False Claims Suit Over Merck Unit’s Remeron Revived

Pharmacy company PharMerica Inc. must once again face claims it engaged in a scheme to defraud Medicaid by improperly incentivizing physicians to prescribe Remeron, an antidepressant made by Merck & Co. unit Organon, the First Circuit said Wednesday.

PharMerica argued that whistlelower James Banigan’s claims triggered the False Claims Act’s public disclosure bar, because they target the same fraudulent scheme revealed in a prior suit.

But Banigan satisfies the original source exception to the public disclosure bar, because as a former Organon employee he has direct knowledge of the alleged scheme, the U.S. Court of Appeals for the First Circuit ...