Drugmaker Healthpoint has agreed to pay up to $48 million to settle allegations it sold Medicare a drug that was never approved by the Food and Drug Administration and which was ineligible for reimbursement. It becomes at least the fifth company to resolve its role in a sprawling, decade-old False Claims Act case pending in Massachusetts against two dozen companies.
Healthpoint, Fort Worth, agreed to pay at least $28 million to resolve allegations from a whistle-blower (PDF) that it sold a skin ointment called Xenaderm to Medicare and state Medicaid programs, even though the product was not approved for sale as a prescription drug. The settlement terms also apply to Healthpoint's parent company DFB Pharmaceuticals.
Healthpoint also agreed to pay another $20 million if it follows through with a planned, $782 million all-cash acquisition this month by publicly traded Smith & Nephew.
The settlement agreement with the U.S. Justice Department (PDF) says Healthpoint did not admit liability or wrongdoing by settling the case. A company official could not be reached for comment Thursday.