Three Drug Companies to Pay $122.6 Million to Resolve Kickback Allegations--Update
April 04 2019 - 3:09PM
Dow Jones News
By Michael Dabaie
The Justice Department said on Thursday that three
pharmaceutical companies -- Jazz Pharmaceuticals PLC, Lundbeck LLC
and Alexion Pharmaceuticals Inc. -- --agreed to pay a total of
$122.6 million to resolve allegations they paid drug copays for
their pharmaceuticals through copay-assistance foundations.
The Justice Department alleged the companies violated the False
Claims Act by illegally paying copays required by two federal
health programs for the companies' own products through purportedly
independent foundations that the companies used as conduits. The
Justice Department also said the claims in the settlement are
allegations and there has been no determination of liability.
The federal programs were Medicare and the Civilian Health and
Medical Program, or ChampVA, from the Department of Veterans
Affairs.
When a Medicare beneficiary obtains a prescription drug covered
by Medicare, the beneficiary may be required to make a partial
payment -- and under ChampVA, patients may be required to pay a
copay for medications, the Justice Department said. The
Anti-Kickback Statute prohibits a pharmaceutical company from
offering or paying, directly or indirectly, any remuneration --
which includes money or any other thing of value -- to induce
Medicare or ChampVA patients to purchase the company's drugs, which
extends to the payment of patients' copay obligations, the Justice
Department said.
"We reached an agreement that will allow us to put this matter
behind us and continue our focus on providing innovative
medications for people living with brain disorders. The agreement
doesn't include any admission that we violated any law" Lundbeck
said Thursday.
Alexion said it would pay about $13 million under the terms of
the agreement. "Alexion announced that it has finalized its
settlement with the U.S. Department of Justice to resolve claims
related to the company's support of independent charity patient
assistance programs between 2010 and 2016," the pharmaceutical
company said.
Jazz said in a Securities and Exchange Commission filing it will
pay the U.S. government $57.0 million, plus interest. Jazz said
during 2018 it recorded a $58.2 million charge related to this
matter.
Jazz also said it has maintained -- and remains committed to --
a comprehensive compliance program for legal and regulatory
requirements. "This includes requirements relating to our continued
support of independent charity patient assistance programs, which
provide financial assistance to patients who would otherwise be
unable to access life-changing medicines," the company said in an
emailed statement.
The company added: "The settlement agreement is not an admission
by Jazz of liability or the facts alleged by the DOJ, but a
settlement of the government's claims."
Jazz and Lundbeck each entered five-year corporate integrity
agreements as part of the settlements. The agreements require the
companies to implement measures, controls and monitoring to promote
independence from any patient assistance programs to which they
donate. In addition, the companies agreed to implement
risk-assessment programs and obtain compliance-related
certifications from company executives and board members.
Alexion wasn't required to enter into corporate integrity
agreement because it made organizational changes, the Justice
Department said, including hiring a new eight-member executive
leadership team and changing half of the members of its board.
"These enforcement actions make clear that the government will
hold accountable drug companies that directly or indirectly pay
illegal kickbacks," said Assistant Attorney General Jody Hunt of
the Justice Department's Civil Division.
(END) Dow Jones Newswires
April 04, 2019 14:54 ET (18:54 GMT)
Copyright (c) 2019 Dow Jones & Company, Inc.
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