Although Millennium Escaped This Integrilin® Suit, Schering-Plough (And Thus, Merck) Will Need To Develop Factual Defenses, To Escape

That said, I suspect that Merck — as successor to Schering-Plough — (in California’s federal Eastern District Court, before the very able Judge England) will eventually be able to show that the complaining party here, one Frank Solis, was not “the original source” of the allegations of kickbacks and overbilling, related to sales of Integrilin®, from 2002 to 2009. [Backgrounders here, and here.]

In order for the federal courts to have jurisdiction over these claims, the amended False Claims Act (circa 2006) requires that the complaining person be the original (non-public) source of the claims. So, even after Mr. Solis proves every word below is true, he will also have to establish that he was the original source of the proof/information. And it seems that most of these same sorts of allegations were made in an earlier-filed South Carolina state court proceeding against Schering-Plough, called Bentley. [Merck wasn’t a party in Bentley in South Carolina, because Merck did not yet own Schering-Plough, when the suit was brought (also circa 2006). But. . . this is how Millennium escaped this suit — by proving a prior public source, for the Solis allegations.] After some discovery, Merck may well be able to escape as well.

In any event, here is Merck’s latest filing (as a PDF file) as of this past Friday afternoon, asking for a reconsideration (essentially asking to be dismissed from the suit). And I’ll quote from the published opinion of Judge England (also a PDF file), denying that request:

. . . .[Schering-Plough salesman Frank Solis] describes, in detail, [Schering-Plough’s] alleged actions between 2002 and 2009 to convince physicians to write prescriptions of Integrilin for off-label uses. Those purported “kickback” activities included funding grants, paying excessive speaker fees, providing honoraria, furnishing meals, paying for attendance at Continuing Medical Education (“CME”) seminars while retaining control of virtually every aspect of the events so as justify off-label use and funding preceptorships and advisory boards. . . .

According to [Solis], [Schering-Plough’s] sales representatives were also instructed to send “invitations to lavish meals exclusively to targeted high volume prescribers or referral sources.” In light of all these activities, [Solis] alleges that the submissions of prescriptions for reimbursement were false because [Schering-Plough’s] illegal activities had influenced them. Again, while [Merck, Millennium and Schering-Plough] deny these allegations and claim [Solis] has shown no excessive remuneration that would run afoul of the [law], the facts. . . as alleged by [Solis] must be deemed true for purposes of ruling on a motion to dismiss. . . .

[Solis] need only show that [Schering-Plough’s] alleged illegal promotional activity was a “substantial factor” in the submitting of false claims. To state a viable False Claims Act case, [Solis] simply has to show that “one purpose” of the kickbacks is to induce prescriptions –- it need not be the only purpose of the kickbacks. U.S. v. McClatchey, 217 F.3d 823, 835 (10th Cir. 2000). . . .

So while it remains completely unclear whether Merck will ever get stuck with more damages, on Fred Hassan’s skunky, skanky bar bill here — since Mr. Solis may turn out not to be the original source of the allegations, it deserves mention that Mr. Solis has significant evidence that the complained-of conduct did in fact occur. Do be assured, this mess goes on Fast Fred’s bar tab — ultimately, in my book — as a matter of Karma, at least. But what do I know? — that’s just one guy’s opinion. Have a great week — coverage here will be spotty later in the week. Out of pocket and off the grid.

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