Jennifer E. Michael, Member of the Firm in the Health Care & Life Sciences practice, in the firm’s Washington, DC, office, was quoted in Stat News, in “U.S. Officials Will Let Novartis Pay Expenses for Some Kymriah Patients Who Must Travel for Treatment,” by Ed Silverman. (Read the full version – subscription required.)
Following is an excerpt:
In an unexpected move, the U.S. Department of Health and Human Services will allow Novartis (NVS) to pay for travel, lodging, and meal expenses for Medicare and Medicaid beneficiaries who must leave home to be administered the Kymriah gene therapy.
The HHS OIG issued a so-called advisory opinion in response to a request from the drug maker, which wanted to avoid sanctions that would normally be levied against a pharmaceutical company that sought to reimburse Medicare and Medicaid patients. Under federal law, such payments would be considered the equivalent of a kickback. …
Over the past two years, several drug makers reached settlements with the U.S. Department of Justice over accusations that donations paid to patient charities actually were kickbacks to Medicare patients as a way to cover out-of-pocket costs. So far, eight drug companies have paid more than $840 million in settlements and four patient charities have paid7 $13 million to settle allegations.
“At first blush, it seems contradictory to other positions the government has taken,” said Jennifer Michael, a partner in the health care and life sciences practice at the Epstein Becker Green law firm, where she specializes in federal and state fraud issues, including anti-kickback, false claims, and regulatory compliance.
“They’re walking a tightrope. The government is going after companies that indirectly subsidize patients in one context, but allowing direct subsidies here. And they’re doing everything they can to distinguish this arrangement from other arrangements that might follow,” Michael explained. She also noted that, in a proposed rule last October concerning value-based agreements, the HHS OIG refused to exclude drug makers from potential kickback violations.
“Of course, this opinion only refers to this one request, which means no other company can use this as protection for a similar arrangement. But it shows how the OIG is thinking about these issues,” she said.