A pharmaceutical company has agreed to pay a settlement in a whistleblower lawsuit brought by a Milwaukee firm.
Forest Laboratories will pay $38 million to settle a federal lawsuit in the Eastern District of Wisconsin alleging the company had violated the False Claims Act by paying kickbacks to doctors in exchange for prescriptions they wrote for three of the company’s drugs.
Milwaukee-based Cross Law Firm brought the lawsuit in 2012 on behalf of Kirk Kroening, who was then a sales representative for Forest, according to a news release.
Among other things, the lawsuit alleges that the amounts that Forest paid for doctors’ meals and speaking events was directly related to how many prescriptions they wrote. It alleges that the compensation occurred even when the events did not take place.
The U.S. Attorney’s Office in the Eastern District of Wisconsin worked on the case for several years and announced the settlement Thursday.
Kroening will receive about $7.8 million from the settlement. The federal government will receive $35.5 million, and state Medicaid programs will get $3.5 million. The False Claims Act lets private citizens sue private citizens or businesses for defrauding the government and then share in any recovered money.
The federal law rewards whistleblowers if their lawsuits are successful.
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