India Drug Company Settles Massive False Claims Act Case

162017_132140396847214_292624_nA large generic drug manufacturer based in India has agreed to settle a False Claims Act lawsuit by paying $350 million to resolve federal and state claims plus $150 million in criminal penalties. The federal lawsuit had alleged that Ranbaxy Laboratories Limited (“Ranbaxy”) had violated safety laws, reporting laws, and FDA regulations regarding its manufacture and sale of pharmaceuticals. The federal lawsuit had been filed in the U.S. District Court for the District of Maryland.

The allegations against the Indian drug company came to light as a result of the efforts of a whistleblower, who will receive about $48.6 million as his share of the recovery, pursuant to the provisions of the False Claims Act. The pharmaceutical company agreed to plead guilty to three criminal counts that it violated the Federal Food, Drug, and Cosmetics Act and an additional four criminal counts of making false claims to the FDA, all of which are felonies.

The alleged False Claims Act violations occurred between April 1, 2003 and September 16, 2010 when the manufacturing, distributing, and selling of the company’s drugs failed to comply with FDA-approved formulations as to strength, purity, or quality, thereby resulting in false claims being submitted to Medicare, Medicaid, and other federal health plans. Those drugs included the epilepsy drug gabapentin, the antibiotic ciprofloxacin (“cipro”), and sotret, which is used to treat severe nodular acne.

The Indian drug company also admitted that it made false statements to the FDA in both 2006 and 2007 regarding tests on certain drugs that were required to be performed months apart even though the company conducted those tests within days of each other, which resulted in unreliable expiration dates for those drugs, as well as storing drugs in a refrigerator that failed to meet FDA-approved temperature and humidity ranges for unknown periods of time.

The CEO of Ranbaxy issued a statement regarding the settlement in which he stated, “We are pleased to continue bringing safe, effective and quality medicines to market for the benefit of consumers in the U.S. and other parts of the world. While we are disappointed by the conduct of the past that led to this investigation, we strongly believe that settlement of this matter now is in the best interest of all Ranbaxy’s stakeholders; the conclusion of the investigation does not materially impact our current financial situation or performance.”

Source: The Daily Record, May 14, 2013.

Two major concerns jumped out at us while reading about the Ranbaxy settlement of these very serious civil and criminal allegations involving the safety of drugs imported into the United States: first, how safe is our supply of drugs coming from overseas if we must rely upon foreign pharmaceutical companies to self-report that they are complying in full with all of the safety requirements imposed by the FDA, without constant on-site FDA monitoring? Second, how much of an incentive is there for foreign drug manufacturers to comply with U.S. drug safety laws and regulations if,  when they get caught violating those laws and regulations, the financial resolution of the claims against them “does not materially impact our current financial situation or performance”?

Why is our government allowing foreign pharmaceutical companies to gamble with the safety and well-being of our families? What is our federal government planning to do to immediately eliminate our exposure to potentially bad drugs coming from foreign manufacturing, storing, and/or distributing facilities? What will it take before our government reacts seriously and effectively to this potential deadly crisis — mass deaths or other catastrophic harms to people in the U.S. due to defective foreign drugs being complacently supplied to our local pharmacies and health care providers’ offices that are then dispensed to our children and ourselves?

If you or a family member may have been harmed due to a defective drug, you or your family member may be entitled to compensation for your injuries and other harms.

Click here to visit our website to be connected with medical malpractice lawyers in your state who handle defective drug claims and may be able to assist you with your defective drug/bad drug claim, or call us toll-free at 800-295-3959.

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This entry was posted on Sunday, December 1st, 2013 at 9:56 am. Both comments and pings are currently closed.

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