How to Get A Million Dollars and Never Pay Taxes!

Pharmaceutical Pharmaceutical Fraud Fraud

in a Qui Tam World in a Qui Tam World

Patrick J. OPatrick J. O’’ConnellConnell Chief, Civil Medicaid Fraud Chief, Civil Medicaid Fraud

Office of the Attorney General Office of the Attorney General

How to Get A Million Dollars and Never Pay Taxes!

• 1. First, Get a Million Dollars• 2. When the IRS asks why you did not

pay your taxes, you say: “I forgot”.

Get Yourself a Case

• 1. MFCU• 2. Qui tam statute• 3. Types of pharma cases:

• Pricing or “AWP”• Rebate• Off Label Marketing• PBM• Misrepresentation of efficacy or side effects

Chapter 36, Texas Human Resources Code

    -Automatic Trebles    -Fees and Costs

    -Penalties from $1,000-$10,000 Per unlawful act

    -Automatic exclusion from program for minimum of 10 years

Get Some Lawyers

• In-house Lawyers and Staff• Relator Lawyers and Staff• Outside Lawyers and Staff • Coordination with Other States Through

NAMFCU

Get Some Money

• Experts• Travel• Videographers• Court Reporters

State of Texas ex rel Ven-a-Care of the Florida Keys vs. Dey, Warrick &

Roxane• Filed Sept. 2000• Lawyers for Good Guys: 6• Lawyers for Bad Guys: 10+• > 130 Depositions• > 1,000,000 pages of documents• Travel to California, Tennessee, Ohio, New York, New

Jersey, Connecticut, Alabama• Sanctions against each company for discovery abuse• Largest sanction ever awarded in Travis County for

perjury in civil matter• Finally settled Nov. 2005• Recovery of $55.6 million, including $12.7 million in fees

and costs

State of Texas vs. Abbott Labs, Baxter & B. Braun

• Filed May, 2004• Settled with Baxter and B. Braun for $12.3

million• Texas Lawyers: 3• Relator Lawyers: 3• Abbott Lawyers: 15+• Current Fees and Costs: $5 million +• Mandamus to Ct. App. twice• Mandamus to Tex. Supreme Ct. twice• Removed and Remanded

Results

Results

• Since 1999, recoveries of $217 million• Texas recoveries of $127 million

– Federal: $58 million– State: $50 million– Relator: $19 million

Be Careful What You Wish For!

• Current Caseload: 175 • Current Unsealed Cases: 4

• Current Lawyer Staffing: 10• Requested Staff Increase Approved By

Legislature: 27 • Requested Appropriation Approved for

Biennium: $10.5 Million