Qui Tam Settlement in Compounding Pharmaceutical Case
Rabin Kammerer Johnson announces the settlement of United States ex rel. Elvens Vertus v. Glades Drugs, Inc. Case No. 15-CV-81627, filed in the United States District Court for the Southern District of Florida.
The firm filed the case in 2015 on behalf of whistleblower client Elvens Vertus, a licensed pharmacy technician and former employee of the Defendant, Glades Drugs, Inc. The Defendant company is a pharmacy that, among other things, manufactures and sells compounded pharmaceuticals that are paid for by various federal and state healthcare programs.
Pharmacy compounding is a practice by which pharmacists combine, mix, or alter ingredients to create customized medications for individual patients. Compounded pharmaceuticals are very rare and are normally prescribed only in special circumstances, such as when a patient is allergic to normal medications, or when the patient needs specially tailored dosage strength.
Because compounded pharmaceuticals are tailor-made for each patient, they are very expensive. A single tube of compounded pain cream can fetch many thousands of dollars in reimbursement money from federal and state health care programs. Because of the high reimbursement rates, recent years have seen an explosion of fraud within the area of compounded pharmaceuticals.
Rabin Kammerer Johnson filed a lawsuit on behalf of Mr. Vertus alleging that Glades Drugs had an ongoing practice of paying kickbacks to patients in order to induce them to buy compounded pharmaceuticals.
The Government investigated Mr. Vertus’s qui tam lawsuit, chose to intervene in the suit, and reached a settlement with the Defendant. Under the terms of the settlement, Glades Drugs, Inc. will pay $300,000 to the United States. As a whistleblower reward, the Government agreed to pay Mr. Vertus 23% of the proceeds, or $69,000.
The False Claims Act authorizes private whistleblowers to bring lawsuits on behalf of the Government to recover money lost due to fraud. Rabin Kammerer Johnson is proud to bring cases like this one and to recover funds defrauded from the United States.