Presented by: Presented by: John R. Kamp, PhD, JD John R. Kamp, PhD, JD Judith G. Ribble, PhD Judith G. Ribble, PhD The webinar will begin shortly. The webinar will begin shortly. If you need technical assistance please email us at [email protected]. The primary means of listening to this session is via streaming audio, if you are unable to access streaming audio please dial (800) 214-0694 and enter 231695#. Fraud, Funding, and the First Amendment: Fraud, Funding, and the First Amendment: How Did CME Get Caught Up in Washington Health Care How Did CME Get Caught Up in Washington Health Care Debates? Debates?
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Presented by: Presented by: John R. Kamp, PhD, JDJohn R. Kamp, PhD, JDJudith G. Ribble, PhDJudith G. Ribble, PhD
The webinar will begin shortly.The webinar will begin shortly.
If you need technical assistance please email us at [email protected].
The primary means of listening to this session is via streaming audio, if you are unable to access streaming audio please dial (800) 214-0694 and enter 231695#.
Fraud, Funding, and the First Amendment:Fraud, Funding, and the First Amendment:How Did CME Get Caught Up in Washington Health Care How Did CME Get Caught Up in Washington Health Care
Fraud, Funding, and the First Amendment:Fraud, Funding, and the First Amendment:How Did CME Get Caught Up in Washington How Did CME Get Caught Up in Washington
Health Care Debates?Health Care Debates?
Presented by: Presented by: John R. Kamp, PhD, JDJohn R. Kamp, PhD, JDJudith G. Ribble, PhDJudith G. Ribble, PhD
•• SeronoSerono ——October 2005October 2005 -- $ 704 Million$ 704 Million•• LillyLilly --December 2005December 2005 -- $ 36 Million$ 36 Million•• 100 100 –– 300 Pending Qui Tam Cases300 Pending Qui Tam Cases•• New State PowersNew State Powers•• Medicare Part DMedicare Part D
•• Food and Drug Administration (FDA)Food and Drug Administration (FDA)•• DHHS Office of the Inspector General (HHSDHHS Office of the Inspector General (HHS --OIG)OIG)
–– Department of JusticeDepartment of Justice -- U.S. AttorneysU.S. Attorneys•• State Attorneys GeneralState Attorneys General•• CompetitorsCompetitors•• ConsumersConsumers•• PressPress•• CongressCongress
Qui Tam ActionQui Tam Action• 1986 - False Claims Act Amendments became Law
• Qui Tam provisions enable persons with evidence of fraudulent wrong doing to sue for recovery of ill-gotten gains and to retain a share of the proceeds
• Since 2000, over $3.1 billion was recovered from drug companies due to Qui Tam actions
• Whistleblowers averaged about 18% share
• In pharmaceutical cases, $ 330 Million was paid to whistleblowers for reporting fraud by five companies
•• False Claims Act prohibits the filing of a false cl aim False Claims Act prohibits the filing of a false cl aim [not FDA approved][not FDA approved]
•• Medicaid will not pay Medicaid will not pay for prescription drugs unless for prescription drugs unless the use of the drug is in labeling or is listed in specific the use of the drug is in labeling or is listed in specific compendiacompendia
•• The majority of prescriptions for Neurontin were fo r The majority of prescriptions for Neurontin were fo r offoff --label uses.label uses.
•• United States of America and David Franklin, United States of America and David Franklin, Relator v. ParkeRelator v. Parke --DavisDavis
•• Alleges that ParkeAlleges that Parke --Davis Davis ““ engaged in engaged in fraudulent fraudulent scheme scheme to promote sale of Rx drugs for offto promote sale of Rx drugs for off --label label usesuses
•• Illegal marketing campaign Illegal marketing campaign causedcaused submission of submission of false claimsfalse claims to the VA and to the Federal to the VA and to the Federal government for Medicaid benefitsgovernment for Medicaid benefits
Allegations in ParkeAllegations in Parke --DavisDavis
•• DOJ press release June 7, 2004DOJ press release June 7, 2004
–– ““ WarnerWarner --Lambert promoted Neurontin even when Lambert promoted Neurontin even when scientific studies had shown it was not effectivescientific studies had shown it was not effective ””
•• FDA rejected monotherapy useFDA rejected monotherapy use•• Bipolar studies showed no difference from placeboBipolar studies showed no difference from placebo
–– Funded Funded ““ independent medical educationindependent medical education ””with with ““ extensive input from Warnerextensive input from Warner --Lambert Lambert regarding topics, speakers, content and regarding topics, speakers, content and participants.participants. ””
The IssueThe Issue•• The Court said: The Court said:
–– ““ the only issue is whether Parkethe only issue is whether Parke --Davis Davis ‘‘caused to be presentedcaused to be presented ’’ a false claima false claim
–– §§ 3729 does not require that the 3729 does not require that the ““ causecause ”” be be fraudulent or otherwise independently fraudulent or otherwise independently unlawful.unlawful.
•• What it means is: What it means is: –– Even the dissemination of Even the dissemination of ““ validvalid ”” offoff --label label
information can make you liable under the information can make you liable under the Federal Food Drug & CosmeticFederal Food Drug & Cosmetic ActAct (FCA).(FCA).
