Whistleblower lawsuit results in $1.1 million settlement with Novo Nordisk Inc.
News: 2017 Press Release
SACRAMENTO, Calif. — Insurance Commissioner Dave Jones reached a $1.1 million settlement with pharmaceutical company Novo Nordisk Inc. over allegations that Novo Nordisk's drug Victoza was extensively promoted for uses not approved of by the Food and Drug Administration, which violates the Insurance Frauds Prevention Action. The settlement stems from allegations in a whistleblower lawsuit filed by Peter Dastous, an Endocrinology Diabetes Care Specialist formerly employed by Novo Nordisk.
Victoza was approved by the FDA for the treatment of adults with Type II diabetes. Dastous, represented by Phillips & Cohen, LLP, alleged Novo Nordisk inappropriately marketed Victoza for use with pediatric patients with Type II diabetes and adult patients who did not have Type II diabetes. The FDA did not approve the use of Victoza for the treatment of pediatric patients, due to the lack of pediatric studies.
"Illegal and unethical pharmaceutical marketing practices puts patient health at risk in exchange for higher profits," said Insurance Commissioner Dave Jones. "The alleged marketing of the drug Victoza to pediatric patients with Type II diabetes and adults without Type II diabetes not only violated patients' trust but it's also against the law."
In approving Victoza, the FDA issued a warning that the medication had a risk of tumors caused by Medullary Thyroid Carcinoma (MTC). Victoza's marketing was inconsistent with the labeling instructions and warnings concerning the risk of MTC tumors.
The settlement also addresses allegations that Novo Nordisk officials provided its sales force with information used to create a false or misleading impression, which minimized the importance of the FDA warning concerning the risk of tumors caused by MTC. Certain Novo Nordisk sales representatives allegedly made false or misleading statements designed to circumvent the requirements of the warning issued through the FDA.
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This whistleblower lawsuit was filed by Peter Dastous, an Endocrinology Diabetes Care Specialist ("EDCS") responsible for the sale of Novo's diabetes products in South Carolina and Northern Georgia, who is represented by Erika Kelton and Larry Zoglin of Phillips & Cohen LLP. Commissioner Jones joined the whistleblower in the lawsuit.
As required by the state's insurance whistleblower law, Novo Nordisk's settlement payment will be divided between the whistleblowers and the State of California. The state will receive $550,000, to be used to enhance the investigation and prevention of insurance fraud.
Novo Nordisk did not admit to wrongdoing in the settlement agreement.
This settlement is contemporaneous with other federal and state settlements.
Other examples of CDI qui tam cases:
Bristol Myers Squibb qui tam: http://www.insurance.ca.gov/0400-news/0100-press-releases/2016/release082-16.cfm
Warner Chilcott qui tam: http://www.insurance.ca.gov/0400-news/0100-press-releases/2015/release117-15.cfm
Sutter Health qui tam: http://www.insurance.ca.gov/0400-news/0100-press-releases/2013/release094-13.cfm
Led by Insurance Commissioner Ricardo Lara, the California Department of Insurance is the consumer protection agency for the nation's largest insurance marketplace and safeguards all of the state’s consumers by fairly regulating the insurance industry. Under the Commissioner’s direction, the Department uses its authority to protect Californians from insurance rates that are excessive, inadequate, or unfairly discriminatory, oversee insurer solvency to pay claims, set standards for agents and broker licensing, perform market conduct reviews of insurance companies, resolve consumer complaints, and investigate and prosecute insurance fraud. Consumers are urged to call 1-800-927-4357 with any questions or contact us at www.insurance.ca.gov via webform or online chat. Non-media inquiries should be directed to the Consumer Hotline at 800-927-4357. Teletypewriter (TTY), please dial 800-482-4833.