Life Science Compliance Update

April

2018

The Escobar Hurdle – False Claims, Materiality, and Dismissal

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Robert N. Wilkey, Esq.

U.S. ex rel. Ruckh v. CMC II LLC et al. (“Ruckh”) was a closely followed False Claims Act case, because a Florida Federal Court opted to vacate a nearly $350 Million FCA verdict involving a nursing home operator. The case is significant because it demonstrates the ongoing impact of a party’s failure to meet the Escobar materiality standard.


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March

2018

Uncle Sam Wants His Money – First Coast Cardiovascular Institute as a Case Study in Repaying Overpayments Can Generate in FCA Liability

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Robert N. Wilkey, Esq., Staff Writer for Life Science Compliance Update

In October 2017, First Coast Cardiovascular Institute, entered into an almost $450,000 settlement with the DOJ to resolve allegations that it violated the False Claims Act by knowingly delaying repayment of more than $175,000 in overpayments. This settlement involving First Coast is a substantive example of how failing to make timely repayment can bring substantial, additional liability under the FCA. Therefore, it is crucial to ensure timely repayment to and reconcile any overbalances with the U.S. Government.


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March

2018

Soldiering On – The False Claims Act Cases Continue to Significantly Impact Life Science Companies in FY 2017

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Gwen Ball, Staff Writer, Life Science Compliance Update

For FY 2017, the Federal False Claim Act continued to be a potent weapon for combating health care fraud by life sciences companies. However, while overall the settlements appeared to hold steady, there were more defendants and smaller settlements. This article explores the FY 2017 data for what it may reveal about the future of FCA cases against life sciences companies.


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March

2018

Establishing the Link – The False Claims Act and Temporal Proximity

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Nicodemo Fiorentino, Esq., Member, Life Science Compliance Update Editorial Board

Under the Patient Protection and Affordable Care Act of 2010, a provision was added to significantly strengthen the Federal Anti-Kickback Statute by making a violation of the AKS also a violation of the Federal False Claims Act. Thus, if a relator or government can prove that Anti-Kickback Statute was violated, then it would constitute a false or fraudulent claim under the False Claims Act. But, what type of evidence is needed to connect a kickback to a false or fraudulent claim? A recent United States Court of Appeals for the Third Circuit case, United States ex rel. Greenfield v. Medco Health Sols., Inc., 880 F.3d 89 (3d Cir. 2018), answered this question. This article discusses that case and its implications.


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  • February

    2018

    Has the Shine Worn Off False Claims QUI TAM Actions

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    Gwendolyn Ball, Staff Writer, Life Science Compliance Update

    At the recent HCCA Annual Conference, the Deputy Director of DOJ’s Civil Fraud Section may have signaled a change in policy relative to handling qui tam cases. This article explores the issue and what it might mean for life science companies going forward.


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    February

    2018

    Revisiting the Past – Warner Chilcott vs. Insys

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    Kaitlin Fallon Wildoner, Esq., Senior Staff Writer, Life Science Compliance Update

    Those who remember the Warner Chilcott and W. Carl Reichel case from just two years ago may have had déjà vu when they heard about the recent legal controversy surrounding John N. Kapoor and Insys. This article reviews the current Insys and Kapoor developments and compares the two cases to analyze whether the trend of involving high-ranking executives is the future of enforcement.


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    February

    2018

    One Purpose to Rule Them All – A Resounding “Yes” According to the District Court in U.S. EX Rel. Cairns

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    Robert N. Wilkey, Esq., Staff Writer and Seth B. Whitelaw, J.D., LL.M., S.J.D., Editor for Life Science Compliance Update

    The breadth of liability under the False Claims Act and Anti-Kickback Statute is a closely watched area. Recently, the U.S District Court for the Eastern District of Missouri concluded that liability might extend to a health care provider even where the plaintiff fails to demonstrate that the “primary purpose” of providing the benefits was to create an inducement. Although the impact of such Court case remains somewhat uncertain, it is expected that the Court’s ruling will continue to expand FCA and AKS liability


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    February

    2018

    Staring Down Another First Amendment Challenge – The OIG vs. Patient Services

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    Kaitlin Fallon Wildoner, Esq., Senior Staff Writer, Life Science Compliance Update

    Patient Assistance Programs (“PAPs”) are starting to feel the heat from various United States agencies, as we have noted in several issues over the past year. Recently, Patient Services, Inc., filed suit in response to a Modified Advisory Opinion issued by the HHS OIG. This article outlines the changes and the suit.


