Articles Tagged with whistleblower

Massachusetts Whistleblower News

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Linde AG’s Lincare unit will pay $20 million to resolve a whistleblower lawsuit accusing the company of fraudulently billing the U.S. government for oxygen and respiratory care equipment.

The settlement, confirmed by the U.S. Attorney’s Office in Massachusetts,  ends a whistleblower lawsuit filed under the False Claims Act by former employees of the respiratory therapy services provider on behalf of the U.S. government. Lincare, is one of the largest U.S. providers of oxygen and respiratory therapy services and equipment, did not admit wrongdoing. Its settlement agreement was released late Monday after the deal received the U.S. Justice Department’s approval.

A whistleblower Patty Nixon, who worked as a sales representative for the drug manufacturer Insys, says that its major drug Subsys was prescribed for patients who never should have had it.She’s a former Insys sales rep turned whistleblower. According to the company web-sire the drug contains the massively strong medication fentanyl and it is a spray that is absorbed underneath the tongue, which results in faster absorption.

Whistleblower Nixon says her job was to contact insurance companies on behalf of the patients and the doctors to get the medication approved and paid for by their insurance company. Nixon says NBC that her supervisor told her ways to trick the insurers into believing it was “medically necessary.” The medication is approved only for cancer patients but was apparently sold to patients who did not have cancer.

Prosecutors say the company paid hundreds of thousands of dollars to doctors in exchange for prescribing Subsys. Three top prescribers have already been convicted of taking bribes from Insys. Insys has denied any responsibility and insists it shouldn’t be blamed for how doctors prescribe their products. The corporation is not facing criminal charges and is still selling Subsys — some $240 million worth of Subsys just last year.

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Coffee is now being studied more closely by researchers who are seeing potential for significant disease prevention and therapeutics. They are trying to understand how the coffee and caffeine actually work within the cells as population studies show promise for therapeutics. Harvard researchers have done a study which indicates that drinking 1-3 cups of caffeinated coffee can reduce diabetes risk. The studies are looking back at data of 126,000 people over 18 years and not the more rigorous forward clinical studies but the trends are strong. Another study suggests that people who drink coffee regularly are 80% less likely to develop Parkinson’s disease. The evidence is also strong that the reported benefits of coffee is the caffeine content. Caffeine is a vasodilator and phosphodiasterase inhibitor. Parkinson’s drugs are now being develop which contain a derivative of caffeine, based on the evidence from research studies. Caffeine has also been seen to benefit asthma sufferers and headache sufferers possibly because it acts to dilate blood vessels. Drs. are now trying to understand why coffee demonstrate these benefits and how it acts on a cellular level.

The United States Internal Revenue Service (IRS) has awarded $38 million to a whistleblower informant for revealing tax fraud by a large corporation according to his lawyers. According to counsel the IRS could have collected up to $250 million based on the law under which the claim was brought. Last month another whistleblower of tax fraud was awarded over $104 million for his part in revealing tax havens in Switzerland and the names of hundreds of individuals not paying their share of U.S. taxes.

Jeffrey Newman represents whistleblowers. Jeffrey.Newman1@gmail.com

A very common corporate scheme to save taxes and avoid having to pay benefits is when companies classify employees as independent contractors and issue a 1099. This is tax fraud clear and simple and has opened up a potential for whistleblowers with specific information about their company misclassifying full time employees as independent contractors to reveal that tax fraud and receive a large reward for doing so. The tax liability must exceed $2 million dollars and the proof available must be substantial and easy to follow. In addition, the matter must be reported in the right way and not revealed to the media or others. Executives, inside accountants or senior managers should also be aware that the government is now investigating these issues and it is better to report the matter than be the subject of a criminal investigation.

HOW TO KNOW THE DIFFERENCE BETWEEN AN EMPLOYEE AND INDEPENDENT CONTRACTOR

If a person is on an employer’s payroll and receives a steady paycheck, the person is likely an employee. If a person supplies their own tools, equipment and material and the worker controls their own hours they are generally considered independent contractors. The employer’s tax liability is determined by the worker’s employment status. With employees, employers must pay state and federal unemployment tax, social security tax and workers compensation tax. When a person is an independent contractor, the hiring company is not required to make any such payments.

On May 20, the U.S. Department of Justice informed a federal judge that it was discussing settlement of claims relating to the illegal marketing of Depakote. A whistleblower suit was filed against Abbott by Susan Mulcahy, Doreen Merriam and Sondra Knowles, all from Massachusetts and specialty executives with Abbott. They alleged that the company tried to promote Depakote for the off label treatment of Alzheimer’s disease and for use as a chemical restraint for elderly patients who become agitated or aggressive. Depakote was approved by the FDA in 1983 as a treatment for epilepsy. Depakote has been linked to an increased risk that a child will be born with severe birth defects or malformations when the medication is taken during the first trimester. In 2006, a warning about the potential risk of Depakote birth defects was placed on the label after a stidy found that 20% of thepregnant mothers who gave birth while on Depakote had a child with malformations or a birth defect.

Ven-A-Care, a small Key West Fla. company is fighting a campaign against drug companies that overcharge the government and since starting has collected over $2 billion dollars for state and federal governments. In addition, it has won over $380 million for itself in the form of whistleblower awards. The most recent victory was a $170 million verdict against generic drug maker Actavis which was charged with overcharging Medicaid for drugs.Pharmacies and drug providers buy medicines from drug companies and distribute them to Medicaid recipients. Medicaid then reimburses the pharmacies for the cost of the drugs, plus a markup for the cost. But Ven-A-Care owners observed that some companies were routinely charging the pharmacies one price but told Medicaid and Medicare that the price was much higher. Then when the government reimbursed the pharmacies this resulted in a windfall profit. Ven-A-Care sued under a law called the False Claims Act, which allowed it to recover a reward of a percentage of moneys the government collected. This is considered the most successful case for the whistleblower, even brought and is exemplary of a trend in which companies are becoming whistleblowers as opposed to individuals.

Long term care Pharmacy Remedi Seniorcare Inc has agreed to pay $1.3 million to resolve a whistleblower claim that it unlawfully recycled, repackages, redistributed and re-billed thousands of drugs to Medicare and Medicaid beneficiaries. The whistleblower estimated that the percentage of recycled medicine to resulted in 80% of what was entrusted to the company for disposal.

Each year, taxpayers must pay an extra $1,000 to cover those cheating on their taxes. Now, the IRS is taking an agressive and new approach to recover the more than $350 billion that companies and individuals are evading in their taxes. Congress passed a law mandating that the IRS begin paying whistleblower rewards as high as 30% of what the IRS recovers based on the information provided. Both Republicans and Democrats are serious about preventing what has been increasing government fraud.There is no limit. You could report hundreds of millions of tax evasion if you have information to support it and it is NOT necessary to prove that the company intended on cheating. In addition, in this new program, the IRS is committed to maintaining confidentiality meaning they don’t reveal names in most instances. There are detailed steps to follow and things to watch out for. You will need an attorney to help with these and to make sure you are paid the amounts you are due under the law.