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Biogen IncBIIB has reached a $900 million settlement with a whistleblower who accused the firm of paying doctors bribes to encourage them to prescribe its multiple sclerosis drugs.
The whistleblower behind the report, Michael Bawduniak, will receive about $250 million directly, according to a statement released Monday by the U.S. Justice Department.
About $843 million will essentially go to the federal government and a smaller part-$56 million to 15 American states that had joined the lawsuit.
Bawduniak, a former marketing executive at Biogen, took legal action using the False Claims Act, which authorizes a private citizen to sue in civil cases on behalf of the U.S. government if it appears that an individual or a legal entity has financially cheated the state.
In his lawsuit filed in the District of Massachusetts, Bawduniak alleged that Biogen paid kickbacks to physicians to induce them to prescribe the company’s multiple sclerosis drugs.
The case relates to a period from 2009 to 2014.
Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Department of Justice’s Civil Division, said, “The settlement announced today underscores the critical role that whistleblowers and their attorneys play in utilizing the False Claims Act to combat fraud affecting federal healthcare programs.”
Price Action: BIIB shares closed lower by 1.03% at $195.75 on Monday.
