Department of Justice Probes Manufacturers of Zantac

First, the FDA removed the popular heartburn drug Zantac from the market in April 2020. Now, the Department of Justice is considering an investigation into the manufacturers of Zantac. Specifically, the DOJ is interested in whether the manufacturers Glaxo SmithKline and Sanofi knew about the presence of the cancer causing NDMA in Zantac and withheld the information from the public.

According to Reuters, The U.S. Department of Justice has opened an investigation into whether drugmakers including Sanofi SA failed to disclose to the federal government information about the potential presence of a probable carcinogen in the heartburn drug Zantac.

After global recalls of heartburn medicine Zantac and an FDA ban, the Department of Justice is investigating Sanofi and GlaxoSmithKline for possible violations of the False Claims Act.

Many of the Fraud Section’s cases are suits filed under the False Claims Act (FCA), 31 U.S.C. §§ 3729 - 3733, a federal statute originally enacted in 1863 in response to defense contractor fraud during the American Civil War.

The FCA provided that any person who knowingly submitted false claims to the government was liable for double the government’s damages plus a penalty of $2,000 for each false claim. The FCA has been amended several times and now provides that violators are liable for treble damages plus a penalty that is linked to inflation.

In addition to allowing the United States to pursue perpetrators of fraud on its own, the FCA allows private citizens to file suits on behalf of the government (called “qui tam” suits) against those who have defrauded the government. Private citizens who successfully bring qui tam actions may receive a portion of the government’s recovery. Many Fraud Section investigations and lawsuits arise from such qui tam actions.

The Department of Justice obtained more than $3 billion in settlements and judgments from civil cases involving fraud and false claims against the government in the fiscal year ending Sept. 30, 2019. More information about those recoveries can be found here and the 2018 FCA statistics can be found here.

The drugmakers last year pulled their Zantac products over an impurity believed to cause cancer, and Sanofi said the probe is over disclosures relating to that impurity. GSK didn't comment on the nature of the investigation, but a spokesman said the company is cooperating.

A 1981 study appears to indicate that the Zantac manufacturers knew about but didn't disclose the presence of NDMA in the drug. At this point, these remain allegations. However, they are serious enough to compel the DOJ to investigate.

In addition to the Department of Justice probes, both Sanofi and GlaxoSmithKline disclosed a Zantac-related lawsuit from the New Mexico Attorney General. That suit alleges violations of the state’s unfair practices act, false advertising, public nuisance and negligence.