Humana Roche False Claims Act Action

Case name: United States of America ex rel. Crystal Derrick v. Roche Diagnostics Corp. et al.

Case type: Whistleblower & Qui Tam

Filed in: [United States District Court for the Northern District of Illinois]

Docket: [Case no. 1:14-cv-04601]

Case Summary

In 2014, Sanford Heisler Sharp filed a whistleblower action on behalf of the Relator, a former employee of Roche Diagnostics, alleging that the company violated the Anti-Kickback Statute and False Claims Act by submitting false claims to the Medicare Advantage program, and that when the whistleblower reported this fraudulent activity to corporate management she was terminated in retaliation.

The whistleblower Complaint alleged that Indianapolis-based Roche Diagnostics, which manufactures and markets medical devices to monitor and manage blood sugar, and co-defendant Humana, based in Louisville, Ky., and which administers Medicare Advantage health plans, entered into a kickback relationship.

Medicare Advantage health plans (sometimes called Medicare Part C) are Government-funded health plans that are administered by private companies known as Medicare Advantage Organizations.

According to the Complaint, Roche forgave millions of dollars owed by Humana in exchange for Humana (through its subsidiaries Humana Pharmacy and Humana Pharmacy Solutions, Inc.) purchasing Roche diabetes testing supplies over competitors’ products. In this way, Roche traded debt forgiveness in exchange for Humana favoring Roche diabetes testing supplies for purchase over competitors’ products in a government-funded Medicare business, the Complaint alleged.

In June 2018, litigating on behalf of the government and the Relator, Sanford Heisler Sharp attorneys defeated Defendants’ motions to dismiss the case and aggressively pursued discovery. In 2021, as motions on the merits of the case were pending, the parties agreed to a settlement in which Roche and Humana would pay $12.5 million to settle the government’s claims of fraud, with the Relator receiving a 29% share of the settlement, or $3,625,000.

The case was the first False Claims Act settlement arising from a Medicare Advantage Organization accepting a kickback from a pharmaceutical company.