In what the plaintiff’s attorneys are calling the first False Claims Act settlement arising from a Medicare Advantage organization accepting a kickback from a pharmaceutical company, Humana Inc., Roche Diagnostics Corp. and related entities this month agreed to pay $12.5 million to resolve allegations that they engaged in a debt forgiveness scheme to keep Roche’s products on Humana’s formularies. Although the settlement amount is relatively small and the government did not intervene in the relator’s case, experts say the suit has some important takeaways for MA organizations.
The case (U.S. ex rel. Crystal Derrick v. Hoffman-La Roche Ltd. et al. 1:14-cv-04601), originally filed in 2014 in the Illinois Northern District Court, was brought by a former Roche employee who claimed she was privy to internal discussions that resulted in Roche forgiving millions of dollars owed by Humana in exchange for continued access to its formularies. These included formularies for Humana’s MA plans and the Right Source mail-order formulary, which covered diabetes products such as glucose strips, meters and lancets made by Roche.