A whistleblower’s $45 million False Claims Act lawsuit alleging Humana and Roche Diagnostics engaged in an illegal kickback scheme and other health care fraud will stand after an Illinois federal judge rejected two motions to dismiss the allegations.
Crystal Derrick, a former Roche account manager, filed the whistleblower complaint on behalf of the U.S. government in 2014, HealthPayer Intelligence reports. She alleges that Roche improperly dismissed debt Humana owed to Roche in a bid to keep Roche Diagnostic’s diabetes testing products on Humana’s formularies. The deal also helped bar competitor products from Humana’s formularies, the whistleblower complaint alleged.
According to Louisville Business First, the lawsuit claims the alleged kickback arrangement gave Roche inappropriate access to participants of Humana’s insurance plans.
The whistleblower lawsuit asserts that Humana intended to nix Roche’s products from its formularies for Medicare Advantage plans and Medicare prescription drug plans in March 2013. However, Ms. Derrick found that Roche had overpaid Humana in rebates, the amount of which was later determined to be $45 million
Roche “recognized an opportunity to be placed back on Humana’s formularies,” the whistleblower complaint alleges, according to Louisville Business First. The drug maker offered to settle the debt with Humana for $27.6 million, but Humana officials used the leverage of the company’s formularies to lower that debt to $20 million, then to $11 million, court documents say.
Ms. Derrick claims she was fired after she explained the legal implications of the deal to her supervisors at Roche Diagnostics.
Judge Elaine E. Bucklo of the U.S. District Court for the Northern District of Illinois allowed Ms. Derrick’s whistleblower retaliation claims against Roche to stand but dismissed her retaliation claims against Humana because she was not a Humana employee.
“The Court affirms the important principle that financial arrangements between managed care organizations and pharmaceutical companies are not immune from the False Claims Act and Anti-Kickback Statute,” a lawyer for the whistleblower stated, according to HealthPayer Intelligence.