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April 29, 2021

An Uptick in Enforcement Signals OIG’s Compliance Priorities on Pharmaceutical Manufacturer Sponsorship of Charities that Implement Patient Assistance Programs

This Bulletin is brought to you by AHLA’s Fraud and Abuse Practice Group.
  • April 29, 2021
  • Asha B. Scielzo , American University Washington College of Law
  • Elizabeth L. Raterman , JD Candidate, American University Washington College of Law
  • Riley Driscoll , JD Candidate, American University Washington College of Law
  • Christopher Weeks , JD Candidate, American University Washington College of Law

Pharmaceutical manufacturers often sponsor or fund charitable patient assistance programs (PAPs) that provide financial assistance to low-income patients to purchase medications or pay for specialized treatment. While the Department of Health and Human Services (HHS) Office of Inspector General (OIG) and the Department of Justice (DOJ) recognize that PAPs provide vital safety net assistance to patients of limited means, PAPs are high-risk areas for fraud and abuse if improperly structured, especially when facilitated by an intermediary charitable organization that serves as a conduit for pharmaceutical manufacturer donations. The OIG has signaled through guidance and subsequent enforcement actions that it heavily scrutinizes pharmaceutical manufacturer sponsored PAPs because of concerns arising under the federal Anti-Kickback Statute (AKS) and the beneficiary inducement provisions of the Civil Monetary Penalties Law (CMPL). These issues also trigger potential liability under the federal civil False Claims Act (FCA) and other federal and state fraud statutes.

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