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Pharmaceutical Whistleblower Case

Pharmaceutical Whistleblower CaseA federal judge ruled the whistleblower against Endo Pharmaceuticals is entitled to roughly $33.6 million.

Pharmaceutical company Endo Pharmaceuticals was allegedly promoting the drug Lidoderm for off-label uses and agreed to pay $171.9 million in settlement. $140 million of the settlement goes to the government. 24% of the government’s portion is going to the whistleblower – relator Peggy Ryan. The government, however, argued she should only receive 19% of the federal recovery.

The judge, U.S. District Judge Robert F. Kelly, stated “because of Ryan’s “extraordinary” contributions to the nearly decade-long litigation, she was entitled to more.” He also wrote in his memorandum, “An examination of the record exhibits that Ryan provided not only the spark for the investigation, but that she nurtured the flame at the darkest times when the possibility of a favorable outcome seemed most remote.  Throughout the nine-year period from her first qui tam complain in 2005 to the settlement in 20154, Ryan continually provided access behind the corporate walls of Endo. Ryan’s insider status, conferred by her employment with Endo, enabled the government investigatory team to recover evidence which would have otherwise been unobtainable.”

Ryan’s Role in this Qui Tam case

Whistleblower Peggy Ryan filed a qui tam complaint and an investigation into Endo’s alleged fraudulent practices was launched. Over the next year, Ryan wore a wire and recorded over 200 hours of conversation. Thanks to covertly recording the conversations, evidence was gathered of the unlawful marketing of Lidoderm. Kelly stated the recordings gathered by Ryan provided the evidence of Endo’s strategies to market the drug for off-label uses, promote the drug for off-label uses and management instructing sales representatives on how to convince doctors to promote the drug for said off-label purposes.

Kelly also said Ryan was able to record Lidoderm’s project manager saying 97 to 98 percent of Lidoderm’s prescriptions were off-label.

Judge Kelly made it clear that “It is the view of the court that without the assistance of Ryan, the probability of the government recovering any funds for the [False Claims Act] violations would have been slim at best.”

Ryan and the law firm representing her, James, Hoyer, Newcomer & Smiljanich in Tampa, Florida, produced an 18 minute documentary summarizing the case. This video was then distributed to every federal agent and prosecutor involved.

A word from Ryan’s Lawyer

Christopher Casper of James Hoyer said in a statement to The Legal, “It is never easy to be a whistleblower, especially when a case gone on for a decade, but Ms. Ryan has remained dedicated to the cause of exposing fraud against the government on behalf of the American taxpayer. It has been exactly 10 years and 10 days since this case was filed. We hope Judge Kelly’s decision to grant Ms. Ryan close to the maximum percentage for a relator will encourage other individuals with evidence of fraud against the government to come forward. This case demonstrates that the False Claims Act is the most powerful tool the government has in fighting fraud.”


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