The Cross-Border Biotech Blog

Biotechnology, Health and Business in Canada, the United States and Worldwide

PhRMA and BIO in the U.S. Supreme Court: False Claims Act Whistleblowers Beware

As PhRMA and BIO hoped it would, the U.S. Supreme Court has agreed to hear the appeal of a False Claims Act (FCA) case that could determine how easy it is to bring a whistleblower suit under the statute.  Noting the prevalence of healthcare fraud cases brought under the FCA, PhRMA and BIO filed a brief as amici curiae, urging the Supreme Court to take the case and to limit whistleblower suits.

Whistleblowers can’t sue under the FCA if their suit is based on information in publicly disclosed federal reports or audits (see 31 U.S.C. §3730(e)(4)(A) if you’re so inclined) since the federal government has access to that information without a whistleblower’s help.  The Fourth Circuit case that’s being appealed holds that only federal reports and audits operate to bar a whistleblower suit, not state or local government reports or audits.  This decision puts the Fourth Circuit in line with the Third Circuit, but at odds with the Eighth, Ninth, and Eleventh Circuits.

In their amicus brief, PhRMA and BIO argued that allowing whistleblower suits based on allegations in state and local reports or audits would open a floodgate of opportunistic FCA litigation aimed at their members, increasing the costs to pharma and biotech companies and diverting resources from R&D efforts.

We will continue to follow the case (Graham County Soil & Water Conservation District v. United States ex rel. Wilson, 08-304).  Stay tuned…

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2 responses to “PhRMA and BIO in the U.S. Supreme Court: False Claims Act Whistleblowers Beware

  1. Pingback: Promotion « The Cross-Border Biotech Blog

  2. Pingback: Supreme Court Hears Oral Arguments in False Claims Act Whistleblower Case « The Cross-Border Biotech Blog

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