What is the rescission of advisory opinion 06-04?
Senate Finance Committee regarding the rescission of Advisory Opinion 06-04, including how the OIG came to learn about the misrepresentations that the charity made, and whether the OIG plans to audit or review other PAPs and similar advisory opinions.
What is a rescinded OIG letter?
However, on November 28, 2017, the OIG issued a letter rescinding Advisory Opinion 06-04 (“Rescission Letter”), based on the charity’s “failure to fully, completely, and accurately disclose all relevant and material facts to OIG,” and CVC’s alleged failure to comply with certain factual certifications made to the OIG. Specifically, the OIG states that it determined that the charity “provided patient-specific data to one or more donors that would enable the donor (s) to correlate the amount and frequency of their donations with the number of subsidized prescriptions or orders for their products, and (ii) allowed donors to directly or indirectly influence the identification or delineation of Requestor’s disease categories.” [14] The Rescission Letter indicates that CVC’s failure to comply with the certifications “materially increased the risk” that CVC served as a conduit for financial assistance from a drug manufacturer donor to a patient, and thus inappropriate steerage to the donor’s drugs.
What is the OIG opinion on CVC?
In December 2015, the OIG published a Modified Advisory Opinion 06-04, following the OIG’s request that CVC certify compliance with the additional factors outlined in the 2014 Special Advisory Bulletin. The Modified Advisory Opinion stated that CVC had certified compliance to each additional factor, and further that CVC had proposed additional modifications to its current operations. [13] The OIG concluded in the Modified Advisory Opinion 06-04 that CVC’s PAP was sufficiently low risk and the OIG would not impose CMPs or sanctions on CVC under the AKS.
What should stakeholders do with PAPs?
Stakeholders should also closely monitor federal and state legislative policy developments regarding PAPs, including copayment assistance and product coupons. K&L Gates regularly advises clients on health care fraud and abuse risk mitigation and compliance matters and facilitate stakeholder engagement with Congress and state legislators and HHS.
What are the two aspects of PAP?
The OIG has indicated that PAPs generally have two “remunerative aspects” that require scrutiny under the AKS: i) donor contributions , which the OIG stated can be analyzed as indirect remuneration to patients , and ii) financial assistance remuneration provided directly to patients. The OIG states that the AKS could be violated “if a donation is made to a PAP to induce the PAP to recommend or arrange for the purchase of the donor’s federally reimbursable items,” as well as if a PAP’s grant of financial assistance to a patient is made “to influence the patient to purchase (or induce the patient’s physician to prescribe) certain items.” [5]
What is the purpose of PAPs?
Department of Health and Human Services (“HHS”) Office of the Inspector General (“OIG”) has continually acknowledged that properly structured PAPs can provide important “safety net assistance” to patients with limited financial means who cannot afford necessary drugs. This Client Alert provides a comprehensive review ...
What is the focus of PAPs?
Ultimately, data sharing and communication between charity PAPs and donors appears to be the key area of focus for OIG, DOJ, and IRS enforcement. If such communication and data sharing is prohibited, whether by state statute or federal regulatory enforcement, it is remains to be seen whether PAPs will continue to operate as they are currently structured. In any event, it is incumbent upon interested parties to stay abreast of changes in the law and developing enforcement trends, and to continually monitor and update their compliance programs accordingly. For example, given the amount of scrutiny applied to coordination between the business and charitable giving arms of medical product manufacturers, compliance programs should be actively examining all intra-firm transactions to assure that no improper influence is being exerted over communications with and donations to charity PAPs.
What is the OIG CIA?
The December 2017 OIG CIA was announced as part of a settlement between United Therapeutics and the Department of Justice (DOJ), which alleged that United Therapeutics induced patients to purchase its drugs by donating to charity PAPs over which it exerted some control.
What is the OIG opinion on Caring Voice?
The Office of Inspector General’s (OIG) advisory opinion protected Caring Voice Coalition from liability under the Anti-Kickback Statute for its work providing financially needy Medicare patients with premium and cost-sharing assistance. Drug companies are the primary donors to almost all charity patient assistance programs (PAPs), including Caring Voice Coalition, while some drug companies also create their own charity PAPs. The OIG’s 2006 opinion issued to Caring Voice Coalition was fact-specific, as are all advisory opinions, and in this case was predicated on commitments the charity made to implement certain safeguards regarding contributions from donors and grants to beneficiaries.
