Valeant Unit Settles Claims of Pushing Drugs With Pricey Dinners

  • Salix agrees to pay $54 million to settle U.S. kickback claims
  • Settlement follows months of turmoil at slumping Valeant

A Valeant Pharmaceuticals International Inc. unit agreed to pay $54 million to settle U.S. claims that it paid kickbacks to doctors for prescribing its products, the government said.

Salix Pharmaceuticals treated doctors to dinners costing more than $200 a person at restaurants such as New York’s Nobu and Le Bernardin, according to a whistle-blower lawsuit that the U.S. joined last week. Salix also paid speaking fees of as much as $4,500 at outings that were “often little or nothing more than social gatherings for the doctors and other healthcare professionals,” the U.S. said.

“All of the conduct alleged in the government’s complaint predated Valeant’s acquisition of Salix and involved personnel who are no longer with the company, Laurie Little, a Valeant spokeswoman, said in an e-mail.

The Salix settlement comes after months of turmoil at Bridgewater, New Jersey-based Valeant, including investigations by U.S. authorities, an accounting scandal, scrutiny of drug price increases and disappointing earnings. The company’s shares have dropped 90 percent in the last nine months.

The expensive perks were intended to increase sales of seven products used to treat gastroenterology conditions, U.S. Attorney Preet Bharara said in a statement Thursday. Salix was pushing the sales of Xifaxan, Apriso, Relistor, MoviPrep, OsmoPrep, Solesta and Deflux, the government said.

A Wagyu steak at Nabu’s 57th Street location in Manhattan is on the menu for $34 an ounce while the “Chef’s Choice” multi-course omakase offering costs as much as $180 a person.

The case is U.S. v. Salix Pharmaceuticals Inc., 12-cv-03870, U.S. District Court, Southern District of New York (Manhattan).

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