Subsidiary of Allergan Agrees to Pay $125M in Alleged Kick-Back to Doctors Scheme

Yesterday we reported that Allergan and Pfizer were in early talks of a potential mega-merger. Well today, a subsidiary of multibillion-dollar international pharmaceuticals company Allergan has agreed to plead guilty to a felony charge of health care fraud and agreed to pay $125M, prosecutors announced Thursday. A former company president was arrested.

Warner Chilcott ex-president W. Carl Reichel was arrested in Boston. According to a newly unsealed indictment Reichel has been charged with conspiring to pay kickbacks to physicians. According to The Province, "prosecutors allege that between 2009 and 2013 employees provided payments, meals and other remuneration to doctors to induce them to prescribe drugs made by Warner Chilcott. The company was bought in 2013 for $8.5 billion by Actavis, which has headquarters in Dublin and in Parsippany, New Jersey."

The unsealed document also showed that Warner Chilcott hired physicians for speaking arrangements which never occurred in return for prescribing the company's drugs to their patients. Not only is this morally wrong, but falsifying documents in the healthcare field also violates Health Insurance Portability and Accountability Act (HIPAA).

To read more from our staff on compliance click here

To read more from The Province click here