Pharmaceutical Fraud: Off-Label Promotion, Pricing and Kickbacks

Off-label promotion

A physician may prescribe off-label. A manufacturer may not promote off-label, and a federal program is not required to pay for a use outside the medically accepted indications.

When a manufacturer builds a commercial strategy around an unapproved use, trains its sales force to promote it, and the resulting prescriptions are billed to Medicare, Medicaid, or TRICARE, the claims are false and the manufacturer caused their submission.

Government pricing fraud

Manufacturers must report pricing data that determines what federal programs pay and what rebates are owed. Misreporting it is a distinct and substantial category of case.

• Understating best price to reduce Medicaid rebate obligations
• Misclassifying a brand drug as generic under the rebate program
• Failing to include discounts, rebates, and fees in average manufacturer price
• Reporting inflated average wholesale price to widen the provider spread
• Misreporting 340B eligibility and duplicate discounts

Payments to prescribers

Speaker programs, advisory boards, consulting agreements, preceptorships, and research grants are all legitimate in principle and all recur in enforcement.

The tells are consistent: honoraria above fair market value, speakers selected by prescribing volume, programs with thin or repeat attendance, and content that never changes. Sales representatives see all of this directly and are frequently the relators.

Our result in this area

Our attorneys obtained a 9 million dollar settlement in a non-intervened case involving Subsys, a sublingual fentanyl product approved only for breakthrough cancer pain in opioid-tolerant adults, dispensed for off-label and non-medically necessary uses billed to Medicare, Medicaid, and TRICARE.

The case reached a private equity owner and its principals personally. The government did not intervene and the case was carried anyway.