Sometime last year, one of our esteemed bloggers wrote: “The qui tam provision of the FCA, which permits private plaintiffs – sorry, relators – to steer FCA claims presents marvelous opportunities for mischief.” We couldn’t have said it any better, so we won’t try. Moreover, mischief makes us think of the Marauder’s Map (Harry Potter) – created by complex magic, it allowed its user to track the movements of everyone within the walls of Hogwarts. The map’s contents, however, only revealed themselves to those who knew the activating phrase: I solemnly swear I am up to no good. We think relators are acutely familiar with this phrase.
A few months before that astute mischief observation, we also posted that the Eastern District of Texas had dismissed a similar FCA claim involving the off-label use of Botox to treat pediatric migraines. The court granted the relator an opportunity to amend his off-label claims, which he apparently did. So, here we are nearly a year later, but this time on a summary judgment motion. Little else appears to have changed.
To prove an FCA claim, the relator needs evidence that the defendant made “(1) a false statement; (2) with the requisite scienter; (3) that was material; and (4) caused the government to pay out money or to forfeit moneys due.” United States ex rel. Hearrell v. Allergan, Inc., 2025 U.S. Dist. LEXIS 37033, at *2 (E.D. Tex. Mar. 3, 2025). The relator in Hearrell advanced two FCA theories. One, that defendant violated the FCA by violating the Anti-Kickback Statute (AKS). Two, that defendant violated the FCA by promoting Botox for an off-label purpose, in this case the treatment of chronic migraines in minors.
On the AKS theory, plaintiff would have needed to establish that the defendant “knowing and willfully” paid a doctor to induce him/her to prescribe Botox, a claim for which was then submitted to Medicaid for federal reimbursement. The only evidence relator offered was that the defendant retained Key Opinion Leaders (“KOLs”), a common practice in the pharmaceutical industry. KOLs provide consulting and advisory services for drug manufacturers and can be paid for speaking engagements. That is completely legal and not evidence of a kickback. The relator alleged that the payments were for KOLs to make “referrals to pediatric specialists.” Id. *3. But at oral argument, relator had to concede he had no evidence to support that allegation. Not that further discovery would have turned up any such evidence, but relator did not depose or obtain written/document discovery from any KOL. Id. at *4. Another indication that relator was really up to no good here.
As for his off-label promotion theory, it failed at step one—no proof of a false statement. That’s because the Medicaid claims at issue “explicitly disclose” that the treatments were for off-label pediatric use. Further, Medicaid “routinely reimburses” for such off-label use and the prescribing physician “obtained prior authorization” for each prescription. Id. at *4-5. Relator’s only counter to this overwhelming evidence was that defendant misrepresented Botox as “safe and effective” for pediatric migraine treatment. The court found the argument unpersuasive. “If the government knows the particulars of a claim and approves it, that claim cannot be fraudulent.” Id. at *5.
Finding no material disputed fact on either theory, the court granted summary judgment for defendant.
Mischief managed.