A major New Jersey pharmaceutical firm has agreed to pay over $642 million to the Federal government to settle claims that it violated the False Claims Act (a/k/a “Lincoln’s Law”) for allegedly paying kickbacks to doctors and allegedly paying illicit copayments to Medicare beneficiaries for those taking two of its drugs.
Per investigators, the firm allegedly learned of several hundred patients who were taking a multiple sclerosis drug in late 2012 who would soon become eligible for Medicare the following year. They say the firm helped transition those individuals to Medicare Part D knowing that they (the firm) would soon benefit from reimbursements for the drug via the program. As certain of its buyers were unable to afford the copay, investigators say the firm arranged to pay the copay themselves, violating rules established for the Medicare program.
In addition, investigators say the pharmaceutical company paid illegal kickbacks to doctors to persuade them to prescribe several of their drugs to their patients. They say the kickbacks were paid as honoraria for speaking at events about the drug, but it was allegedly well known amongst all the participants that the speaking events were little more than expensive dinners at fine restaurants, where little, if any, discussion was held regarding the drugs. Federal investigators say some payments were for speeches that never took place as well. The drug company allegedly identified doctors who frequently prescribed their drugs and pressured them into writing even more scrips for the company’s drugs and threatening them with exclusion from the program if they failed to do so.
For allegedly paying copayments for Medicare recipients, the drug firm will pay the Federal government $51.25 million, and for allegedly paying kickbacks to doctors it will pay $591,442,008.