Feds File Two Lawsuits Against Novartis for Allegedly Giving Kickback to Pharmacists and Physicians

11 Indest-2008-8By George F. Indest III, J.D., M.P.A., LL.M., Board Certified by The Florida Bar in Health Law

Novartis Pharmaceuticals Corporation (NPC) is currently fielding two different lawsuits, filed just days apart from each other, by the U.S. Department of Justice (DOJ). The first lawsuit was filed on April 23, 2013, alleging the company gave illegal kickbacks to pharmacists. A second lawsuit was filed on April 26, 2013, alleging illegal kickbacks were paid by NPC to health care providers. According to the DOJ, the government’s complaint seeks damages and civil penalties under the False Claims Act, and under the common law for paying kickbacks to doctors to induce them to prescribe NPC products that were reimbursed by federal health care programs.

Click here to read the entire press release from the DOJ.

Doctors and Pharmacists Allegedly Paid to Prescribe.

Both lawsuits allege NPC violated the Anti-Kickback Statute. In the April 23, 2013, complaint against NPC the lawsuit alleges the company gave kickbacks, in the form of rebates and discounts to pharmacies in exchange for the pharmacies’ cooperation in switching patients from competitors’ drugs to NPC products.

The April 26, 2013, lawsuit accuses NPC of paying doctors to speak about certain drugs at events that were allegedly social occasions. Many of the programs were allegedly held in circumstances in which it would be impossible to have a presentation. According to the DOJ, this included fishing trips off the Florida coast and meetings in Hooters restaurants. NPC is also accused of treating health care professionals to expensive dinners. The payments and dinners were apparently kickbacks to the doctors for writing prescriptions for NPC drugs.

Doctors in the Sunshine State Allegedly Involved.

The lawsuit alleges at least six Florida doctors of participating in the bogus conferences and taking thousands of dollars in kickbacks, according to the Tampa Bay Times. The doctors are not named or charged in the civil lawsuit.

To read the allegations listed in the lawsuit against Florida doctors, click here for the Tampa Bay Times article.

Novartis Claims Discounts and Physician Speaker Programs Were Legitimate.

In a press release, NPC disputes all of the government’s allegations. The pharmaceutical company states that discounts and rebates by pharmaceutical companies are a customary and legal procedure, as recognized by the government. It also addresses the physician speaker programs by saying the programs are also acceptable practices designed to inform physicians about the uses of different types of medicines. Click here to read the entire press release from NPC.

Kickbacks and The Law.

For years drug companies have paid doctors to speak about new drugs at educational conferences with other health care professionals. The practice is legal, but considered questionable.

Under the Anti-Kickback Statute, it’s a felony for health care professionals to accept bribes in exchange for recommending a drug or service covered by Medicare, Medicaid, TRICARE or the Department of Veterans Affairs health care program.

Whistleblower or Qui Tam Lawsuits Can Results in a Big Pay Day.

The original complaint against NPC was allegedly filed under the qui tam, or whistleblower, provisions of the False Claims Act by a former sales representative.

Individuals working in the health care industry, whether for hospitals, pharmacies, nursing homes, medical groups, home health agencies or others, often become aware of questionable activities.  Often they are even asked to participate in it. In many cases the activity may amount to fraud on the government.

In a two-part blog series on whistleblower/qui tam lawsuits I explain types of false claims, the reward programs for coming forward with a false claim, who can file a whistleblower/qui tam lawsuit, and more. Click here to read the first part of this blog, and click here for the second part.

The Health Law Firm Lawyers are Experienced with Qui Tam or Whistleblower Cases.

Attorneys with The Health Law Firm represent plaintiffs, patients, health care professionals and health facilities in qui tam or whistleblower cases. We have developed relationships with recognized experts in health care accounting, health care financing, utilization review, medical review, filling, coding, and other services that assist us in such matters.

