California Attorney General Rob Bonta has announced a $47 million settlement with pharmaceutical company QOL Medical and its CEO, Frederick E. Cooper. The settlement addresses allegations of false claims submitted to Medicaid and other government healthcare programs due to a kickback scheme involving free Carbon-13 test kits used to promote the drug Sucraid.
The scheme allegedly took place between 2018 and 2022, with QOL providing free C13 test kits to healthcare providers. These tests were used to identify potential patients for Sucraid, even when it was not medically necessary. As part of the resolution, California will receive $384,406 from the settlement.
Attorney General Bonta emphasized that patient health decisions should be based solely on patient welfare. "Kickback schemes putting profit before patients are not only immoral, they are also illegal," he stated. He also expressed gratitude for the cooperation of local, state, and federal partners in addressing this issue.
The allegations included violations of the Anti-Kickback Statute and both federal and state False Claims Acts. QOL admitted to distributing free C13 test kits starting in 2018 and using results from over 75,000 tests to market Sucraid through their sales force.
The California Department of Justice’s Division of Medi-Cal Fraud and Elder Abuse (DMFEA) plays a key role in protecting Californians by investigating fraud against the Medi-Cal program. The division is funded primarily by a grant from the U.S. Department of Health and Human Services, supplemented by state funding.