In late September 2017, drug wholesaler AmerisourceBergen Corp. (ASBG) pleaded guilty in federal court in Brooklyn to violations of the federal Food, Drug and Cosmetic Act in the sale of misbranded oncology drugs. The guilty plea included a settlement of $260 million—$208 million in fines and $52 million in criminal forfeiture. ASBG also signed on for a three-year supervised compliance and ethics program. We discussed the details of the criminal case and settlement in a client alert (click HERE to read the full alert).
It has now come to light due to ASBG’s most recent earnings report that the company has also earmarked $575 million to resolve civil claims for the same allegations under the False Claims Act.
Per the report, “With regard to the civil investigation involving the prefilled syringe program [at] Medical Initiatives Inc., which was the subject of a one-count strict-liability misdemeanor guilty plea by Amerisource Bergen Specialty Group on Sept. 27, 2017, the company has accrued a $575 million reserve. The company is in advanced settlement discussions with the United States Attorney’s Office for the Eastern District of New York and the Department of Justice, which are ongoing.”
Should ASBG and the U.S. Attorney reach a settlement anywhere near the amount of the reserve, it would represent one of the largest FCA settlements in history.