Pharmaceutical fraud has been fought successfully through the help of whistleblowers. Although it still is a prominent problem in our healthcare system, millions, and even billions, have been recovered from those who have tried to cheat the system.
The following is an example of pharmaceutical fraud:
- Illegal Kickbacks/Inducements: Pharmaceutical companies may pay or otherwise incentivize physicians to prescribe their drugs. These may be bonuses, vacations, meals, tickets, speaker fees, board member stipends, business ventures, etc. They can also financially incentivize insurance companies and Group Purchasing Organizations (“GPO’s”) to place their drugs on the preferred drug formulary. This can be a violation of the Federal Anti-Kickback statute, 42 U.S.C. §1328-7b(b), and the Federal False Claims Act.
- Off-Label Marketing of Drugs: When a pharmaceutical company is marketing a drug, it can only market it to treat the FDA approved medical condition or conditions that the drug is able to treat. Physicians, however, have the ability to prescribe drugs for treatment of other unapproved conditions. This practice is known as “off-label” use of a drug because it goes beyond those uses specifically approved by the FDA for the drug label. Pharmaceutical manufacturers have marketed their drugs to physicians for an off-label or unapproved use. Pharmaceutical companies violate federal law, including the False Claims Act, when they encourage physicians to use their drugs in an off-label manner.
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