The Cochran Firm Legal Blog

In November 2003, one Eugene Duxbury filed a whistleblower case under the U.S. False Claims Act, asserting that Johnson & Johnson had been giving gifts to doctors who prescribed its anemia drug called Procrit. The False Claims Act allows people who have inside knowledge to sue a company that makes false claims against the government. They sue on behalf of the federal government and then obtain part of any recovery that is subsequently paid.

Duxbury was a former sales rep for J&J’s Ortho Biotech Products unit, having worked for them between 1992 and 1998. Ortho Biotech is now known as Centocor Ortho Biotech.

The suit further claimed that those gifts led to increased reimbursements by Medicare, which paid for the increased number of Procrit prescriptions. The gifts were free Procrit samples, discounts, and cash. So the case was designed as a Medicare fraud case.

Centocor Ortho Biotech appealed, arguing that the claim should be tossed out because it just rehashed old allegations made by other people and that they were too weak anyway for a lawsuit to be based on.

Last August, the First U.S. Circuit Court of Appeals in Boston ruled that Duxbury’s suit could proceed because he was an original source of information on this alleged fraud.

On Monday this week, the U.S. Supreme Court left that ruling to stand and made no comment. Duxbury’s attorneys estimate that this case is worth something between $3 billion and $10 billion.

Labels: main