Dinesh Thakur, a former director of research information at Ranbaxy, who is a whistleblower on the deficient manufacturing practices of Ranbaxy will get Rs 244 crore ($48 million) for his act.
What are the charges on Ranbaxy?
Ranbaxy, which is Gurgaon (India) based pharmaceutical company has been found to have violated good management practices, produced falsifying drug data and manufactured and distributed certain adulterated drugs manufactured at Indian production sites. The company has pleaded guilty on account of three violations to US’s Food, Drug and Cosmetic Act (FDCA), and accepted that knowingly made false statements to the US Food and Drug Administration. The faulty generic drugs were manufactured at Ranbaxy’s facilities in Paonta Sahib and Dewas (India). It admitted to introducing select batches of adulterated drugs including Sotret, gabapentin, and ciprofloxacin. While Sotret is an acne drug and gabapentin is a drug used to treat epilepsy, ciprofloxacin is an antibiotic.
What is the penalty on Ranbaxy?
The company has agreed to pay $500-million penalty to the US government to settle a criminal and civil lawsuit which leveled charges of falsifying data from its drug facilities and shoddy manufacturing practices against it. It has been done under the False Claims Act of the US. It is a share of this recovery of penalty from the company which will be given to Dinesh Thakur as the provisions under the False Claims Act allow private citizens to bring civil actions on behalf of the US and share in any recovery.
What is False Claims Act of US?
The False Claims Act which is also called the “Lincoln Law” is an American federal law that imposes liability on persons and companies (typically federal contractors) who defraud governmental programs. The law includes a “qui tam” provision that allows people who are not affiliated with the government to file actions on behalf of the government (informally called “whistleblowing“). Persons filing under the Act stand to receive a portion (usually about 15–25 %) of any recovered damages. Claims under the law have typically involved health care, military, or other government spending programs, and dominate the list of largest pharmaceutical settlements. The US government has recovered nearly $22 billion under the False Claims Act b/w 1987 and 2008.