To contact The Health Law Firm, please call (407) 331-6620 or (850) 439-1001 and visit our website at www.TheHealthLawFirm.com.

Sound Off.

Have you head about these two lawsuits? What are your thoughts? Please leave any thoughtful comments below.

Sources:

Masow, Julie. “Novartis Pharmaceuticals Corporation Disputes Allegations in Two US Government Lawsuits and Looks Forward to a Fair Discussion of the Facts.” Novartis Pharmaceuticals. (April 26, 2013). From: http://www.pharma.us.novartis.com/newsroom/pressreleases/137176.shtml

Davis, Brittany Alana. “Lawsuit: Pharmaceutical Company Gave Kickbacks to Florida Doctors.” Tampa Bay Times. (May 3, 2013). From: http://www.tampabay.com/news/courts/lawsuit-pharmaceutical-company-gave-kickbacks-to-florida-doctors/2119133

Department of Justice. “United States Files Complaint Against Novartis Pharmaceuticals Corp. for Allegedly Paying Kickbacks to Doctors in Exchange for Prescribing Its Drugs.” Department of Justice. (April 26, 2013). From: http://www.justice.gov/opa/pr/2013/April/13-civ-481.html

About the Author: George F. Indest III, J.D., M.P.A., LL.M., is Board Certified by The Florida Bar in Health Law.  He is the President and Managing Partner of The Health Law Firm, which has a national practice.  Its main office is in the Orlando, Florida, area.  www.TheHealthLawFirm.com  The Health Law Firm, 1101 Douglas Ave., Altamonte Springs, FL 32714, Phone: (407) 331-6620.

The Health Law Firm” is a registered fictitious business name of George F. Indest III, P.A. – The Health Law Firm, a Florida professional service corporation, since 1999.Copyright © 1996-2012 The Health Law Firm. All rights reserved.
Advertisements

Supreme Court to Determine if Pay-for-Delay Agreements Between Brand and Generic Drug Manufacturers are Legal

7 Indest-2008-4By George F. Indest III, J.D., M.P.A., LL.M., Board Certified by The Florida Bar in Health Law

The Supreme Court is currently looking into whether brand name drug manufacturers may pay generic drug manufacturers to keep the generic drugs off the market. These payments, often called pay-for-delay, are usually a form of settlement between the two manufacturers in patent litigation. The Supreme Court’s decision may be worth billions to pharmaceutical companies and consumers.

In January 2013, the American Medical Association (AMA) teamed up with the American Association of Retired Persons (AARP) and other organizations seeking to eliminate pay-for-delay agreements. The groups filed a friend-of-the-court brief in the Supreme Court case.

Click here to read the friend-of-the-court brief.

History of Pay-For-Delay Agreements.

Pay-for-delay agreements came as the result of the Drug Price Competition and Patent Term Restoration Act of 1984, also known as the Hatch-Waxman Act. The Hatch-Waxman Act gives generic drug manufacturers an incentive to challenge brand name drug patents because the first generic drug manufacturer to received U.S. Food and Drug Administration (FDA) approval to launch a generic copy of a brand name drug can receive a 180-day marketing exclusivity period for the product. The FDA cannot approve any other generic applications for the same drug until the first-to-file generic manufacturer has sold its product for 180 days or has given up its exclusivity period. Click here to read the Hatch-Waxman Act.

Brand name manufacturers often challenge generic drug manufacturers who try to sell their product prior to patent expiration. This results in litigation to determine whether the generic manufacturer is violating the brand name manufacturer’s patents.

Instead of going to court over this, brand name manufacturers often choose to pay a settlement to the generic drug manufacturers for agreeing to delay the launch of its competing product.

The Impact of Pay-For-Delay Agreements.

It’s been found that pay-for-delay agreements can delay a generic drug almost 17 months before it can be put on the market. In the meantime, patients must pay higher prices for the brand name version. This also impacts Medicare and Medicaid programs.

