In an effort to "avoid the time, uncertainty and expense of litigation," among other things, Bayer HealthCare agreed to pay the government $97.5 million to settle a kickback case.
The U.S. Department of Justice alleged that Bayer paid Liberty Medical Supply, a major medical supplier, nearly $2.5 million to convince patients to switch to Bayer diabetic supplies. In addition, the Department of Justice claimed Bayer paid 10 other suppliers about $375,000. As a result, the suppliers submitted false claims to Medicare. The government said that in the "cash-for-patient" scheme, Bayer made payments to Liberty and hid them by saying they were advertising payments.
As part of the settlement, Bayer has also agreed to enter into a Corporate Integrity Agreement with the Department of Health and Human Services Office of Inspector General for its divisions that deal with the government. However, many in the industry question the value of such agreements, claiming that both compliance and enforcement can be low.
The $97.5 million does not include interest.
Arthur Higgins, the chairman of Bayer, said the company is eager to move beyond the litigation.