Whistleblower Nabs $33.6 Million in Endo False Claims Suit

A whistleblower’s willingness to wear a wire added $7 million to her share of the Endo Pharmaceuticals False Claims Act settlement over its painkiller Lidoderm.

Judge Robert F. Kelly of the U.S. District Court for the Eastern District of Pennsylvania decided that Peggy Ryan deserved 24 percent, or $33.6 million, of the federal government’s $140 million share, dismissing the government’s request for a smaller amount. Endo agreed to a $171.9 million settlement with federal and state governments in February 2014 over claims it promoted Lidoderm for off-label uses.

Lidoderm (lidocaine patch 5 percent) is approved to treat pain associated with post-herpetic neuralgia, a complication from shingles.

Kelly ruled last week that not only did Ryan spark the investigation, but “she nurtured the flame at the darkest times” from the filing of her qui tam complaint in 2005 until the 2014 settlement.

Ryan wore a wire to record more than 200 hours of conversations, including one where a district manager declared 90 percent of Lidoderm’s prescriptions were for off-label use. After the government served a subpoena to Endo, Ryan reviewed the company’s responses to narrow the scope of the investigation and target the most relevant information.

When the government intervenes in a qui tam complaint, the whistleblower is eligible for 15 percent to 25 percent of the proceeds. The government argued that because of the size of the settlement, Ryan deserved 19 percent, or $26.6 million. — John Bechtel