Drugmaker to settle US charity probe for $52.6 million

(Reuters) — Danish drugmaker Lundbeck said on Wednesday that it will pay $52.6 million to resolve a U.S. probe into its financial support of patient assistance charitable foundations.

The company, formally called H. Lundbeck A/S, said it had reached an agreement with the U.S. Justice Department, which has investigating drugmakers’ support of charities that help Medicare patients cover out-of-pocket drug costs.

Lundbeck, which develops and distributes drugs for neurological and psychological diseases such as depression and Alzheimer’s, said the settlement would include no admission of wrongdoing and is subject to further negotiation.

Drug companies are prohibited from subsidizing copayments for patients enrolled in the Medicare government health care program for the elderly. But companies may donate to nonprofits providing copay assistance as long as they are independent.

The U.S. Attorney’s Office in Massachusetts has been leading the industrywide investigation. A spokeswoman for the office declined to comment.

The probe most recently resulted in Pfizer Inc. on May 25 agreeing to pay $23.85 million to resolve claims that it used a purportedly independent charity as a conduit to pay illegal kickbacks to Medicare patients.

In December, United Therapeutics Corp. reached a $210 million settlement to resolve similar allegations it improperly used a charity to cover copayments.

Jazz Pharmaceuticals P.L.C. announced on May 8 that it had reached an agreement to pay $57 million to resolve a related investigation.