Biogen, Inc (NASDAQ: BIIB) has reached a US$900 million deal to resolve a long-running whistleblower lawsuit concerning its multiple sclerosis drugs, the company said in its quarterly earnings report on Wednesday.
The lawsuit, which was filed in 2015 by a former employee, alleges that the Massachusettes-based biotechnology company paid kickbacks to doctors to amp up prescriptions of Tecfidera, Tysabri and Avonex, the company’s drugs for multiple sclerosis.
The agreement-in-principle came just days before the trial was set to begin on Tuesday in a Boston federal court. The amount that the company paid is just a little short of the US$981.1 million that the plaintiff, Michael Bawduniak, was seeking in damages.
Bawduniak was a sales rep at the company from 2004 to 2012. He alleged that Biogen used consulting meetings and speaking events as cover to offer kickbacks to physicians. When he tried to stop the payment of these alleged kickbacks in 2011, he was demoted from a director of regional marketing position.
According to Biogen, the settlement doesn’t include any admission of liability. The two parties have yet to finalize the agreement.
This settlement comes at a difficult period for Biogen and its multiple sclerosis franchise. The franchise faces continuous sales declines from the emergence of generics and newer competition.
Biogen last traded at US$214.06 on the Nasdaq.
Information for this briefing was found via Biogen, Reuters and the sources mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
