What’s New/Significant

The Patient Access Network Foundation (PANF) agreed to pay $4 million, and the Chronic Disease Fund Inc. d/b/a/ Good Days from CDF (Good Days) agreed to pay $2 million, to the United States Department of Justice in order to resolve charges that they violated the False Claims Act by acting as a conduit for pharmaceutical companies to pay kickbacks to Medicare patients taking their drugs.

Allegations

The government alleged that PANF and Good Days worked with various pharmaceutical companies to design and operate funds that funneled money from the companies to patients taking the specific drugs the companies sold. The creation of these funds enabled the companies to ensure that Medicare patients did not consider the high costs that the companies charged for their drugs and minimized the possibility that the companies’ money would go to patients taking competing drugs made by other companies. Specifically, the government alleged that, from 2010 through 2014, Good Days worked with Novartis, Dendreon, Astellas, Onyx and Questcor to create funds that provided co-pay assistance or travel expenses to Medicare patients taking their drugs, but not to patients taking other drugs, and in some cases, to provide data concerning the number of patients receiving money from the fund. Likewise, the government alleged that from 2011 through 2014, PANF worked with Bayer, Astellas, Dendreon and Amgen to create certain funds that functioned primarily, if not exclusively, to cover the co-pays of the drugs from the single company that financed each fund.

Scope of Settlement

In addition to the monetary settlements, CDF and PANF each entered a three-year Integrity Agreement (IA) with OIG. The IAs require, among other things, that the foundations implement measures designed to ensure that they operate independently, and that their arrangements and interactions with pharmaceutical manufacturer donors are compliant with the law. In addition, the IAs require i) training for and compliance-related certifications from each company’s board of directors; ii) enhanced documentation and record-keeping practices; iii) development of written policies and procedures describing the process of and criteria for establishing disease funds; and iv) detailed reviews by Independent Review Organizations.