Bayer Whistleblower Settlement Over Trasylol, Avelox and Baycol Results in $40 Million Payment

Agreement comes following a whistleblower lawsuit filed by a former marketing employee, who will receive $11 million award for uncovering the misconduct and pursuing the Bayer settlement through the False Claims Act.

Bayer will pay $40 million to resolve claims raised in a whistleblower lawsuit, which alleged the company engaged in illegal kickbacks and off-label marketing for the drugs Trayslol, Avelox and Baycol.

The U.S. Department of Justice issued a press release on September 2, announcing the Bayer whistleblower settlement agreement (PDF), which will resolve alleged violations of the False Claims Act.

The agreement stems from two whistleblower lawsuits filed by Laurie Simpson, who used to work for Bayer’s marketing division, and will receive approximately $11 million from the settlement proceeds, for bringing the wrongdoing to the attention of the U.S. government and pursuing the case to conclusion.

The whistleblower lawsuits accused Bayer of illegally paying kickbacks to hospitals and doctors to sell the drugs to patients, and also claims the company marketed the drugs for off-label uses not approved by the FDA which were unreasonable and unnecessary. Simpson also alleged Bayer deceived the medical community and customers by downplaying the potential side effects of Trasylol, leading to false Medicare and Medicaid claims in 20 states.

Bayer was also accused of downplaying the risks of Baycol, a statin drug used to treat high cholesterol, which has been linked to a risk of causing rhabdomyolysis, which causes the breakdown of muscle tissue which can lead to kidney damage.

Both Baycol and Trasylol, a drug used to prevent bleeding after heart surgery, have been withdrawn from the market for safety reasons. Avelox, an antibiotic, is still on the market.

“Simpson diligently pursued this matter for almost two decades,” Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Department of Justice’s Civil Division, said in the press release. “Today’s recovery highlights the critical role that whistleblowers play in the effective use of the False Claims Act to combat fraud in federal healthcare programs.”

The settlement agreement involves Bayer paying $38,860,555 to the U.S. government, and a combined $1,139, 445 to 20 states and the District of Columbia. Simpson will receive about $11 million from the settlement through the qui tam provisions of the False Claims Act.

Bayer has agreed to the settlement without an admission of liability or guilt.