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United States of America, et al., Ex Rel. Joseph v. Sanofi Synthelabo

December 31, 2010

UNITED STATES OF AMERICA, ET AL., EX REL. JOSEPH PIACENTILE, PLAINTIFF,
v.
SANOFI SYNTHELABO, INC. AND AVENTIS PHARMACEUTICALS, INC., DEFENDANTS.



The opinion of the court was delivered by: Katharine S. Hayden, U.S.D.J.

NOT FOR PUBLICATION

OPINION

I. Introduction and Statement of Facts

Joseph Piacentile (―Piacentile‖), the plaintiff in this action, brings claims under the federal False Claims Act (―FCA‖), as well as numerous state false claims acts. Underlying his claims are three related courses of conduct by the defendants, Aventis Pharmaceuticals, Inc. (―Aventis‖) and Sanofi Synthelabo, Inc. (―Sanofi‖), to increase their profits and market share, allegedly through improper means. The defendants move to dismiss Piacentile's Second Amended Complaint [D.E. 35].

For the purposes of deciding the motion, all of the facts alleged in the complaint and all reasonable inferences that can be drawn therefrom are accepted as true. See Great W. Mining & Mineral Co. v. Fox Rothschild LLP, 615 F.3d 159, 161 (3d Cir. 2010).

A. Aventis' Off-Label Marketing

Aventis is a pharmaceutical manufacturer based in New Jersey whose products include Taxotere, a cancer drug. (Second Am. Compl. ¶¶ 21--22, 54.) Before May 2004, Taxotere was only approved for treating advanced forms of breast and lung cancer. (Id. ¶ 54.) On May 19, the drug was approved for treating advanced prostate cancer, and on August 19, 2004, it was approved for treatment of operable, early stage breast cancer. (Id. ¶ 55.) Despite the fact that Taxotere's approved uses were limited, Aventis's sales force promoted to doctors so-called off-label uses of the drug-uses the FDA had not approved. Former Aventis sales representatives told Piacentile that Aventis employed 30 managers whose sole purpose was to promote off-label uses of Aventis drugs. (Id. ¶¶ 64--65.) Once an Aventis drug is approved for a previously off-label use, the salespeople move on to promote another off-label use. (Id. ¶ 67.)

Aventis sponsored educational conferences to discuss off-label uses, and they invited high-prescribing physicians to these events. (Id. ¶¶ 61--62.) Though the conferences were purportedly educational, they were in actuality commercial promotional events which physicians are paid to speak at and attend, and which were used by Aventis salespeople to promote the off-label use of Taxotere and other Aventis drugs. (Id. ¶ 66.) In particular, one of the Aventis salespeople Piacentile spoke to said that Dr. Paul Kline of St. Vincent's Hospital in New York City was paid to give presentations on off-label uses of Taxotere; sales representatives then targeted attendants of these presentations to promote Taxotere's off-label uses. (Id. ¶ 82.) In addition, Aventis arranged for Drs. Clifford A. Huddis and Naiyer A. Rizvi of Memorial Sloan-Kettering Cancer Center to give presentations and assist Aventis's off-label marketing efforts. (Id. ¶ 83.) Aventis's Taxotere market share at Sloan-Kettering then doubled within one year. (Id.) According to the complaint, whenever a physician or medical institution submitted a claim to a government program for reimbursement for an off-label use that Aventis had promoted, a false claim was submitted in violation of the FCA. (Id. ¶ 78.)

B. Aventis's Kickback Scheme

Piacentile alleges that Aventis conducted a three-pronged kickback scheme, under which it provided physicians with money, property, and services to induce them to prescribe Aventis drugs, including Taxotere and Anzemet, which is used to control nausea induced by chemotherapy. (Id. ¶ 56.)

First, Piacentile alleges that Aventis paid doctors money to induce prescriptions. Aventis salespeople had budgets of up to $36,000, referred to as a ―martini budget,‖ to use induce doctors to prescribe Aventis drugs. (Id. ¶ 91.) Aventis also paid a handful of high-prescribing physicians more than $2,000 each year to speak at lavish dinners attended by other physicians and tailored sham research grants to physicians as rewards for prescribing the company's drugs. (Id. ¶ 92--93.) One physician who received a grant was Huddis; Piacentile claims that Huddis helped to increase Sloan-Kettering's purchases of Taxotere from 170 vials per month to nearly 400 vials per month, mostly for off-label use. (Id. ¶ 94.) Drs. Mark Kris and Nadir Rizby of Sloan-Kettering, and Dr. Michael Kane of the Cancer Institute of New Jersey also received grants, and Dr. Kline received $3,500 to give her presentations. (Id. ¶¶ 95, 97.) In addition, Aventis maintains lists of doctors who use Aventis drugs off-label and pays them between $750 and $1,000 to attend conferences where such uses are discussed. (Id. 98--99.) According to the complaint, whenever a physician who had received money from Aventis submitted a claim to the government seeking reimbursement for an off-label use, a false claim was submitted in violation of the FCA. (Id. ¶ 104.)

Second, Piacentile alleges that Aventis provided millions of dollars of free drugs to physicians, including free samples and overfilled vials, to induce them to prescribe Aventis drugs. According to Piacentile's sources, 116 Aventis sales representatives each provided up to 1,200 free samples a year, totaling more than $50 million in market value over a five-year period. (Id. ¶ 108.) Aventis also provided doctors with vials of product that exceeded the necessary dosage, which doctors then used on other patients; this extra product totaled more than 100 vials per month. (Id. ¶ 109.) One salesman told Piacentile that he gave Dr. Richard Burke of Mount Sinai Hospital free samples for 15 to 20 patients and that Burke could collect $30,000 on each of these samples by billing Medicare and Medicaid for them. (Id. ¶ 110.) The salesman also provided free samples to oncologists at Salick Health Care, including Dr. Arthur Goldberg and Dr. William Grace. (Id. ¶ 111.) Aventis also gave discounts to health care formulary groups based on Aventis's market share of the groups' prescriptions. (Id. ¶ 112.) Dr. Burke brought $750,000 per year to Aventis in Anzemet sales from Mount Sinai, and both Drs. Goldberg and Grace increased their use of Anzemet. (Id. 113.) According to the complaint, each time one of these doctors sought reimbursement from the government for Anzemet, a false claim was submitted. (Id.)

Third, Piacentile alleges that Aventis provided free services to doctors, including practice management consulting services and lessons in how to mix Taxotere and Anzemet prescriptions to ―get the most out of the vials‖ by capturing excess product. (Id. ¶¶ 117--19.) According to the complaint, each time a doctor received free services from Aventis and then sought ...


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