Novartis headquarters in Basel, Switzerland. Photo: Lucarista/Shutterstock.com

When former Novartis Pharmaceuticals Corp. sales representative and whistleblower Oswald Bilotta reached out to a Connecticut lawyer, he didn't know what could come next.

He called the Chester, Connecticut, offices of Shepherd, Finkelman, Miller & Shah in 2011 with allegations that Swiss drugmaker Novartis was providing kickbacks to doctors and others to promote their drugs. And he said he could prove it.

This led law firm founder and partner James Miller to recognize he had an important case that could be worth millions.

Miller at the time, though, had no idea that nine years later that thanks to intervention from the federal government, Novartis would pay $729 million to settle claims that it violated the federal False Claims Act and Anti-Kickback Statute.

According to the government, the company provided doctors with cash payments and lavish meals to have them prescribe its brands of cardiovascular and diabetes drugs.

The settlement was signed off on July 1.

Miller, the lead attorney on the whistleblower case, worked out of the Chester office of the law firm, which has eight U.S. offices and operations in London and Italy.

Miller said the federal government expressed interest in the case soon after his firm filed suit in 2011. The federal government joined the case in 2013. Miller's firm provided pertinent information over the years, and remained involved to the end.

"The most important information that we provided to the government in connection with this case was Mr. Bilotta's detailed knowledge and information regarding Novartis' sales practices in the New York metropolitan area, as supplemented by the extensive work that we performed with our investigators in establishing the nature of the scheme," Miller said. "We and Mr. Bilotta literally worked on this matter on a weekly, if not daily, basis throughout the entire pendency of the lawsuit."

Miller said his firm "personally incurred millions of dollars in expenses" and had a team of 30 lawyers and other professional over the course of nine years.

"It was a real partnership between us and the government," he said.

James Miller of Shepherd, Finkelman, Miller & Shah. Courtesy photo

At one point, Miller said, his client agreed to be wired and to attend Novartis events at the behest of the government.

"We were mostly holding his hand during the time he was being wired, but we were acting as counsel and protected his interest the best we could," Miller said.

The alleged kickbacks, Miller said, were "documented many times because Mr. Bilotta wore a wire. The wire showed there were bribes taking place."

Novartis, the government said in a release, organized thousands of "sham educational events at high-end restaurants and other venues, paid exorbitant speaker fees to doctors who gave no meaningful presentations, and provided expensive meals and alcohol to doctor attendees and their guests."

The government statement continues: "For more than a decade, Novartis spent hundreds of millions of dollars on so-called speaker programs … that were nothing more than bribes to get doctors across the country to prescribe Novartis drugs."

No one from the U.S. Attorney's Office for the Southern District of New York, the lead prosecutors, responded to a request for comment.

"The government kept us abreast throughout, and we continued to litigate the case," said Miller, who noted his firm spent "tens of thousands of hours on this case."

The payoff for his client as a whistleblower, Miller said, is expected to be massive.

"We expect Mr. Bilotta will receive about $100 million because he was the whistleblower," Miller said. As for his firm, Miller said, "The attorney fees we will be getting have not yet been decided. We are still in the middle of negotiations."

The lead attorney for Novartis was Evan Chesler, chairman of Cravath, Swaine & Moore, based in New York City. Chesler didn't respond to a request for comment Tuesday.

Novartis directed media inquiries to its website, where CEO Vas Narasimhan wrote: "Today's settlements are consistent with Novartis' commitment to resolve and learn from legacy compliance matters, We are a different company today, with new leadership, a stronger culture, and a more comprehensive commitment to ethics embedded at the heart of our company."

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