Bristol-Myers Squibb will pay 515 million dollars to settle a probe into illegal kickbacks to doctors and fraudulent pricing of its drugs to government health programs, officials said Friday.
The Justice Department said the US pharmaceutical giant and its Apothecon subsidiary agreed to the payments to settle the civil allegations on drug marketing and pricing practices.
Bristol-Myers said the settlement covers the previously disclosed investigations that began several years ago. The company had agreed in principle to a settlement in December and to implement a five-year "corporate integrity agreement."
Government investigators alleged that Bristol-Myers from 2000 through mid-2003 paid "illegal remuneration to physicians and other health care providers to induce them to purchase BMS drugs," the Justice Department statement said.
The money was in the form of "consulting fees and expenses" to physicians and other health care providers as well as "travel to luxurious resorts."
From 1994 through 2001, according to investigators, Apothecon paid "illegal remuneration such as stocking allowances, price protection payments, market share payments, and free goods in order to induce its retail pharmacy and wholesaler customers to purchase its products."
In both cases, the government alleged that the company caused the submission of inflated and fraudulent claims to the federal health care programs.
"The integrity of our health care system rests on physicians being able to make decisions based on the best interests of their patients," said acting Attorney General Peter Keisler.
"This settlement reflects the Justice Department's strong commitment to holding drug companies accountable for devising and implementing fraudulent marketing and pricing schemes that undermine that decision-making process at the expense of federal health care programs for the poor and the elderly."
Bristol-Myers said in a separate statement it "is pleased to have resolved these matters from the past and is proud of its commitment to conduct business with the highest standards of integrity in its mission to extend and enhance human life."