Novartis Finalizes Settlement of Speaker Program Litigation in U.S.--Update

By Stephen Nakrosis 

Novartis AG on Wednesday said it completed an agreement with the U.S. Attorney's Office for the Southern District of New York, the New York State Attorney General and relator Oswald Bilotta, which will see it pay a $678 million settlement to resolve "a civil suit challenging speaker programs and other promotional events conducted from 2002 through 2011 by Novartis Pharmaceuticals Corp."

As part of the settlement, Novartis said, it "agreed to new corporate integrity obligations with the Office of Inspector General of the U.S. Department of Health & Human Services that will change how the company delivers peer-to-peer programs in the U.S."

Vas Narasimhan, the company's chief executive, said "Today's settlements are consistent with Novartis commitment to resolve and learn from legacy compliance matters."

The company said it fully provisioned for this settlement in July of last year.

The U.S. alleged Novartis hosted tens of thousands of speaker programs and related events "under the guise of providing educational content, when in fact the events served as nothing more than a means to provide bribes to doctors," the Justice Department said in a statement late Wednesday.

Novartis paid physicians, purportedly as compensation for delivering lectures regarding a Novartis drug, the Justice Department said. But many of the programs were nothing more than social events held at expensive restaurants, with little or no talk about the Novartis medication, prosecutors said. Some of the so-called speaker events never even took place, prosecutors said.

"Giving these cash payments and other lavish goodies interferes with the duty of doctors to choose the best treatment for their patients and increase drug costs for everyone," Acting U.S. Attorney Audrey Strauss for the Southern District of New York said in a statement. "This office will continue to be vigilant in cracking down on kickbacks, however they may be dressed up, throughout the pharmaceutical industry."

Also on Thursday, Novartis said it completed a previously disclosed agreement with the U.S. Department of Justice and the U.S. attorney's office for the District of Massachusetts, which will see it pay $51.25 million "to resolve an investigation related to the company's support of certain independent charitable copay foundations from 2010 to 2014."

Under the terms of this settlement, the company said, it "agreed to additional corporate integrity obligations with OIG to further enhance its controls relating to its interactions with ICCFs."

Novartis said it had provisioned for this settlement.

Jack Hagel contributed to this article.

Write to Stephen Nakrosis at [e-mail]

(END) Dow Jones Newswires

July 01, 2020 21:23 ET (01:23 GMT)

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