Pharmaceutical manufacturers … may run afoul of the Anti-Kickback statute

Friday, September 19, 2014

Pharmaceutical manufacturers who offer copayment coupons to insured patients to reduce or eliminate the cost of their out-of-pocket copayments for specific brand-name drugs may run afoul of the Anti-Kickback statute, says the OIG in a September 2014 Special Advisory Bulletin.

The anti-kickback statute makes it a criminal offense to knowingly and willfully offer, pay, solicit or receive any remuneration to induce or reward the referral or generation of business reimbursable by any Federal Health care program. Thus, if copayment coupons are used by Medicare Part D beneficiaries to defray the cost of their drug purchases, the anti-kickback statute is implicated since the copayment coupon has the effect of inducing the beneficiary to purchase the drug to which the coupon applies.

The pharmaceutical industry already places warnings on its copayment coupons that they may not be used by beneficiaries of Federal health care programs. Nonetheless, this new Special Advisory Bulletin makes it plain that OIG does not believe that these warning go far enough. OIG found that there are insufficient mechanisms in place in the processing of claims to ensure that the coupons are not used by Part D beneficiaries because the “coupons are not transparent in the pharmacy claims transaction system to entities other than manufacturers, which impedes Part D plans and others from identifying and monitoring the use of coupons for drugs paid for by Part D.” Thus, pharmaceutical manufacturers will have to come up with a way to make copayment coupons universally identifiable in pharmacy claims transactions to stay compliant with the anti-kickback statute.