According to an article on National Public Radio (NPR), the number of pay-for-delay agreements is increasing. Click here to read the entire NPR article.

Legalized Extortion Causes Patients to Pay High Drug Prices.

This type of legalized extortion does nothing more than drive up drug prices for all patients by keeping generic drugs off the market. On the other hand, it vastly increases the profits made by big name pharmacy companies who are able to derive even more money from expired patents.

AMA Fights to Get Rid of Pay-for-Delay Agreements.

According to a press release, AMA, AARP, the National Legislative Association for Prescription Drug Prices and the U.S. Public Interest Research Groups all signed onto the friend-of-the-court brief filed in the Supreme Court.

The AMA is concerned that pay-for-delay agreements extend patent monopolies, increase health care costs and restrict doctors’ ability to treat patients. To read the entire press release from the AMA, click here.

Contact Health Law Attorneys Experienced in Representing Pharmacies and Pharmacists.

The Health Law Firm represents pharmacists and pharmacies in investigations, regulatory matters, licensing issues, litigation, inspections and audits. The firm’s attorneys include those who are board certified by The Florida Bar in Health Law as well as licensed health professionals who are also attorneys.

To contact The Health Law Firm please call (407) 331-6620 or (850) 439-1001 and visit our website at www.TheHealthLawFirm.com.

Comments?

As a health care professional, how do you feel about pay-for-delay agreements? Please leave any thoughtful comments below.

Sources:

Mills, Robert. “AMA Joins Other Groups Seeking to Overturn Pay-for-Delay Drug Agreement.” American Medical Association. (January 30, 2013). From: http://www.ama-assn.org/ama/pub/news/news/2013-01-30-amicus-brief-ftc-vs-watson-pharmaceuticals.page

Federal Trade Commission v. Watson Pharmaceuticals, Inc. Case Number 12-416. Brief for AARP, American Medical Association, National Legislative Association for Prescription Drug Prices and U.S. Public Interest Research Groups as Amici Curiae in Support of Petitioner. January 29, 2013. From: http://www.thehealthlawfirm.com/uploads/2013-01-29-amicus-brief-ftc-vs-watson-pharmaceuticals.pdf

Purvis, Leigh. “Pay-for-Delay Agreements and Prescription Drug Costs.” AARP. (May 13, 2013.) From: http://blog.aarp.org/2013/05/13/pay-for-delay-agreements-and-prescription-drug-costs/

Totenberg, Nina. “Supreme Court Hears ‘Pay to Delay’ Pharmaceutical Case.” National Public Radio. (March 25, 2013). From: http://www.npr.org/2013/03/25/175043758/supreme-court-hears-pay-to-delay-pharmaceutical-case

About the Author: George F. Indest III, J.D., M.P.A., LL.M., is Board Certified by The Florida Bar in Health Law. He is the President and Managing Partner of The Health Law Firm, which has a national practice. Its main office is in the Orlando, Florida, area. www.TheHealthLawFirm.com The Health Law Firm, 1101 Douglas Ave., Altamonte Springs, FL 32714, Phone: (407) 331-6620.

“The Health Law Firm” is a registered fictitious business name of George F. Indest III, P.A. – The Health Law Firm, a Florida professional service corporation, since 1999.

Copyright © 1996-2012 The Health Law Firm. All rights reserved.

Florida’s Medicaid Program Receives Settlement Payment from Pharmaceutical Company

4 Indest-2009-3By George F. Indest III, J.D., M.P.A., LL.M., Board Certified by The Florida Bar in Health Law

The Florida Attorney General’s (AG) Medicaid Fraud Control Unit (MFCU), 46 other states and the federal government reached a $48 million agreement with pharmaceutical company Healthpoint Ltd., on February 25, 2013. According to the Florida AG, the settlement is in response to allegations of misrepresenting the regulatory status of an ointment used to treat skin conditions and submitting false Medicaid claims. Florida’s Medicaid program will receive almost $900,000 of the settlement.

