whistleblower complaints behind the settlement allege. The meat of Forest’s wrongdoing is that the company promoted Celexa for children even though the FDA had specifically rejected the drug for kids, and even though European data showed it was not useful in youths. The company did something similar with Lexapro — one pharmaceutical sales rep recommended crushing up Lexapro into apple sauce in order to make it more palatable to children.