Image copyright Getty Images Image caption Martin Shkreli (right) has become synonymous with the bad behaviour of the pharmaceutical industry
A major opioid maker has agreed to pay $40m (£31m) to settle charges it underpaid claims for fraud relating to post-market post market monitoring of painkillers.
The settlement, agreed by Turing Pharmaceuticals and its related companies, marks a final chapter in a long, sometimes fractious, legal saga.
It ends a lawsuit brought by the US attorney in Massachusetts that accused them of deceiving healthcare authorities about the rate of opioid addiction and abuse.
The company dismissed the lawsuit as without merit.
“Today’s settlement agreement is an important result in the company’s efforts to put the past behind us,” said chief executive Martin Shkreli.
“We thank the United States Attorney’s Office for the District of Massachusetts for providing us this opportunity to put this chapter behind us,” he added.
The case was brought by Benjamin Rosenberg, a former mid-level manager at Massachusetts-based Omidria Pharmaceuticals.
In court papers unsealed this week, he claimed he became suspicious when the company began enrolling more people in its post-market monitoring programme and maintained higher than expected opioid rates.
A guard stands near the front doors of the Manhattan federal court on July 3, 2017
Mr Rosenberg filed suit in May 2015 on behalf of the Justice Department and said the company’s executives misled them about the extent of such problems.
After Mr Rosenberg joined the company in 2009, he claims, Omidria was told to lower its drug costs and markets for its drug to be marketed.
He said his suspicions grew after a review of the company’s own post-market monitoring database showed its infection rate was 11 times the national average for opioid pain medications.
Mr Rosenberg was later made a whistleblower and was made out to be “as responsible as the shareholders for the improper conduct”.
Among the nine defendants is Mr Shkreli, who was last month convicted of a criminal charge of securities fraud in a separate case.
Image copyright Getty Images Image caption Martin Shkreli regularly posted pictures of his $1,000 Wu-Tang Clan t-shirt and sold it for $2,750 online
In the wrongful settlement, Mr Shkreli was allowed to maintain his title as chief executive officer of the company, which at the time owned the technology for Omidria’s pain medication.
The company also promised to tell the federal court that it would not destroy any documents.
In a statement, Massachusetts Attorney General Maura Healey, who has worked closely with Mr Rosenberg on the case, said it proved the need for tougher laws governing post-market monitoring.
“We will continue to be vigilant in making sure healthcare providers and insurers cannot purchase and use confidential clinical data that was stolen from Omidria,” Ms Healey said.
The $40m payment of the settlement is comprised of the company’s “Dupont” payment system – the collection system for the initial screening and screening of patients – and roughly $10m in funds returned to Omidria’s insurer.
Three defendants – husband and wife Vishal and Gauri Mehta – have also settled a civil fraud suit brought against them by the regulator.
However, by completing the deal, the settlement does not affect them.