USD 109 million award for Novartis whistle-blower

On 22 July 2020, the U.S. Department of Justice (hereinafter “DOJ”) decided to pay USD 109.4 million to a whistle-blower and former sales representative of Swiss pharmaceutical company Novartis AG. This is one of the largest payouts ever in a whistle-blower case. It is in line with the USD 104 million award for a former UBS AG banker in 2012 for helping the U.S. government to uncover the Swiss bank over tax-avoidance schemes offered to U.S. clients.

The former Novartis employee begun wearing a wire to record doctors taking bribes from the pharmaceutical company and filed a lawsuit against his employer in 2011 under the U.S. False Claims Act. This law allows whistle-blowers to file a suit against companies on behalf of the U.S. government and to collect a percentage of any settlement or award. The DOJ joined the suit in 2013. Earlier this month, Novartis agreed to pay USD 678 million to end the proceedings. Because of the importance of the former sales representative’s role in the case, the DOJ agreed in a court filing to pay to the former employee 18.5% of the settlement, minus a USD 38.4 million forfeiture and separate resolutions with states totalling USD 48.2 million.

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