Click here to see the press release from the AG’s office.

Pharmaceutical Company Allegedly Submitted False Claims to Medicaid.

According to the Department of Justice (DOJ), Healthpoint launched the ointment for the treatment of nursing home patients with bed sores. The settlement resolves allegations that Healthpoint marketed the ointment, Xenaderm, without the approval of the Food and Drug Administration (FDA) by modeling it on a pre-1962 drug that the FDA never reviewed. The DOJ states that the main ingredient in Xenaderm was determined by the FDA to be less-than-effective for its intended use. The government contends those determinations render the ointment ineligible for Medicaid reimbursements. Healthpoint is accused of knowingly submitting false claims to Medicaid programs.

To read the press release on the settlement from the DOJ, click here.

The settlement is th result of litigation by the United States Attorney’s Office for the District of Massachusetts, the DOJ and fifteen (15) states, including Florida.

Responding to a Medicaid Audit.

Should you find yourself, your facility or your health practice the subject of a Medicaid audit by your state Medicaid agency or audit contractor, there are a few things you should know.

The most important thing is that just because you are being audited, it does not mean that you or your business has done anything wrong. State and federal governments conduct audits for many different reasons. Typical ones include: special audits of high-fraud geographic areas, auditing of particular billing codes, randomly selected provider auditing, and complaints of possible fraud.

Click here to see a complete list of steps you should take in order to compile and provide a set of records that will best serve to help you avoid any liability at the conclusion of the audit process.


Contact Health Law Attorneys Experienced in Handling Medicaid Audits, Investigations and other Legal Proceedings.


Medicaid fraud is a serious crime and is vigorously investigated by the state MFCU, the Agency for Healthcare Administration (AHCA), the Zone Program Integrity Contractors (ZPICs), the FBI, the Office of Inspector General (OIG) of the U.S. Department of Health and Human Services (DHHS). Often other state and federal agencies, including the U.S. Postal Service (USPS), and other law enforcement agencies participate. Don’t wait until it’s too late. If you are concerned of any possible violations and would like a confidential consultation, contact a qualified health attorney familiar with medical billing and audits today. Often Medicaid fraud criminal charges arise out of routine Medicaid audits, probe audits, or patient complaints.

The Health Law Firm’s attorneys routinely represent physicians, dentists, orthodontists, medical groups, clinics, pharmacies, assisted living facilities (AFLs), home health care agencies, nursing homes, group homes and other healthcare providers in Medicaid and Medicare investigations, audits and recovery actions. We also represent health professionals and others who know of Medicare and Medicaid fraud to file whistleblower and qui tam cases.

To contact The Health Law Firm please call (407) 331-6620 or (850) 439-1001 and visit our website at www.TheHealthLawFirm.com.

Comments?

What do you think of this settlement agreement? Please leave any thoughtful comments below.

Sources:

Meale, Jenn. “Attorney General Bondi’s Office Reaches Settlement with Pharmaceutical Company.” Florida Office of the Attorney General. (February 25, 2013). From: http://www.myfloridalegal.com/newsrel.nsf/newsreleases/D69C285712F6FF9185257B1D004D275D

Department of Justice. “Healthpoint Ltd. to Pay up to $48 Million for False Medicaid and Medicare Claims for Unapproved Prescription Drug.” Department of Justice. (December 6, 2013). From: http://www.justice.gov/opa/pr/2012/December/12-civ-1459.html

About the Author: George F. Indest III, J.D., M.P.A., LL.M., is Board Certified by The Florida Bar in Health Law. He is the President and Managing Partner of The Health Law Firm, which has a national practice. Its main office is in the Orlando, Florida, area. www.TheHealthLawFirm.com The Health Law Firm, 1101 Douglas Ave., Altamonte Springs, FL 32714, Phone: (407) 331-6620.