The ResultThe Result$240 Million Criminal Fine$240 Million Criminal Fine
““second largest criminal fine ever second largest criminal fine ever imposed in a health care fraud imposed in a health care fraud prosecutionprosecution””
–– $83.6 Million + interest for federal $83.6 Million + interest for federal civil civil False Claims ActFalse Claims Act liabilitiesliabilities
–– $68.4 Million + interest for civil $68.4 Million + interest for civil liabilities for state Medicaid liabilities for state Medicaid programs to 50 states and DCprograms to 50 states and DC
–– $38 Million + Interest remediation $38 Million + Interest remediation program for harm caused to program for harm caused to consumersconsumers
•• FDA always concerned itself with the content of FDA always concerned itself with the content of communications with communications with HCPsHCPs
•• Other enforcement agencies are looking at business Other enforcement agencies are looking at business and personal relationships as well as contentand personal relationships as well as content
•• Usually look at Usually look at totality of relationshiptotality of relationship , not just , not just specific eventspecific event
•• CME is not usually the starting pointCME is not usually the starting point
•• HHSHHS--OIG U.S. Attorneys OIG U.S. Attorneys (Boston and Philadelphia in the lead)(Boston and Philadelphia in the lead)
•• Looking for paper trails regarding Looking for paper trails regarding proactive campaigns for offproactive campaigns for off --label uselabel use–– Position descriptionsPosition descriptions–– Performance evaluationsPerformance evaluations–– Email andEmail and voice mail directivesvoice mail directives–– Where drug marketing practices cross the Where drug marketing practices cross the
Investigations of FCA CasesInvestigations of FCA Cases
•• Financial incentives for offFinancial incentives for off --label uselabel use•• Examination of company funding for CME Examination of company funding for CME
programs about the offprograms about the off --label uselabel use•• Danger to Public HealthDanger to Public Health•• Increasing use for Increasing use for ““ off off
labellabel ”” purposespurposes•• May be used to open May be used to open
the door to broader the door to broader marketing marketing investigationinvestigation
Federal AntiFederal Anti --Kickback LawKickback Law
•• The knowing and willful The knowing and willful act of:act of:–– Offering or paying cash or Offering or paying cash or
any inany in --kind remuneration to kind remuneration to providers to induce the providers to induce the ordering or purchasing of ordering or purchasing of products covered by and products covered by and ultimately paid for under ultimately paid for under Federal health care Federal health care programsprograms
AntiAnti --Kickback LawKickback Law•• Prohibits in the health care industry some practice s Prohibits in the health care industry some practice s
that are common in other business sectors.that are common in other business sectors.
•• Criminal prohibition against payments in any form Criminal prohibition against payments in any form made purposefully to induce or reward the referral or made purposefully to induce or reward the referral or generation of Federal health care business.generation of Federal health care business.
•• Applies if Applies if any one purposeany one purpose of the remuneration may of the remuneration may be to induce or reward the referral or be to induce or reward the referral or recommendation of business recommendation of business payable in whole or part payable in whole or part by a Federalby a Federal health care program.health care program.
Affects Traditional ActivitiesAffects Traditional Activities
•• Providing consulting and auditing services to Providing consulting and auditing services to customerscustomers
•• Use of physician consultants and advisorsUse of physician consultants and advisors
•• Providing trips to conferences and seminarsProviding trips to conferences and seminars
•• ““ Unrestricted educational grantsUnrestricted educational grants ”” to MCOs, medical to MCOs, medical practices, and hospitalspractices, and hospitals
•• List of healthcare providers and List of healthcare providers and pharmaspharmas : : http://http:// oig.hhs.gov/fraud/ciaoig.hhs.gov/fraud/cia //
•• HHSHHS--OIG will evaluate policies and practices:OIG will evaluate policies and practices:–– Physicians as speakers, consultants and as members Physicians as speakers, consultants and as members
of advisory boardsof advisory boards–– Funding of meetings, social events, etc. Funding of meetings, social events, etc. –– Educational, clinical and research grantsEducational, clinical and research grants–– GiftsGifts–– SamplesSamples–– Customer assistance programsCustomer assistance programs
•• The PhRMA Code The PhRMA Code ““ provides useful and practical provides useful and practical advice for reviewing and structuring these advice for reviewing and structuring these relationshipsrelationships ””
•• ““ Although compliance with the PhRMA Code will not Although compliance with the PhRMA Code will not protect a manufacturer as a matter of law under the protect a manufacturer as a matter of law under the antianti --kickback statute, it will substantially reduce the kickback statute, it will substantially reduce the risk of fraud and abuse and help demonstrate a good risk of fraud and abuse and help demonstrate a good faith effort to comply with the applicable federal faith effort to comply with the applicable federal health care program requirementshealth care program requirements ””
State Attorneys GeneralState Attorneys General•• MultiMulti --state investigationsstate investigations
•• Based on a variety of statutes Based on a variety of statutes prohibiting false claims or unfair or prohibiting false claims or unfair or deceptive marketing practicesdeceptive marketing practices
•• May affect state Medicaid May affect state Medicaid programsprograms
•• Seek money damages and costsSeek money damages and costs
Participant Polling Question # 2:Participant Polling Question # 2:What Does Optimal Compliance Look Like?What Does Optimal Compliance Look Like?
"My organization responded to the increased "My organization responded to the increased scrutiny from regulatory agencies by:"scrutiny from regulatory agencies by:"
a. Increasing CME spending a. Increasing CME spending b. Increasing the Medical Affairs departmentb. Increasing the Medical Affairs departmentc. Naming a Compliance Officerc. Naming a Compliance Officerd. All of the aboved. All of the abovee. None of the abovee. None of the above
•• Senator Charles Grassley, DSenator Charles Grassley, D --IA, Chairman, Senate IA, Chairman, Senate Finance CommitteeFinance Committee
•• Letters to Big Pharma: January 2006 Letters to Big Pharma: January 2006 RE: Financial support to RE: Financial support to organizations that develop organizations that develop CMECME