BOSTON – A subsidiary of pharmaceutical manufacturer Warner Chilcott PLC that was accused of offering kickbacks to doctors for drug prescriptions has agreed to plead guilty to a felony charge of health care fraud, prosecutors announced Thursday. A former company president was arrested.
Warner Chilcott ex-president W. Carl Reichel was arrested in Boston. He was accused of conspiring to pay kickbacks to doctors.
Prosecutors allege that between 2009 and 2013 employees provided payments, meals and other remuneration to doctors to induce them to prescribe drugs made by Warner Chilcott. The company was bought in 2013 for $8.5 billion by Actavis, which has headquarters in Dublin and in Parsippany, New Jersey.
Reichel pleaded not guilty during his arraignment in U.S. District Court and was released on personal recognizance. Defence lawyer Joseph Savage called the charges “false.”
“For more than 30 years in the pharmaceutical industry, Carl Reichel worked hard and did the right thing, and these baseless claims can’t change that,” Savage said.
A status conference is scheduled in court on Dec. 10.
The Department of Justice said the company has agreed to pay $125 million to resolve its criminal and civil liability related to illegal marketing of drugs. Several people have been charged or pleaded guilty.
Authorities accused the company of manipulating previous authorizations to induce insurance companies to pay for prescriptions the insurers may not have otherwise paid for and making unsubstantiated marketing claims.
A Warner Chilcott U.S. Sales LLC spokesman did not comment.