Ranbaxy, Good Manufacturing Practices and the False Claims Act for Whistleblowers

When drug manufacturers fail to observe the FDA’s Good Manufacturing Practices (“GMP” standards), the result can be liability to the government for false claims under the False Claims Act through a qui tam suit.  Here is an example from yesterday, where the whistleblower was awarded $48 million for bringing this to the federal government’s attention.

In court filings yesterday, Ranbaxy the Indian generic drug manufacturer admitted it sold batches of drugs that were improperly manufactured, stored and tested. The company also plead guilty to making fraudulent statements to the Food and Drug Administration about how it tested drugs at two of its Indian plants. FDA inspections of facilities in Paonta Sahib and Dewas in India, beginning in 2006, found incomplete record-keeping, testing failures and other quality-control issues. Earlier, lapses in manufacturing procedures made it impossible to ensure the drugs were of the required purity, according to the criminal information.

Drugs cited in criminal charges as failing to meet FDA standards include the antibiotics ciprofloxacin, cefaclor and amoxicillin, the acne drug Sotret, and Gabapentin, a compound used to treat epilepsy and certain kinds of nerve pain.  The whistleblower a former Ranbaxy executive, will receive $48.6 million from the federal government’s share, which totals $231.8 million.

Here is the link to the FDA’s GMP guidelines:

http://www.fda.gov/cosmetics/guidancecomplianceregulatoryinformation/goodmanufacturingpracticegmpguidelinesinspectionchecklist/default.htm

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