On March 30, 2022, the United States Department of Justice (DOJ) announced that Manual J. Bojorquez, the owner of a marketing company, was sentenced to 36 months’ probation and ordered to pay restitution of $3.3 million for his role in a kickback scheme. The sentencing follows a plea agreement by Mr. Bojorquez in which he pleaded guilty to conspiracy to violate the federal anti-kickback statute. According to the DOJ and court documents, Mr. Bojorquez, through his company, provided marketing services to various compounding pharmacies. Mr. Bojorquez’s company conspired with the compounding pharmacies to pay kickbacks to physicians in exchange for those physicians referring prescriptions to the compounding pharmacies. The compounding pharmacies then paid Mr. Bojorquez (through various shell companies) a percentage (approximately 45%) of the fees generated from the prescriptions referred by the physicians. The pharmacies billed and received payment from the US Department of Labor’s (DOL) Office of Workers Compensation Program, which is a federal health care benefit program. Over the course of the conspiracy, the DOL paid over $8 million for the kickback-induced prescriptions.
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DOJ Announces $3.8 Million Settlement to Resolve Allegations of False Claims Act and Anti-Kickback Statute Violations
By Nathaniel Arden & Guest Contributor on
On February 9, 2022, the United States Department of Justice (DOJ) announced a $3.8 million settlement with Catholic Medical Center (CMC) of Manchester, New Hampshire. This settlement resolves allegations that CMC violated the False Claims Act (FCA) and federal Anti-Kickback Statute (AKS). The allegations were originally brought in a qui tam lawsuit filed by a physician who is a former employee of CMC.
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DOJ Reaches Settlement with Patient Assistance Foundation Resolving Allegations of FCA Violations
On January 21, 2020, the Department of Justice (DOJ) announced a $3 million settlement with Patient Services, Inc. (PSI) to resolve allegations of False Claims Act (FCA) violations. The DOJ alleged that PSI enabled three pharmaceutical companies to pay kickbacks to patients by funneling money to patients taking drugs manufactured by those same pharmaceutical companies. In addition to the $3 million, PSI has entered into a three-year integrity agreement with Health and Human Services’s Office of the Inspector General. The settlement involved no determination of liability.
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DOJ Reaches $21.36 Million Agreement with Compounding Pharmacy, Two of its Executives, and Managing Private Equity Firm to Resolve FCA Allegations
On September 18, 2019, the Department of Justice (DOJ) announced a $21.36 million settlement with compounding pharmacy Patient Care America (PCA), as well as PCA’s Chief Executive, PCA’s former Vice President of Operations, and a private equity firm (PE Firm) that managed PCA on behalf of investors. The settlement resolves a False Claims Act (FCA) lawsuit alleging involvement in a kickback scheme designed to generate unnecessary referrals for prescription pain creams, scar creams, and vitamins reimbursed by TRICARE, the federal health care program for military members and their families. No determination of liability was made as part of the settlement. See our prior analysis of DOJ’s intervention in this case here.
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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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OIG Advisory Opinion Allows PHO Network Hospitals to Give 100% Discount on Medigap-Covered Inpatient Deductibles, with Savings Shared as a Premium Credit to Patients
The Office of Inspector General (OIG), Health and Human Services, issued an Advisory Opinion allowing an arrangement between a licensed offeror of Medicare Supplemental Health Insurance policies (Medigap Offeror) and a preferred hospital organization (PHO) having network hospitals across the U.S. (the “Arrangement”). Under the Arrangement, the PHO’s network hospitals would provide discounts of up…
OIG Posts Telemedicine Advisory Opinion
The Office of Inspector General (OIG), Health and Human Services issued an Advisory Opinion allowing an arrangement proposed by a federally qualified health center look-alike (FQHC look-alike) to provide free technology items and services to a clinic run by a county Department of Health (County Clinic), that would facilitate telemedicine encounters (the Arrangement). Although the OIG found that the Arrangement could potentially implicate the anti-kickback statute (AKS), the OIG concluded that it would not impose administrative sanctions.
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