U.S. Attorney Preet Bharara said the company used the "lure of kickbacks disguised as rebates" to turn 20 or more pharmacies into a sales force for its drug, Myfortic.
The other involves kickbacks in the form of rebates and discounts to at least 20 pharmacies in exchange for switching transplant patients from rival medicines to its Myfortic immunosuppressant treatment ( back story).
The government said Novartis offered one pharmacist in Los Angeles a "bonus" rebate amounting to several hundred thousand dollars to induce the pharmacist to "shoulder the burden" of switching 700 to 1, 000 transplant patients to Myfortic.
In its lawsuit, the government said Novartis had disguised kickbacks as performance rebates and discounts to convince pharmacies to switch patients to Myfortic from competitor's drugs and to oppose the use of a cheaper, generic immunosuppressant drug.
The suit on Myfortic is a significant expansion of the Anti-Kickback Statute that is inconsistent with law and policy in this area and the theory in this case threatens to undermine pharmaceutical company discounting practices that benefit both consumers and payers, including the government.