Bloomberg News

Amgen Whistle-Blower Loses Bid to Challenge Aranesp Deal

January 03, 2013

A doctor who accused Amgen Inc. (AMGN:US) of illegally marketing drugs lost his bid for a court hearing to challenge the company’s $612 million civil settlement of misbranding claims.

U.S. District Judge Sterling Johnson denied the doctor’s request yesterday, according to a record filed in federal court in Brooklyn, New York. The order didn’t give any explanation for the decision.

Joseph Piacentile, a New Jersey physician, said in court papers that he got an “ultimatum” from the government to either sign onto a global settlement of Amgen whistle-blower claims or face possible dismissal of his case. Piacentile declined to participate in the settlement and the U.S. has since asked the judge to dismiss the suit, according to court records.

Amgen, the world’s largest biotechnology company, pleaded guilty in December to a misdemeanor charge of misbranding its anemia drug Aranesp and agreed to settle a group of whistle- blower suits alleging the company also engaged in illegal sales practices regarding other drugs. The company agreed to pay $150 million in criminal penalties and $612 million in civil settlements.

‘Relator’s Share’

Piacentile declined to settle because the government refused to provide information about his allocation of the total settlement, a lawyer for Piacentile, Eric Cramer, said in a memorandum filed Dec. 28. As a so-called relator, Piacentile could share in a recovery under the False Claims Act.

“The government is attempting to settle relators’ claims out from under them without providing either the statutory relator’s share, adequate notice or an opportunity to be heard by this court as to the fairness of that outcome,” according to the memorandum.

Piacentile had worked on an undercover investigation of Amgen and collected evidence from top marketing executives at the company and at an important customer, cancer treatment network U.S. Oncology, according to a complaint filed in September 2004 and unsealed after the settlement was announced.

The doctor alleged in his suit that Amgen, based in Thousand Oaks, California, “routinely” paid kickbacks to doctors to encourage them to prescribe at least seven drugs, including Aranesp, psoriasis treatment Enbrel and Neulasta, which helps cancer patients fight infections.

Robert Nardoza, a spokesman for the U.S. Attorney’s office in Brooklyn, declined to comment on the case.

‘Wholly Improper’

In a Dec. 31 court filing, prosecutors said Piacentile’s request for a hearing “is wholly improper and should be denied” or at least stayed pending the judge’s decision on the government’s motion to throw out the case.

The settlement “does not compromise the ability of relators in this action to go forward with their case, should they survive the motion to dismiss,” according to the government’s filing.

Piacentile is a “serial filer” of whistle-blower complaints, having lodged at least 13 such cases against various companies in federal courts, prosecutors said in documents filed in November seeking to dismiss the case.

Piacentile has a website, Whistleblowers Against Fraud, which pursues whistle-blower claims and maximizes rewards, according to the memorandum. In the suit against Amgen, Piacentile added a former company sales representative, Kevin Kilcoyne, to the complaint, according to the memorandum.

“Piacentile was never employed by Amgen and is not an inside employee who has risked income or employment to become a whistle-blower based on direct knowledge of fraud at Amgen,” prosecutors said in the filing.

The case is U.S. ex rel. Piacentile v. Amgen Inc., 2:04- cv-03983, U.S. District Court, Eastern District of New York (Brooklyn).

To contact the reporter on this story: Christie Smythe in New York at csmythe1@bloomberg.net

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net


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Companies Mentioned

  • AMGN
    (Amgen Inc)
    • $137.89 USD
    • -1.07
    • -0.78%
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