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Pharma Fraud

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FDA’s Approval of Alzheimer’s Drug Highlights Need for Whistleblowers

Posted  07/9/21
By Edward Baker
stamping saying fda approved
The Food and Drug Administration (FDA) is supposed to protect American consumers from unscrupulous private actors—charlatans, snake-oil salesmen, and the like—seeking to profit by selling unproven medical “cures,” treatments, and devices to the public.  Emerging during the era of the robber barons as part of Theodore Roosevelt’s efforts to “civilize capitalism,” the FDA has prevented untold harm to...

June 14, 2021

Centene Corp. will pay a total of $143.8 million to resolve claims by Ohio and Mississippi that it overbilled the states' Medicaid programs in its role as a pharmacy benefit manager.  The states alleged that Centene engaged in practices including "spread pricing," charging more than allowed price caps based on industry standards, inflation of dispensing fees, failure to disclose discounts received, and claiming reimbursement for prescriptions already paid for by third parties.  Ohio will receive $88.3 million, and Mississippi will receive $55.5 million.  OH; MS

Book Review: “Empire of Pain: The Secret History of the Sackler Dynasty,” by Patrick Radden Keefe

Posted  06/3/21
By Max Voldman
Last October, Purdue Pharma, the inventor, manufacturer, and marketer of Oxycontin, the drug at the center of the opioid crisis, reached a massive healthcare fraud settlement with the Department of Justice. The Department advertised the settlement as an $8.3 billion dollar recovery, which would make it one of the largest healthcare fraud settlements in history. In his book Empire of Pain, Patrick Radden Keefe explores...

May 28, 2021

Erik Santos of Georgia was sentenced to more than 11 years in prison following his guilty plea on healthcare fraud charges.  Santos conspired with Florida compounding pharmacy Patient Care America and others to recruit Tricare beneficiaries to fill prescriptions for expensive, supposedly tailor-made, compounded medications that consisted of little more than common pain or scar creams, but came with price tags as high as $10,000-$15,000 per month.  The beneficiaries did not need the medications, which had little to no therapeutic value, and Santos secured the prescriptions by paying doctors, who had not actually seen the beneficiaries, to approve pre-printed prescriptions for large amounts of these medications.  Santos’s fraudulent referrals caused an actual loss to the Tricare program of approximately $12 million.  PCA pharmacy paid Santos over $7 million in prescription referral kickbacks.  In addition to the prison sentence, the Court imposed restitution in the amount of $11.8 million and entered a forfeiture judgement of approximately $7.6 million.  USAO SD FL

DOJ Lowers The Boom On COVID-19 Healthcare Scams, Again

Posted  05/28/21
COVID Virus Zoomed In
Hey, fraudsters, did you hear?  There was a global pandemic, so the government pumped trillions of dollars into the economy.  Probably a good time to get a piece of the cut, you ask?  They’ll never find out, right?  So many ways to grift! Well, not so much.  From the start, the cops on the beat, led by the United States Department of Justice, have screamed from the rooftops:  “Don’t do it.  We WILL...

Catch of the Week: Another Pharma Company, Incyte, Settles FCA Claims For Kickbacks to a Charitable Foundation

Posted  05/7/21
By Edward Baker
pills scattered around
The Department of Justice announced this week that Incyte Corporation, a Delaware pharmaceutical company, has agreed to pay $12.6 million to resolve allegations that it violated the False Claims Act by paying kickbacks to a charitable foundation to increase prescriptions for the drug Jakafi, which is used to treat myelofibrosis, a form of leukemia that causes extensive scarring in bone marrow and leads to severe...

May 4, 2021

Delaware-based pharmaceutical company Incyte Corporation has agreed to pay $12.6 million to resolve allegations of violating the Anti-Kickback Statute and False Claims Act in connection with its myelofibrosis drug, Jafaki.  Despite federal laws against illegal remuneration to federal healthcare program beneficiaries, Incyte allegedly wielded its influence as the sole donor of a foundation to coerce the foundation into illegally covering the copays of Medicare and TRICARE patients taking Jafaki.  The misconduct continued from 2011 through 2014 before it was revealed in a qui tam suit by former compliance executive turned whistleblower, Justin Dillon.  Dillon will receive approximately $3.59 million for his efforts.  DOJ; USAO EDPA

Catch of the Week: Dozens of Fraudsters Sentenced in Multimillion Dollar Compounding Pharmacy Fraud

Posted  04/30/21
compounding pharmacy drugs
On Thursday, an Alabama District Court Judge sentenced dozens of defendants to prison for participating in a massive conspiracy to swindle insurers for medically unnecessary compound drugs. The defendants included company executives and managers, a prescriber, billers, and sales representatives associated with Northside Pharmacy, which was doing business as Global Compounding Pharmacy (Global). According to the DOJ...

Bristol-Myers Squibb Settlement Highlights a Common-Sense Law: The Medicaid Drug Rebate Program

Posted  04/2/21
Drug prices are out of control.  They now account for roughly 10% of our healthcare spending and America’s per capita outlay has nearly doubled over the past two decades.  For the least fortunate among us, many of these medications have become out of reach altogether. While new proposals are regularly made, one approach that often gets overlooked is simply enforcing the laws already on the books. That is just...

April 1, 2021

Pharma company Bristol-Myers Squibb will pay $75 million to settle a False Claims Act action, filed by a whistleblower, alleging that the company failed to pay amounts it owed under the Medicaid Drug Rebate Program. That program, the MDRP, requires drug manufacturers to report the Average Manufacturer Prices (AMPs) of their Medicaid-covered drugs to the government; the higher the reported AMPs, the greater the rebate owed by the pharma company to the government.  The whistleblower alleged that Bristol-Myers systematically under-reported their AMPs for a number of its drugs, including by reducing service fees it paid to wholesalers and excluding the value of price appreciation provisions in wholesale contracts. Of the total settlement, $41 million will be paid to the federal government, and the remainder to states participating in the settlement.  The government did not intervene, and the action was pursued by the whistleblower, Ronald J. Streck, who will receive an undisclosed share of the settlement.  USAO EDPA
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