New England Journal of Medicine publishes "special report" on pharma whistleblowers' experiences

by Ben Vernia | May 13th, 2010

In a May 13 article in the New England Journal of Medicine (NEJM), researchers from Harvard and the University of Melbourne in Australia report on their findings from interviewing 42 qui tam relators from 17 settled pharmaceutical False Claims Act cases.
Among their findings:

  • Discovery of fraud – most were insiders experiences a career change such as starting at a new company or a new position; initially, a large proportion of the whistleblowers refused to participate in the fraud.
  • Motivations – most claimed that they were motivated by considerations other than the prospect of a financial reward, such as integrity, altruism, public safety, justice and self-preservation.
  • The investigation – most whistleblowers actively participated in the investigation, and most described the pressure and workload as intense. In addition, they criticized the Department of Justice’s handling of their cases. According to the report:

    Finally, there was widespread criticism of the Justice Department’s collaborative posture, or lack thereof, during various phases of the investigation. Ten relators reported conflict with the investigators, most frequently at the outset. One remarked, “There was always an undertone of `How much were we involved in this?'” (Relator 16). Relators also complained that “the government doesn’t tell you anything” (Relator 5) about the status of the investigation, including when a settlement was imminent. Others were frustrated that “the wheels move really slow” and lamented the years spent waiting in a state of uncertainty (Relator 9).

  • Settlement – the relators received a wide range of awards – from $100,000 to $42 million, with a median value of $3 million. Although they reported that the settlements helped alleviate some financial and nonfinancial costs (and one likened his settlement to “hitting the lottery”), most viewed their award as small compared to the time they spent on the case and the cost to their careers.

In light of the strain on whistleblowers, the researchers suggested that the government consider offering “needed resources (for example, temporary financial or medical benefits)” during litigation. They also suggested that the government consider “[m]ore sophisticated approaches” to determining a relator’s share, and take into account the additional value of, and stress on, company insider whistleblowers. They also suggested that anti-retaliation provisions should be made more effective.

Comment: As the researchers noted, the self-reporting of whistleblower experiences “may reflect a socially desirable response bias.” The same might well be true of whistleblowers’ self-reporting of their contribution to the investigation, and this could have been assessed (at least indirectly) by looking at the time reports submitted by relators’ attorneys for recovery of attorney’s fees. The study’s criticisms of the Department of Justice’s relator share decisions would be more complete if they had correlated the relator’s share awarded – on a percentage basis – with the amount of the relator’s effort.

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