- AstraZeneca (AZN +0.2%) and Bristol-Myers Squibb (BMY +0.3%) win an appeal of an 11-year old whistleblower lawsuit accusing the companies of paying kickbacks to a medical benefits management firm in exchange for purchases and recommendations of drugs they manufacture.
- The suit was dismissed because the complaint filed by a former employee of the benefits manager did not satisfy the federal False Claims Act's requirement that the whistleblower be the original source of allegations of wrongdoing. The employee, Karl Schumann, sued the companies on behalf of the U.S. and 11 states alleging the firms paid kickbacks to Medco Health Solutions to buy and recommend their brand name drugs. Mr. Schumann sat in meetings at Medco but had no direct independent knowledge of the scheme. His knowledge came from reviewing documents and discussing them with colleagues who were involved.
- The U.S. declined to participate in the suit after a six-year investigation.