The Health Law Firm” is a registered fictitious business name of George F. Indest III, P.A. – The Health Law Firm, a Florida professional service corporation, since 1999.

Copyright © 1996-2012 The Health Law Firm. All rights reserved.

Florida Pharmacy Owner Admits to $23 Million Health Care Fraud Scheme

5 Indest-2008-2By George F. Indest III, J.D., M.P.A., LL.M., Board Certified by The Florida Bar in Health Law

A co-owner and operator of three Miami-area pharmacies pleaded guilty on December 6, 2012, for his part in a $23 million health care fraud scheme. The pharmacy owner allegedly admitted in the Florida Southern Federal District Court to one count of conspiracy to commit health care fraud and one count of conspiracy to pay illegal health care kickbacks, according to a Department of Justice (DOJ) press release.

Click here to read the entire press release from the DOJ.

Pharmacy Owner and Co-Conspirators Used a Network of Beneficiaries to Bill Medicare and Medicaid.

According to court documents, the pharmacy owner allegedly admitted to paying illegal kickbacks to an unnamed number of co-conspirators in return for Medicare and Medicaid beneficiary information. That information was then used to submit fraudulent claims. A majority of the beneficiaries referred to the owner’s pharmacies reportedly resided at assisted living facilities (ALFs) in Miami.

The court documents state that the pharmacy owner also allegedly paid kickbacks to physicians in exchange for prescription referrals which were also billed to Medicare.

Unused and Partially Used Medications Were Also Allegedly Used in Scheme.

As part of the scheme, the pharmacy owner allegedly instructed drivers working for his pharmacies to pick up unused medications from ALFs around Miami. The medications were then allegedly placed back into pill bottles. Unused and partially used medications were billed back to Medicare and Medicaid, according to court documents.

Click here to read the court documents on this case.

The pharmacy owner and his co-conspirators allegedly submitted more than $23 million in false and fraudulent claims to Medicare and Florida Medicaid programs.

Don’t Wait Until It’s Too Late; Consult with a Health Law Attorney Experienced in Medicare and Medicaid Issues Now.

The attorneys of The Health Law Firm represent healthcare providers in Medicare audits, ZPIC audits and RAC audits throughout Florida and across the U.S. They also represent physicians, medical groups, nursing homes, home health agencies, pharmacies, hospitals and other healthcare providers and institutions in Medicare and Medicaid investigations, audits, recovery actions and termination from the Medicare or Medicaid Program.

For more information please visit our website at www.TheHealthLawFirm.com or call (407) 331-6620 or (850) 439-1001.

Comments?

What do you think of this case? Is the Miami area just a hotbed for Medicare and Medicaid schemes? Please leave any thoughtful comment below.

Sources:

United States of America v. Jose Carlos Morales. Case Number 12-23374, Preliminary Injunction and Supporting Memorandum of Law. (September 14, 2012). From: http://www.thehealthlawfirm.com/uploads/USA%20v%20Morales.pdf

Department of Justice. “Pharmacy Owner Pleads Guilty in Miami for Role in $23 Million Health Care Fraud Scheme.” Department of Justice . (December 6, 2012). From: http://www.justice.gov/opa/pr/2012/December/12-crm-1461.html

About the Author: George F. Indest III, J.D., M.P.A., LL.M., is Board Certified by The Florida Bar in Health Law.  He is the President and Managing Partner of The Health Law Firm, which has a national practice.  Its main office is in the Orlando, Florida, area.  www.TheHealthLawFirm.com  The Health Law Firm, 1101 Douglas Ave., Altamonte Springs, FL 32714, Phone:  (407) 331-6620.

“The Health Law Firm” is a registered fictitious business name of George F. Indest III, P.A. – The Health Law Firm, a Florida professional service corporation, since 1999.

Copyright © 1996-2012 The Health Law Firm. All rights reserved.

