Amgen, Amerisource sued over drug kickback scheme

NEW YORK (Reuters) - Biotechnology giant Amgen Inc and drug wholesaler AmerisourceBergen Corp were sued on Friday by 14 U.S. states and the District of Columbia over an alleged kickback scheme designed to boost sales of Amgen's popular anemia drug, Aranesp.

New York Attorney General Andrew Cuomo announced the lawsuit, which was filed in federal court in Boston.

It joins a related whistleblower lawsuit filed in the same court in 2006 and is one of many lawsuits accusing drugmakers of illegally marketing their products.

"Drugs should be prescribed to patients on the basis of need, effectiveness, and safety, not on a corporate giant's promise of an all-expense paid vacation," Cuomo said in a statement.

He said Amgen's bribing of doctors "left taxpayers footing the bill for free drug samples."

The lawsuit alleges Amgen and two AmerisourceBergen units, International Nephrology Network and ASD Healthcare, conspired to encourage doctors to bill third party payers such as Medicaid for Aranesp that was provided at no cost.

It said this resulted in "thousands of false claims to be paid by the state Medicaid programs that were ineligible for payment," causing millions of dollars of damages.

The lawsuit also alleges that kickbacks, including "sham consultancy agreements and weekend junkets," were made to medical providers to induce them to buy and prescribe Aranesp.

ARANESP SALES FALLING

Amgen spokesman David Polk said the allegations lack merit and that Thousand Oaks, California-based Amgen expects its employees to follow a code of conduct.

Michael Kilpatric, an AmerisourceBergen spokesman, said the Chesterbrook, Pennsylvania-based company is cooperating with a U.S. Department of Justice subpoena related to issues in the case. He said the company has had no contact with the state attorneys general and expects to defend itself vigorously.

A Justice Department representative was not immediately available for comment.

Worldwide sales of Aranesp, once Amgen's best-selling drug, totaled about $3.1 billion in 2008, Amgen said in its latest annual report.

Sales have fallen from $4.1 billion in 2006, when high doses of an older but similar Amgen anemia drug were linked to increased heart attack rates in kidney patients.

OTHER DRUGMAKERS SETTLE MARKETING CHARGES

Over the last several years, Bristol-Myers Squibb Co, Merck & Co Inc and Schering Plough Corp have each agreed to pay hundreds of millions of dollars to settle lawsuits or probes that in part alleged improper marketing of drugs.

And in February, federal investigators accused Forest Laboratories Inc of improperly marketing the antidepressants, Celexa and Lexapro, for use in children and paying kickbacks to doctors to do so.

Others involved in the Amgen case are California, Delaware, Florida, Hawaii, Illinois, Indiana, Louisiana, Massachusetts, Michigan, Nevada, New Hampshire, New York, Tennessee and Virginia, as well as the District of Columbia.

Amgen shares closed 56 cents down at $53.73 and AmerisourceBergen fell 51 cents to $22.15.

The case is United States of America et al v. Amgen Inc, U.S. District Court, District of Massachusetts, No. 06-10972.

(Reporting by Jonathan Stempel; additional reporting by Toni Clarke in Boston and Jeremy Pelofsky in Washington, D.C., editing by Gerald E. McCormick, Tim Dobbyn and Andre Grenon)

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