Novartis Pharmaceuticals Corp. agreed to pay $678 million to resolve a whistle-blower case accusing the drugmaker of paying kickbacks to thousands of doctors who prescribed its medicines and wooing them with lavish dinners and trips to Hooters, ending almost a decade of litigation.
The U.S. sued the Swiss drugmaker in 2013, joining in a case filed two years earlier by a former sales representative who accused the company of using its speakers’ programs to bribe doctors to write prescriptions for its products.
Novartis paid “exorbitant speaker fees to doctors who gave no meaningful presentations, and provided expensive meals and alcohol to doctor attendees and their guests,” federal prosecutors in Manhattan said in a statement Wednesday. The case had been set to go to trial last year before being delayed to allow settlement talks to play out.
As part of the accord, Novartis will change how the company markets its drugs to doctors as part of a so-called “corporate integrity agreement,” the drugmaker said in a statement. The deal also resolved claims by the New York Attorney General’s Office over the kickbacks, designed to boost sales of the company’s cardiovascular and diabetes drugs reimbursed by federal health-care programs. Novartis shares rose less than 1% to 83.26 Swiss francs in Zurich trading Thursday.