Is United Therapeutics in the CIA?
Subsequent to entering the CIA with United Therapeutics, and on the same day Caring Voice Coalition announced it would not offer financial assistance in 2018, OIG released a letter it sent to a drug company trade group, dated January 4, 2018.
What is the alleged violation of the OIG?
According to the OIG, the alleged violations “materially increased the risk that [the charity] served as a conduit for financial assistance from a [drug company] donor to a patient,” and thus increased the risk that the charity’s Medicare patients would be steered to that company’s federally reimbursable drugs.
Is Caring Voice Coalition offering financial assistance?
Last week, one of the largest charity patient assistance programs in the country, Caring Voice Coalition, announced that it would not be offering financial assistance for any of its disease funds in 2018.
How much did Sanofi pay to Medicare?
BOSTON – The U.S. Attorney’s Office announced today that pharmaceutical company Sanofi-Aventis U.S., LLC (“Sanofi”), has agreed to pay $11.85 million to resolve allegations that it violated the False Claims Act by paying kickbacks to Medicare patients through a purportedly independent charitable foundation, The Assistance Fund (“TAF”).
Did Sanofi pay TAF?
The United States further alleged that Sanofi made payments to TAF not with a charitable purpose but rather with the intention of using TAF as a conduit to pay the financial obligations, including Medicare co-pay obligations, of patients taking Lemtrada, and that Sanofi’s payment through TAF of Medicare co-pays for Lemtrada violated the Anti-Kickback Statute. To effectuate its scheme, Sanofi worked with its third-party reimbursement hub to identify Medicare patients for whom physicians had prescribed Lemtrada, but who had not yet received infusions of the drug because they lacked sufficient funds to afford the co-pays for Lemtrada. Sanofi made nine payments to TAF during 2015 and 2016. At the times Sanofi made eight of these nine payments, TAF’s MS fund had run out of funding, and was closed to new patients. In conjunction with its payments to TAF, and knowing that TAF’s MS fund did not maintain wait lists and would fund the first patients who applied for assistance after the fund received new funding, Sanofi instructed its hub quickly to refer as many Lemtrada patients as possible to the TAF MS fund. As a result, when TAF’s MS fund opened with funding from Sanofi, Lemtrada patients received a disproportionately large share of the Medicare co-pay grants TAF issued and patients taking MS drugs other than Lemtrada received a disproportionately small share of the Medicare co-pay grants TAF issued.
Does Sanofi sell Lemtrada?
Sanofi sells Lemtrada, a multiple sclerosis drug that costs nearly $100,000 per patient per year. Medicare co-pays for Lemtrada can be many thousands of dollars per year. The cost of the drug often presents significant barriers to access for Medicare patients.
Is TAF a 501c3?
The government alleged that TAF, an entity claiming 501 (c) (3) status for tax purposes, operates funds, including a fund for MS patients, that pay the co-pays of certain patients, including Medicare patients, who were prescribed Lemtrada.
How much did Novartis pay for the second matter?
In the second matter, Novartis will pay $591,442,008 to resolve FCA claims that it paid kickbacks to doctors to induce them to prescribe the Novartis drugs Lotrel, Valturna, Starlix, Tekturna, Tekturna HCT, Tekamlo, Diovan, Diovan HCT, Exforge, and Exforge HCT. In addition, Novartis will forfeit $38.4 million under the Civil Asset Forfeiture Statute. Novartis also made extensive factual admissions in the settlement and agreed to strict limitations on any future speaker programs, including reductions to the amount it may spend on such programs.
How much did Novartis pay for the first settlement?
In the first settlement, Novartis has agreed to pay $51.25 million to resolve allegations that it illegally paid the copay obligations for patients taking its drugs. When a Medicare beneficiary obtains a prescription drug covered by Medicare, the beneficiary may be required to make a partial payment, which may take the form of a copayment, coinsurance, or a deductible (collectively “copays”). Congress included copay requirements in the Medicare program, in part, to serve as a check on health care costs, including the prices that pharmaceutical manufacturers can demand for their drugs.
How much did Novartis pay?
Pharmaceutical company Novartis Pharmaceuticals Corporation (Novartis), based in East Hanover, New Jersey, has agreed to pay over $642 million in separate settlements resolving claims that it violated the False Claims Act (FCA). The first settlement pertains to the company’s alleged illegal use of three foundations as conduits to pay ...
