On March 18, 2020, the Connecticut Department of Public Health (DPH) issued an order requiring laboratories to report negative SARS-CoV-2 test results to DPH using the Electronic Laboratory Reporting System. DPH indicated the immediate reporting of such results is necessary for public health purposes.
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Life Sciences
Government Continues to Closely Scrutinize Pharmaceutical Marketing Practices
On September 4, 2019, the Department of Justice (DOJ) announced a $15.4 million settlement with pharmaceutical company Mallinckrodt ARD LLC (Mallinckrodt) to resolve alleged violations of the Anti-Kickback Statute (AKS) in two whistleblower suits filed under the False Claims Act (FCA). The settlement addresses allegations of AKS violations between 2009-2013 by sales representatives of a company later acquired by Mallinckrodt via the “wining and dining” of physicians to induce Medicare prescriptions of that company’s drug. Interestingly, the settlements do not cover related allegations within those FCA suits that Mallinckrodt improperly used a patient assistance foundation to “pay illegal kickbacks in the form of copay subsidies” for the same drug.…
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AdvaMed Revises Code of Ethics on Interactions with Health Care Professionals
The Advanced Medical Technology Association (AdvaMed) has revised its U.S. Code of Ethics for Interactions with Health Care Professionals, with updates that take effect January 1, 2020. Until then, the current AdvaMed Code remains in effect.
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Department of Justice Announces Significant False Claims Act Settlements Tied to Electronic Health Records Arrangements
By Conor Duffy on
Posted in Accreditation, Department of Justice, False Claims Act, Fraud and Abuse, Government Enforcement, Health Information Exchanges and Electronic Medical Records (EMRs), Health Information Technology, Healthcare Technology, Hospitals and Health Systems, Life Sciences, Medicare and Medicaid, Office of Inspector General, Physicians and Allied Health Professionals, Reimbursement, Stark Law
The Department of Justice (DOJ) recently announced two high-dollar False Claims Act (FCA) enforcement actions involving allegedly fraudulent arrangements tied to the implementation and use of electronic health record systems (EHRs). The respective settlements enable recovery by DOJ of over $100 million, and immediately precede the government’s recent proposal of new rules to promote the interoperability of EHRs. The settlements thus serve as an important reminder of the importance of adhering to federal fraud and abuse laws and regulations as hospitals and other health care providers continue to implement EHR technology.…
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HHS Proposes to Amend AKS Safe Harbors to Exclude PBM Rebates and Incentivize Consumer Drug Discounts
On February 6, 2019, the Department of Health and Human Services (HHS) Office of Inspector General (OIG) published a proposed rule (Proposed Rule) that would amend the safe harbor regulations under the Federal Anti-Kickback Statute. The Proposed Rule is intended to “address the modern prescription drug distribution model” and make sure that the safe harbors “extend only to arrangements that present a low risk of harm to the Federal health care programs and beneficiaries.” Specifically, in the Proposed Rule OIG proposes to alter the definition of “discounts” under the so-called “discounts safe harbor” at 42 C.F.R. § 1001.952(h) to exclude from protection any reductions in price or other remuneration offered by pharmaceutical drug manufacturers to pharmacy benefit managers (PBMs), Part D plan sponsors, or Medicaid managed care organizations. Additionally, the Proposed Rule proposes and solicits comment on two new safe harbor provisions: one aimed at reducing the price of pharmaceuticals where reductions in price are reflected at the point of sale to a beneficiary, and a second that would protect certain fixed fee services arrangements between manufacturers and PBMs.…
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OIG Advisory Opinion No. 19-02 Allows Pharmaceutical Manufacturer to Temporarily Loan Smartphones to Financially Needy Patients to Receive Data from a Digestible Medication Sensor
On January 24, 2019, the Office of Inspector General (“OIG”) issued a favorable advisory opinion allowing a pharmaceutical manufacturer (“Manufacturer”) to temporarily loan limited-functionality smartphones to financially needy patients who lack the required technology to receive adherence data from a sensor embedded in a prescribed antipsychotic medication (“the Arrangement”). The OIG concluded that the Arrangement did not constitute grounds for penalties under the Civil Monetary Penalties law (“CMP”) and that although the Arrangement could potentially cause remuneration under the Anti-Kickback Statute (“AKS”), the OIG would not impose sanctions on the Manufacturer as related to the Arrangement based on the low-risk nature of the Arrangement.…
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CMS Proposes Revised Prescription Drug Regulations to Lower Drug Prices and Reduce Out of Pocket Expenses
The Centers for Medicare and Medicaid Services (CMS) announced a Proposed Rule to amend Medicare Advantage (MA) regulations and Prescription Drug Benefit program (Part D) regulations. The Proposed Rule was published on November 30, 2018. The Proposed Rule is intended to help lower drug prices for health and drug plans and reduce out-of-pocket costs for MA and Part D enrollees. Major provisions include: Providing Plans with increased flexibility in managing drug formularies. Current policy requires Part D formularies to include all drugs in the following categories: (1) antidepressants; (2) antipsychotics; (3) anticonvulsants; (4) immunosuppressants for treatment of transplant rejection; (5) antiretrovirals; and (6) antineoplastics; except in limited circumstances. The Proposed Rule includes three exceptions, allowing: (1) broader use of prior authorization and step therapy; (2) exclusion of drugs that are only a new formulation of an existing single-source drug or biological product, regardless of whether the older formulation remains on the market; and (3) exclusion of drugs with a price increase beyond an inflation-based threshold relative to a baseline month and year.
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FDA Approves Marijuana-Derived, CBD-Containing Drug Epidiolex to Treat Certain Epilepsy-Associated Seizures
On June 25, 2018, the U.S. Food and Drug Administration approved Epidiolex, an orally administered drug derived from the marijuana plant, Cannabis sativa. The drug is approved for use for patients two years and older, for the treatment of seizures associated with Lennox-Gastaut syndrome and Dravet syndrome, both of which are rare and severe forms of epilepsy. It is the first drug that FDA has approved for Dravet patients.…
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Massachusetts Files Suit Against Connecticut-Based Purdue Pharma for Opioid Related Harms
By Nawa Lodin on
On June 13, 2018, Attorney General Maura Healey filed a complaint in Massachusetts Superior Court on behalf of the Commonwealth against Purdue Pharma Inc. and Purdue Pharma L.P., Connecticut-based drug companies that manufacture and market OxyContin. The lawsuit also names sixteen individual defendants, including current and former CEOs and certain members of the board of Purdue Pharma Inc. This is not the first time a Purdue Pharma company has been accused of wrongdoing with respect to the marketing of opioids. In 2007, Purdue Frederick Company (an affiliate of Purdue Pharma L.P.) paid nearly $700 million dollars in fines and plead guilty to criminal charges, admitting that, with the intent to defraud or mislead, it marketed and promoted its drugs as less addictive and less subject to abuse.…
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DOJ Announces Criminal Conviction of Physician for HIPAA Violation
On April 30, 2018 a Massachusetts physician was convicted of a criminal violation of the Health Insurance Portability and Accountability Act of 1996 (HIPAA), as well as one count of obstruction of a criminal health care investigation, in a Massachusetts federal court. The convictions relate to the purported sharing of confidential patient information by the physician with pharmaceutical sales representatives that allowed the pharmaceutical company to target patients with specific conditions (and to correspondingly facilitate the receipt of prior authorizations for the company’s drugs from patients’ insurers).…
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