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Pfizer to pay $23.8M to resolve US kickback probe

Pfizer to pay $23.8M to resolve US kickback probe

(Reuters) — Pfizer Inc. agreed to pay $23.8 million to resolve U.S. government charges that the drugmaker used a purportedly independent charity to pay illegal kickbacks to Medicare patients covering their out-of-pocket drug costs.

The U.S. Department of Justice said on Thursday that the civil settlement resolves allegations that Pfizer improperly used the Patient Access Network Foundation as a conduit to cover co-payment obligations of patients taking three Pfizer drugs.

Pfizer's actions enabled the New York-based drugmaker to boost prices and revenue, violating the federal False Claims Act in a scheme that ran from 2012 to 2016, the DOJ said.

The accord resulted from an industrywide probe led by the office of U.S. Attorney Andrew Lelling in Boston of drugmakers' support of patient assistance charities.

"Kickbacks undermine the independence of physician and patient decision-making, and raise health care costs," Chad Readler, the acting assistant attorney general of the Justice Department's civil division, said in a statement.

Pfizer said the settlement reflects its "desire to put this legal matter behind it and focus on the needs of patients. The company believes all individuals deserve access to medicines prescribed by their physicians."

The company also entered a five-year corporate integrity agreement with the Office of Inspector General of the U.S. Department of Health and Human Services.

Drugmakers are prohibited from subsidizing co-payments for patients enrolled in Medicare, but may donate to independent non-profits that provide such assistance.

Pfizer was accused of working with a third-party specialty pharmacy, Advanced Care Scripts, to move patients taking its renal cell carcinoma drugs Sutent and Inlyta to the foundation, rather than provide the drugs for free to qualified patients.

The government also accused Pfizer of working with the foundation to create a fund for patients taking its arrhythmia drug Tikosyn, and coordinating the opening of the fund with a price hike.

Neither the foundation nor Advanced Care Scripts, which is now part of CVS Health Corp., immediately responded to requests for comment.

In December, United Therapeutics Corp. reached a $210 million settlement to resolve similar allegations over its alleged improper use of a charity to cover co-payments.

On May 8, Jazz Pharmaceuticals P.L.C. said it would pay $57 million in another accord.

The False Claims Act bans drugmakers from offering anything of value to induce Medicare patients to buy their drugs.



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