Japanese pharma co. pays US $39 mn for doctor kickbacks

Daiichi Sankyo, the large Japanese pharmaceutical company, has agreed to pay the United States $39 million over kickbacks it paid doctors to prescribe its drugs, the US Justice Department said Friday. Daiichi Sankyo Inc, the group's US subsidiary, will make the payment to the government and to state Medicaid programs to settle the allegations, first raised by a former company sales representative who provided evidence of the kickbacks. According to the Justice Department, the company's scheme involved inviting multiple physicians together to lavish dinners to speak on often identical topics, and paying them for the speeches. The doctors were expected to favor the company's drugs, the prescription of which could cost federal and state health care programs. "Drug companies are prohibited from using lavish entertainment and padded speaker-program payments to induce physicians to prescribe their drugs for beneficiaries of federal health care programs," said Carmen Ortiz, US Attorney for the District of Massachusetts, in the statement. "Settlements like this one show that the government will continue to pursue health care companies that use kickbacks to promote their products." The probe into the company's conduct began when the former sales representative, Kathy Fragoules, filed a complaint on behalf of the United States, as allowed under whistleblower provisions of the False Claims Act, which protects the government against fraud. Fragoules will earn a $6.1 million share from the Daiichi Sankyo payout.