PorzioLS EA Update: Pharma Co. Settles False Claims Act Allegations, Pays $12.6 Million

June 15, 2021

By Porzio Life Sciences

The pharmaceutical company, Incyte Corporation (Incyte) markets and sells Jakafi, a drug approved for the treatment of myelofibrosis, a rare bone marrow disorder. According to a recent Department of Justice (DOJ) News Release, Incyte has agreed to pay $12.6 million to resolve allegations that it violated the False Claims Act by paying kickbacks. A former compliance executive of Incyte filed the complaint under the qui tam provisions of the False Claims Act.

Incyte allegedly engaged in multiple kickbacks and unlawful marketing schemes including the use of nurse educators to recommend their product to physicians and use of "white coat marketing" to promote directly to patients, money provided for sponsorships/exhibits, and the use of "sham" speaker programs in exchange for remuneration for prescribing, including the provision of in-office meals and use of sign-in sheets. Additionally, in order to induce patients to purchase Jakafi, Incyte allegedly used independent foundations as a conduit to pay the copay obligations of Medicare patients. According to the Complaint, the violative conduct took place from November 2011 through December 2014. While the funds provided to the foundations were originally opened to provide assistance to myelofibrosis patients, the government alleges that Incyte used the funds to pay the copays of federal beneficiaries who did not have myelofibrosis and were therefore not eligible for assistance, thereby causing false claims to be submitted to Medicare and TRICARE.

Acting U.S. Attorney Jennifer Arbittier Williams for the Eastern District of Pennsylvania states in the News Release, “Pharmaceutical companies cannot skirt the anti-kickback rules by disguising their inducements to federally-insured patients as charitable donations. This resolution shows our office’s continuing commitment to holding drug companies accountable for this conduct.”

A copy of the DOJ News Release is available here.

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