Key West Pharmacy Blows Whistle on Medicaid Fraud and Comes Out on Top

By Danielle M. Murray, J.D.

On September 27, 2012, Public Citizen, a watchdog group, reported whistleblowers have initiated $6.6 billion in penalties against drug manufacturers in 2012. Most of these penalties are for fraudulently overcharging government programs. The report names a small Key West, Florida, pharmacy as one of the top whistleblowers in the country. The pharmacy noticed and reported that drug manufacturers were charging highly inflated prices to Medicaid.

To read the entire report on from Public Citizen, click here.

Whistleblowing Can Pay Off Big.

The study shows that the government collected billions of dollars, just in 2012, as a result of whistleblower efforts.

For whistleblowers such as the Key West pharmacy, helping the government fight fraud has its rewards. According to the Miami Herald, the government collected an estimated $1.3 to $2.5 billion dollars thanks to the pharmacy. As a reward for its whistleblowing, the government gave the pharmacy an estimated $340 million dollars.

Click here to read the Miami Herald article.

One major victory was in 2012, the pharmacy won a settlement with Boehringer Ingelheim, a large pharmaceutical company, for $289 million for overcharging government health programs for various drugs.

To read the entire whistleblower complaint file, click here.

States Low on Funds Take Closer Look at Medicaid Fraud.

It’s no surprise that states are short of funds to pay for Medicaid. As a result, fraud enforcement is increasing, in hopes that the recoveries will make up that deficit. According to studies, states that have elected to enforce whistleblower claims against the pharmaceutical industries have found that the outcome pays for the cost of enforcement.

How This Affects Providers.

If states find that fraud recovery produces large results, they will increase their efforts in other areas besides the pharmaceutical industry. This could result in additional audits against individual providers, with states hopeful that they will uncover overpayments and other problems that would allow recoupment of funds. In fact, this is already happening in some areas, and the auditors are actually incentivized to find mistakes that providers make.

Faced with an Medicaid Audit? Contact Health Law Attorneys Experienced in Handling Medicaid Audits.

Medicaid fraud is a serious crime and is vigorously investigated by the state MFCU, the Agency for Healthcare Administration (AHCA), the Zone Program Integrity Contractors (ZPICs), the FBI, the Office of Inspector General (OIG) of the U.S. Department of Health and Human Services (DHHS). Often other state and federal agencies, including the U.S. Postal Service (USPS), and other law enforcement agencies participate. Don’t wait until it’s too late. If you are concerned of any possible violations and would like a confidential consultation, contact a qualified health attorney familiar with medical billing and audits today.  Often Medicaid fraud criminal charges arise out of routine Medicaid audits, probe audits, or patient complaints.

The Health Law Firm’s attorneys routinely represent physicians, medical groups, clinics, pharmacies, assisted living facilities (AFLs), home health care agencies, nursing homes, group homes and other healthcare providers in Medicaid and Medicare investigations, audits and recovery actions.

To contact The Health Law Firm please call (407) 331-6620 or (850) 439-1001 and visit our website at www.TheHealthLawFirm.com.

Comments?


Like this story? Don’t like it? Any Comments? Please submit any
thoughtful comments below.

Sources:

Dorschner, John. “Key West Pharmacy Top Whistle-Blower.” Miami Herald.(September 27, 2012). From: http://www.miamiherald.com/2012/09/27/3023894/key-west-pharmacy-top-whistleblower.html

About the Author: Danielle M. Murray is an attorney with The Health Law Firm, which has a national practice. Its main office is in the Orlando, Florida, area.  www.TheHealthLawFirm.com  The Health Law Firm, 1101 Douglas Ave., Altamonte Springs, FL 32714, Phone: (407) 331-6620.

“The Health Law Firm” is a registered fictitious business name of George F. Indest III, P.A. – The Health Law Firm, a Florida professional service corporation, since 1999.

Copyright © 1996-2012 The Health Law Firm. All rights reserved.