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AG Stein Announces $273,000 Settlement with Pharmaceutical and Laboratory Companies

March 23, 2017

RALEIGH, NC – Attorney General Josh Stein announced today that North Carolina has settled allegations against Forest Laboratories LLC, and Forest Pharmaceuticals Inc., (“Forest”). Forest violated the anti-kickback statute, which prohibits providing payment and rewards to induce referrals of items or services covered by federal health care programs. These incentives include providing payments and meals to physicians in connection with speaker programs about Bystolic®, Savella®, or Namenda®, between January 1, 2008 and December 31, 2011.

“ACA has yet to deliver on the promise of paying for itself by preventing fraud,” comments John Benson, CEO of Verisys Corporation, “and whatever replaces it is not going to eliminate continuing huge losses attributed to system flaws that allow for massive dollars lost to waste, abuse and fraud in the health care system. Verisys has the knowledge and experience to deliver solutions that prevent fraud and limit its impact by implementing gatekeeping and monitoring solutions as opposed to pay and chase.”

“Medical costs are growing and kickbacks like these drive up consumer costs,” said Stein. “These companies are encouraging physicians to prescribe certain medications to line both the pharmaceutical companies’ and the physicians’ pockets. Patient care, not financial gain, should be a physician’s top priority.”

The State contends that the payments and meals were intended to induce physicians to prescribe the named drugs because:

  • the physician made a presentation when there were no licensed health care professionals in attendance;
  • the physician made a presentation to attendees, including in some cases the physician’s colleagues or staff members who, over a short period of time, attended multiple presentations about the same drug;
  • the meals associated with the presentations at times exceeded Forest’s own internal cost limitations; or
  • the physician did not actually make a presentation either because the program was cancelled (and there is no record of a reason for the cancellation) or because no attendees appeared.

As a result of the $38 million settlement, the federal government will receive $35.5 million and state Medicaid programs will receive $2.5 million. Of that, North Carolina will receive $273,586.62 in restitution and other recovery.

The source of this article: http://www.ncdoj.gov/News-and-Alerts/News-Releases-and-Advisories/Press-Releases/AG-Stein-Announces-$273,000-Settlement-with-Pharma.aspx

Juliette Willard Written by Susen Sawatzki
Healthcare Industry Expert
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