HomeFAQsQui Tam / False ClaimsReporting Off-Label Drug Marketing

Reporting Off-Label Drug Marketing

Illegal Drug Marketing

A qui tam action filed under the False Claims Act is the method to report off-label drug marketing. Qui tam lawsuits are filed by an attorney, in camera, or under “seal.” The contents of the action are kept confidential under seal until the court lifts it. The court does not serve the complaint on the defendant and can dismiss the complaint if a whistleblower violates any part of the seal.

If you plan on reporting off-label drug marketing, we suggest hiring a False Claims Act attorney. You have the opportunity of possibly saving thousands of lives and billions in taxpayer dollars going to Medicaid fraudsters engaging in such activities as off-label drug marketing.

Whistleblower rewards are also available, and the amounts for reporting these types of fraud have been some of the largest in history. Since 1986, when Congress improved the FCA, awards total more than $62 billion.

Continue reading to learn how to spot off-label drug marketing and the laws that protect and reward you for coming forward with information.

Key Takeaways

  • The False Claims Act allows US and non-US citizens to file lawsuits against a fraudster on behalf of the US Government.
  • Whistleblowers must hire an attorney to file a False Claims Act lawsuit.
  • Whistleblowers may receive between 15 and 30 percent of the sanctions collected from a fraudster – percentages depend on the detail and credibility of the evidence.

What is Off-Label Drug Marketing?

Off-label drug marketing, also known as off-label promotion, is the illegal practice of advertising drugs or medical devices for purposes not approved by the FDA. For example, if a drug is approved to treat anxiety and the pharmaceutical representative promotes it as a sleep aid. That promotion would be illegal.

The idea behind the fraud is that by marketing drugs for unapproved purposes, manufacturers can force pharmacies to claim Medicaid payments for the drugs when Medicaid does not cover them.

This type of marketing is illegal and widely unaccepted within the medical community, as many believe it negatively impacts quality care and puts patients at risk. Whistleblowers who know of drugs promoted for unapproved uses can report this illegal activity and may qualify for rewards under the False Claims Act qui tam provisions.

How to Spot Off-Label Drug Marketing

One way a company might commit fraud is by paying incentives (e.g., bribes) to sales representatives for their sales for off-label use. Another way is sales representatives paying kickbacks to physicians to prescribe drugs for off-label use. They may also supply them with misleading or “false” off-label promotional material to disperse to their patients.

Pharmaceutical companies may also pay physicians to claim authorship of articles or give lectures about off-label use. They may instruct other physicians how to code claims and medical records to ensure payment for off-label uses not covered by Medicaid.

If you’ve witnessed any of the above mentioned scenarios, please get in touch with a whistleblower attorney today to learn about your rights and protections under the False Claims Act.

Reporting Medicaid Fraud Using the False Claims Act Qui Tam Provision

Abraham Lincoln enacted the False Claims Act (“FCA”) during the American Civil War to prevent contractors from defrauding the US Government. The FCA allows ordinary citizens to file lawsuits on behalf of the US government.

Within the False Claims Act is a provision called qui tam. A qui tam lawsuit protects taxpayers and rewards whistleblowers who report fraud to the US Government. It also allows the government to recover funds lost due to fraud.

The reward amounts can be between 15 and 30 percent of the sanctions collected from a company. The percentage awarded is determined by the level of evidence provided to the US Government. Both foreign nationals and US citizens are eligible to report Medicaid fraud under the False Claims Act qui tam provisions. Please read our guide on filing a qui tam lawsuit to learn more.

Reporting Off-Label Drug Promotion Using Other U.S. Laws

Depending on the level of fraud committed and the international scope of the scam, you may be eligible for other rewards covered under the Foreign Corrupt Practices Act (“FCPA”).

The FCPA is enforced by the Department of Justice, the Securities and Exchange Commission, and the Commodities Futures Trading Commission and deals with illegal financial transactions, including bribery or market manipulation.

For example, Novartis Greece conspired with others to violate the FCPA by engaging in a scheme to bribe employees of state-owned and state-controlled hospitals and clinics to increase the sale of Novartis-branded pharmaceutical products.

Novartis was required to pay over $300 million in sanctions and fines to the US Securities and Exchange Commission (SEC) and the US Department of Justice (DOJ).

Latest from The Blog

  • December 6, 2022

    On December 6, the U.S. Supreme Court heard arguments in United States, ex rel. Polansky v. Executive Health Resources, Inc. The case concerns the issue of whether or not the U.S. government can dismiss False Claim Act whistleblowers' qui tam suits after initially declining to intervene in them. According to whistleblower attorneys, the case has tremendous implications ...

  • July 29, 2022

    A major False Claims Act (FCA) qui tam case is heading to trial that pits a large defense department contractor, OST, Inc., and its sole owner, Vijay Narula, against a lone whistleblower, Andrew Scollick.  Scollick blew the whistle to the government alleging that $7 million in construction contracts that were supposed to be awarded ...

  • June 22, 2022

    This article was originally published in JD Supra. On June 21, the U.S. Supreme Court granted certiorari in United States, ex rel. Polansky v. Executive Health Resources, Inc. The Court agreed to hear the case which concerns the issue of whether or not the U.S. government can dismiss False Claim Act whistleblowers' qui tam suits after initially ...

Frequently Asked Questions

By law, reporting off-label marketing (a violation of the False Claims Act) requires an attorney who understands the intricacies of the False Claims Act and filing qui tam lawsuits. If the government doesn’t decide to intervene, whistleblowers may proceed on their own. Cases in which the government intervenes obtain a recovery 95% of the time. Contrastingly, that percentage drops drastically in cases where the government does not choose to intervene.

Anyone with strong and credible evidence of their off-label marketing can file a claim and become a whistleblower.

Manufacturers and medical device companies marketing their products for off-label use could also violate the False Claims Act.

The False Claims Act also provides for damages for whistleblowers who suffer employment retaliation. Under section 3730 (h) of the False Claims Act, relief may include reinstatement with seniority, double back pay plus interest, and any other damages sustained due to the discrimination, including reasonable litigation costs and attorney’s fees.