Why did the government kick back Novartis?
The government’s complaint further alleged that Novartis sales representatives, on the instruction of their managers, selected high-volume prescribers to serve as the paid “speakers” at these events with the intent to induce them to write more — or keep writing many — Novartis prescriptions. The sales representatives then pressured the speakers to increase their prescriptions of Novartis drugs, and often dropped doctors from the speaker program if they failed to do so. Further, the government alleged that this widespread kickback scheme was the result of decisions made by top management at Novartis’s North American headquarters in New Jersey.
What is a CIA for Novartis?
Contemporaneous with the settlement of the FCA claims in these matters, Novartis entered into a corporate integrity agreement (CIA) with the Department of Health and Human Services Office of Inspector General (HHS-OIG). The five-year CIA addresses the conduct at issue in both matters. Among other things, the CIA requires Novartis to significantly reduce the number of paid speaker programs and the amounts spent on such programs. Under the CIA, Novartis speaker programs may only occur under limited circumstances and in a virtual format. In addition, the CIA requires Novartis to implement measures designed to promote independence from any patient assistance programs to which it contributes. The CIA also requires multi-faceted monitoring of Novartis’s operations and obligates company executives and Board members to certify about compliance.
What is the anti kickback statute?
The Anti-Kickback Statute prohibits anyone from offering or paying, directly or indirectly, any remuneration — which includes money or any other thing of value — to induce referrals of items or services covered by Medicare, Medicaid, and other federally funded programs. This prohibition extends not only to improper payments to providers, but also to the improper payment of patients’ copay obligations.
Does Novartis sell Gilenya?
Novartis sells Gilenya, which is approved for treatment of relapsing forms of multiple sclerosis (MS). The government alleged that, in October 2012, Novartis learned from the contractor managing Novartis’s free drug program for Gilenya that over 300 patients who were receiving free drugs would be eligible for Medicare in 2013. ...
How much did Novartis pay for kickbacks?
Novartis Agrees to Pay Over $51 Million to Resolve Allegations that It Paid Kickbacks Through Co-Pay Foundations. BOSTON – Novartis Pharmaceuticals Corporation (Novartis) has agreed to pay $51.25 million to resolve allegations that it violated the False Claims Act by illegally paying the Medicare co-pays for its own drugs.
What is the CIA requirement for Novartis?
The CIA requires Novartis to implement measures, controls, and monitoring designed to promote independence from any patient assistance programs that it finances . In addition, Novartis agreed to implement risk assessment programs and to obtain compliance-related certifications from company executives and Board members.
What is the CIA for Novartis?
Novartis entered into a five-year corporate integrity agreement (CIA) with OIG as part of this settlement and a simultaneous settlement being announced today by the United States Attorney’s Office for the Southern District of New York. The CIA requires Novartis to implement measures, controls, and monitoring designed to promote independence from any patient assistance programs that it finances. In addition, Novartis agreed to implement risk assessment programs and to obtain compliance-related certifications from company executives and Board members.
What is a partial payment for Medicare?
When a Medicare beneficiary obtains a prescription drug covered by Medicare Part B or Part D, the beneficiary may be required to make a partial payment, which may take the form of a co-payment, co-insurance, or deductible (collectively, co-pays). Congress included co-pay requirements in these programs, in part, to encourage market forces to serve as a check on health care costs, including the prices that pharmaceutical manufacturers can demand for their drugs. The Anti-Kickback Statute prohibits pharmaceutical companies from offering or paying, directly or indirectly, any remuneration – which includes money or any other thing of value – to induce Medicare patients to purchase the companies’ drugs.
Does Novartis cover PNET?
Nonetheless, with Novartis’ knowledge, CDF launched a fund labeled “PNET” that covered co-pays only for Afinitor and did not cover co-pays for the other PNET drug. Novartis continued with this understanding as the sole financial backer of this supposed “PNET” fund through 2014.
Does Novartis donate to RCC?
Novartis informed NORD that it would be willing to donate to its RCC fund if NORD narrowed the fund’s eligibility definition so as not to cover co-pays for first line treatments. Novartis wanted the definition narrowed to ensure that a greater amount of its donations would subsidize its product, as opposed to others.