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    February

    2018

    When Good Intentions Go Astray – United Therapeutics Settles AKS Suit

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    Kaitlin Fallon Wildoner, Esq., Senior Staff Writer, Life Science Compliance Update

    With the United Therapeutics settlement, it is clear that the DOJ remains focused on patient assistance programs and other similar charities. As a result, additional settlements involving these programs are likely to continue in 2018, once more pitting established legal constructs against current fiscal realities.


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    December

    2017

    Even Distributors Are Not Immune – AmeriSourceBergen’s Recent Compliance Struggles

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    Robert N. Wilkey, Esq., Staff Writer for Life Science Compliance Update

    In recent months, AmeriSourceBergen’s (“ABC”) ongoing struggles with compliance about its corporate subsidiaries and wholesale units has been well-publicized. For instance, on August 23, 2017, the United States Department of Justice (“DOJ”) announced a settlement $13.4 Million involving illicit False Claims Act (“FCA”) and kickback billing activities by U.S. Bioservices Corp., a unit of wholesale ABC concerning the medication Exjade. In a separate matter, the DOJ a settlement with ABC to resolve criminal liability relating to illicit business activities by AmeriSouceBergen Specialty Group (“ABSG”), a subsidiary of ABC involving the misbranding and distribution of oncology cancer related medications from a processing facility that was not approved by the U.S. Federal Food and Drug Administration (“FDA”). Both cases highlight the FCA civil, and criminal liability parent companies face for the illicit conduct of their various corporate subsidiaries and entities.


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    December

    2017

    Mylan’s “Banquet of Consequences” Ends for Now with the Latest EpiPen Settlement

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    Kaitlin Fallon Wildoner, Esq., Senior Staff Writer, Life Science Compliance Update

    Mylan has been the subject of bad press for roughly a year now. Fortunately, it seems as though the firestorm surrounding the company – including the EpiPen price saga – may be over for now. This article outlines a recent suit filed by a Mylan competitor and the settlement and CIA that resulted. It concludes with insight from a prominent CEO about how compliance officers and other executives can avoid the negative press Mylan has endured.


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    September

    2017

    Taking Center Stage – Washington State’s Medicaid Fraud Control Unit, the False Claims Act and Celegene

    Written by , Posted in False claims

    Robert N. Wilkey, Esq., Staff Writer for Life Science Compliance Update

    On July 26, 2017, the Washington State Attorney General Bob Ferguson announced one of the State’s largest recoveries against the pharmaceutical company Celgene for allegations involving violations of the Medicaid False Claims Act, in particular claims related to the company’s off-label marketing, fraudulent billing and providing kickbacks to doctors. The Washington State AG recovery represents a pivotal point in life science compliance, where State AGs, are actively seeking recoveries against companies that violate state and federal Medicare programs.


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    September

    2017

    Fresenius to the U.S. Government: When It Comes to the FCA, You Snooze You Lose

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    Robert N. Wilkey, Esq., Staff Writer for Life Science Compliance Update

    In a nearly decade long lawsuit allegations that the company violated the False Claims Act by conducting and then billing the government for medically unnecessary hepatitis B tests, Fresenius is now seeking to challenge that the government is time-barred because the government took too long to intervene in this case. Although the Court has yet to decide the challenge by Fresenius, the outcome of that decision will likely have a significant impact on future government decisions to intervene in False Claim Act cases.


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    September

    2017

    To Disclose or Not to Disclose…. That is the Question: The DOJ’s FCPA Pilot Program – Insights from Year One and Beyond

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    Mark Scallon, Partner, FRA Life Sciences, Jenny McVey, Manager, FRA Life Sciences and Jimmy Ko, Senior Associate, Forensic Risk Alliance

    It has been over one-year since the US Department of Justice has launched its pilot program aimed to incentivize companies to self-report potential Foreign Corrupt Practices Act violations. Since its launch on April 5, 2016, the Justice Department resolved nine investigations. However, the question still remains – “Is the carrot bigger than the stick?” This article examines settlement trends before and during the Pilot Program to answer the question of whether or not it is sensible to self-disclose.


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    September

    2017

    False Claims Act Mid-Year Review: Significant Life Science Settlements, Post-Escobar Developments & Industry Round Up

    Written by , Posted in False claims

    John Kelly, Julia Tamulis, and Robert Platt

    Several significant False Claims Act settlements and judgments in the first six months of 2017 suggest this year will result in the eighth year of over $3 billion in FCA recoveries. Additionally, recent judicial decisions in FCA suits have further refined the test outlined in the Supreme Court’s 2016 Escobar decision, statistical sampling has resulted in significant FCA liability.


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