Newman & Shapiro Announces $7.9 Million False Claims Act Settlement with Pharmaceutical Company Akorn Operating Company LLC

We’re pleased to announce that pharmaceutical company Akorn Operating Company LLC (Akorn) has agreed to pay $7.9 million to resolve allegations arising from a False Claims Act qui tam lawsuit Newman Shapiro filed in June 2021 on behalf of its whistleblower client, Albermarle, LLC (Albermarle).

Akorn manufactured and sold diclofenac sodium, a nonsteroidal anti-inflammatory cream that is a generic form of Voltaren, a popular treatment for arthritis pain. Albermarle’s complaint alleged that, after Voltaren (the so-called “reference listed drug”) switched from being a prescription drug to an over-the-counter (OTC) drug, Akorn continued selling its diclofenac gel as a prescription drug. Medicare, however, does not cover drugs that are equivalent to drugs that are available OTC. Albermarle alleged that, by continuing to market prescription diclofenac gel after Voltaren switched to OTC, Akorn caused the submission of false claims to Medicare. During the course of the government’s investigation, it came to light that Akorn also had continued to market other drugs as prescription drugs even though equivalent forms of those drugs were available OTC.

As a whistleblower reward under the False Claims Act, Albermarle will receive approximately $946,000 of the government’s recovery.

The settlement shows the potential for other whistleblower cases against generic drug companies that continue to market their products as prescription drugs even after the associated reference listed drugs have gone OTC.

Newman & Shapiro filed the case under the caption United States ex rel. Albermarle, LLC v. Akorn Operating Company LLC, No. 21-cv-11060-ADB (D. Mass.). The settlement was finalized less than 15 months after we filed the case. Assistant United States Attorney Abraham R. George and Department of Justice Trial Attorney Augustine Ripa handled the case for the government. The Department of Justice press release announcing the settlement is here.

Gregg Shapiro was lead counsel for Albermarle in the Akorn case. He represents whistleblowers in False Claims Act qui tam cases involving pharmaceutical fraud and other health care fraud matters. He can be reached at 617-582-3875 or gshapiro@newmanshapiro.com.