Sanofi is the latest pharmaceutical company to fall foul of the US Department of Justice and has reached a settlement over its promotion of the knee injection for arthritis product Hyalgan.
The French drugmaker's US subsidiary will pay $109 million to resolve allegations that, "facing pressure from a lower-priced competitor", the company provided its sales reps with thousands of free “sample” syringes of Hyalgan (sodium hyaluronate) and trained them to market the 'value-add' of these units to physicians. In practice, the DoJ alleges, Sanofi US reps often entered into illegal sampling arrangements with doctors, using the free units as kickbacks and promising to provide negotiated numbers of them in order to lower Hyalgan’s effective price.
The government alleges that Sanofi surreptitiously lowered the effective price of Hyalgan by promising the free units to doctors who agreed to purchase the product. It is therefore claimed that Medicare and other federal health care programmes paid millions of dollars "in kickback-tainted claims".
Whistleblower to pocket $18.5 million
The settlement resolves a lawsuit filed by former Sanofi sales rep Mark Giddarie under the qui tam, or whistleblower provisions, of the False Claims Act. He will receive $18.5 million as his share of the government’s recovery.
Sanofi noted that before the US government initiated the investigation that led to the settlement, it had identified concerns and "immediately took strong, proactive and effective steps to address these issues and voluntarily stopped sampling Hyalgan in 2009". The company expects to enter into a corporate integrity agreement with the Office of the Inspector General of the United States Department of Health and Human Services and noted that it will not face any criminal charges.