We learned last week that the first settlement of claims in the government’s ongoing investigation of ties between pharmaceutical manufacturers and patient assistance programs happened in September when Aegerion Pharmaceuticals agreed to pay more than $35 million to resolve criminal charges and a civil False Claims Act lawsuit.

The settlement related to the marketing of Juxtapid, a lipid-lowering agent for the treatment of familial hypercholestrolemia, a rare disorder that causes abnormally high levels of circulating LDL-C. There were many facets to the allegations, including that the drug was misbranded because Aegerion failed to comply with a Risk Evaluation and Mitigation Strategy (REMS) set by the FDA. There have been a handful of settlements for the failure to comply with the terms of a REMS program by manufacturers recently.

As it relates to patient assistance programs, the government alleged in the civil false claims act lawsuit that the company violated the Anti-Kickback Statute by funneling funds through an entity claiming to be a non-profit patient assistance program in order to defray patient’s copayment obligations.

The Anti-Kickback Statute prohibits the offer, payment or receipt of any remuneration to induce or reward the referral or generation of business reimbursed by a Federal health care program. The copayment obligations are designed to promote prudent prescribing and purchasing decisions as well as price competition. Waiving the copay, either through copayment coupons or patient assistance programs, can ultimately harm the Federal health care programs even though they provide an immediate financial benefit to the patient beneficiary.

As we understand it, the government patient assistant program investigation started because there were allegations that the nonprofits receiving funds from the pharmaceutical manufacturers and allocating the money to patients were not exercising independent decision-making. Instead, the investigations reportedly involved a quid pro quo between the donation by the pharmaceutical company and the allocation of the money to patients receiving the manufacturer’s drug.

We will continue to follow the government’s involvement in False Claims Act litigation concerning REMS and copay assistance programs here.