PFE Pfizer Inc

By Jonathan D. Rockoff 

Pfizer Inc. has agreed to pay nearly $24 million to resolve allegations that it violated federal law by using a charity to pay Medicare patients' out-of-pocket costs for the company's prescription drugs, federal prosecutors said.

The settlement, with the U.S. Attorney's Office in Boston, resolves allegations stemming from an investigation into the charities, which help patients pay for prescription drugs with the help of donations from pharmaceutical companies.

Pfizer said it agreed to settle to "put this legal matter behind it and focus on the needs of patients." The company noted in a statement that the settlement wasn't "an admission of facts nor liability."

As part of the settlement, Pfizer has entered into a five-year corporate-integrity agreement with the government, which federal prosecutors said will require Pfizer to take steps to ensure its work with charities complies with federal law.

Pfizer said it continues to donate to charity patient-assistance programs.

"Donations to independent charitable organizations can provide significant assistance to patients with their copayments for prescriptions, and Pfizer continues to believe these programs help patients lead healthier lives," Pfizer said in a statement.

The federal investigation into such programs, which has involved drug companies in addition to Pfizer, has been looking into a Byzantine arrangement that helps Medicare patients meet their copays despite rules restricting company assistance.

Federal anti-kickback law has been interpreted to bar drug companies from providing copay assistance directly to Medicare patients. Companies can make donations to charities that furnish such financial help, but the charities are supposed to be free to use the donations to help patients taking any drug.

The U.S. Attorney's Office said in a statement that Pfizer used an unnamed charity that received company donations and a specialty pharmacy to get Medicare to pay for its cancer drugs Sutent and Inlyta, so Pfizer wouldn't have to provide them to patients at no cost.

The prosecutors said the charity and pharmacy sent Pfizer data "confirming" that Sutent and Inlyta patients got the copay assistance.

The U.S. Attorney's Office said Pfizer also worked with the charity to help patients afford the copays for heart-arrythmia drug Tikosyn that had risen as a result of price increases that Pfizer had taken on the drug.

Write to Jonathan D. Rockoff at Jonathan.Rockoff@wsj.com

(END) Dow Jones Newswires

May 24, 2018 12:37 ET (16:37 GMT)

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