What is a pharmaceutical kickback?
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What is a pharmaceutical kickback?

| Sep 17, 2020 | Healthcare Fraud, Qui Tam Cases |

When a medical doctor or clinician is given a monetary incentive to prescribe a medicine, product or device to patients, this is known as a pharmaceutical kickback.

How common are pharmaceutical kickbacks?

A 2015 study by the JAMA found that almost half- 48% of all doctors – in the United States received a payment of one kind or another from a drug or medical device company. In 2018, the Lown Institute found that most common kickbacks were paid not for opioids, but instead for drugs to treat common diseases such as cancer, MS, diabetes, mental health conditions and skin disorders.

A 1987 federal law called the Anti-Kickback statute (AKS) made it illegal for any party to “make or accept” any form of payment that encourages those in healthcare to prescribe or purchase a product or service that is reimbursed or paid for by federal health care programs such as Medicare or Medicaid.

A recent New York AKS case

Many people read about the Manhattan doctor Jeffrey Goldstein. Goldstein pled guilty last August of receiving bribes from the pain-killing drug Subsys and its manufacturer, Insys Therapeutics. The bribes were for his prescribing Subsys, a fentanyl-based spray. Goldstein reportedly received nearly $200,000 in bribes and kickbacks according to an August 16, 2019 press release from the Justice Department. Goldstein and three other doctors received excessive “speaker fees” in exchange for prescribing large amounts of Subsys to patients.

What is not illegal?

Pharmaceutical companies cannot legally pay clinicians to prescribe their products. They can however pay for these medical professionals to speak at a conference, consult, and travel and dine with them.

However kickbacks, as the name implies, can be any improper incentive that influences a medical provider’s willingness to prescribe a drug. There are legitimate “safe harbors” that must meet stringent criteria to avoid being characterized and charged as pharmaceutical fraud. Those who know of pharmaceutical kickbacks are encouraged to contact an attorney who works in whistleblower law.