Is Afinitor a second line?
Novartis knew that Afinitor was approved for use as a second-line RCC treatment only, and only when certain first-line products had failed. Novartis also knew, therefore, that any co-pays NORD covered for initial RCC treatments would not be used to cover co-pays for Afinitor.
How much did Pfizer pay to Medicare?
BOSTON – The U.S. Attorney’s Office announced today that pharmaceutical company Pfizer Inc. has agreed to pay $23.85 million to resolve allegations that it violated the False Claims Act by paying kickbacks to Medicare patients through a purportedly independent charitable foundation.
How long does it take for Pfizer to comply with the CIA?
The five-year CIA requires, among other things, that Pfizer implement measures designed to ensure that arrangements and interactions with third-party patient assistance programs are compliant with the law.
How much did Amgen pay for False Claims Act?
(Astellas) and Amgen Inc. (Amgen) – have agreed to pay a total of $124.75 million to resolve allegations that they each violated the False Claims Act by illegally paying the Medicare copays for their own products, through purportedly independent foundations that the companies used as mere conduits.
What is anti kickback law?
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 patients to purchase the company’s drugs. This prohibition extends to the payment of patients’ copay obligations.
What is a partial payment for Medicare?
When a Medicare beneficiary obtains a prescription drug covered by Medicare, the beneficiary may be required to make a partial payment, which may take the form of a copayment, coinsurance, or a deductible (collectively “copays”). Congress included copay requirements in the Medicare program, in part, to serve as a check on health care costs, including the prices that pharmaceutical manufacturers can demand for their drugs. 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 patients to purchase the company’s drugs. This prohibition extends to the payment of patients’ copay obligations.
Does Amgen sell Sensipar?
Amgen: Amgen sells the secondary hyperparathyroidism drug Sensipar and the multiple myeloma drug Kyprolis. Amgen acquired Kyprolis as part of its acquisition of Onyx Pharmaceuticals Inc. in 2013. With respect to Sensipar, the government alleged that, in late 2011, Amgen stopped donating to a foundation that provided financial support to patients taking any of several secondary hyperparathyroidism drugs and approached a new foundation about creating a “Secondary Hyperparathyroidism” fund that would support only Sensipar patients. Amgen allegedly worked with the new foundation to determine the fund’s coverage parameters and, in November 2011, the foundation launched a “Secondary Hyperparathyroidism” fund with Amgen as its sole donor. Until June 2014, the fund covered only Sensipar. Amgen allegedly made payments to the fund even though the cost of these payments exceeded the cost to Amgen of providing free Sensipar to financially needy patients. However, by enabling the fund to cover the copays of Medicare beneficiaries, Amgen caused claims to be submitted to Medicare and generated revenue for itself.
Did Astellas pay $100 million for Xtandi?
The government further alleged that, during the time that the ARI funds were open, Astellas promoted the existence of the ARI funds as an advantage for Xtandi over competing drugs in an effort to persuade medical providers to prescribe Xtandi. Astellas has agreed to pay $100 million to resolve the government’s allegations.
Is Astellas an ARI only fund?
In July 2013, both foundations opened ARI-only copay funds; Astellas was the sole donor to both funds. The government alleged that Astellas knew that Xtandi would likely account for the vast majority of utilization from each fund, and, in fact, Medicare patients taking Xtandi received nearly all of the copay assistance from the two ARI funds.
Does Astellas sell Xtandi?
Astellas : Astellas sells Xtandi, an androgen receptor inhibitor (ARI) used to treat certain prostate cancer; none of the other major drugs to treat the condition is an ARI. The government alleged that, in May 2013, Astellas asked two foundations about the creation of copay assistance funds to cover the copays for Medicare patients taking ARIs, but not for other types of prostate cancer drugs. In July 2013, both foundations opened ARI-only copay funds; Astellas was the sole donor to both funds. The government alleged that Astellas knew that Xtandi would likely account for the vast majority of utilization from each fund, and, in fact, Medicare patients taking Xtandi received nearly all of the copay assistance from the two ARI funds. The government further alleged that, during the time that the ARI funds were open, Astellas promoted the existence of the ARI funds as an advantage for Xtandi over competing drugs in an effort to persuade medical providers to prescribe Xtandi. Astellas has agreed to pay $100 million to resolve the government’s allegations.
