In 2012, New England Compounding Center (“NECC”) shipped contaminated anti-pain medication to hospitals and clinics around the country, with devastating consequences. Patients around the country developed fungal meningitis and spinal and paraspinal infections. At least 63 died, and nearly 700 more suffered debilitating injuries. In opinions issued on July 9, 2020, the First Circuit addressed—and, for the most part, rejected—efforts by NECC’s owner and chief pharmacist to vacate their convictions and set aside the lengthy prison sentences they were ordered to serve for their roles in shipping the contaminated drugs.… More
Category Archives: Healthcare Fraud
The United States Attorney for the District of Massachusetts is proactively seeking to find, investigate, and prosecute unlawful attempts to exploit the COVID-19 pandemic and is asking hospitals to assist. U.S. Attorney Andrew Lelling sent a letter to leaders of Massachusetts hospitals asking them to report any “individuals and companies that may have acquired vital medical supplies in excess of what they would reasonably use, or for the purpose of charging exorbitant prices.” The Secretary of Health and Human Services has designated 15 categories of supplies as “scarce,” thereby enabling prosecutors to seek certain civil and criminal enforcement remedies against anyone accused of hoarding or gouging prices for those supplies. … More
The Department of Justice (DOJ) announced a criminal complaint last Friday in the most significant COVID-19 fraud prosecution to date. A complaint is a charging document usually submitted to a court to obtain an arrest warrant. It is not an indictment, and, unless an early resolution is reached, in order to pursue the case further DOJ will have to present the case to a grand jury to vote on charges (whenever grand juries are once again in session).… More
Editors’ Note: This is the fifth in our start-of-year series examining important trends in white collar law and investigations in the coming year. Our previous entry discussed False Claims Act trends in 2020. Up next: a look at the year ahead in cross-border compliance and sanctions. Look for additional posts throughout the month of January.
2019 marked the beginning of Maura Healey’s second term as Massachusetts Attorney General.… More
Editors’ Note: This is the fourth in our start-of-year series examining important trends in white collar law and investigations in the coming year. Our previous entry discussed anti-corruption trends in 2020. Up next: a look at State Attorney General trends. Look for additional posts throughout the month of January.
More than halfway into the Donald Trump administration,… More
Editors’ Note: This is the second in our start-of-year series examining important trends in white collar law and investigations in the coming year. Our previous entry discussed SEC enforcement in 2020. Up next: a look at trends in anti-corruption and under the Foreign Corrupt Practices Act. Look for additional posts throughout the month of January.
2019 saw ongoing action in the healthcare space.… More
No Good Deed Goes Unpunished: DOJ’s Pursuit of Alleged Drug Co-Pay Kickbacks Extends to the Charities Themselves
Back in May, we wrote about substantial settlements totaling $125 million to resolve Department of Justice (DOJ) allegations that money donated by Astellas Pharma US, Inc. and Amgen Inc. to drug co-pay charities constituted illegal kickbacks under the False Claims Act (FCA). At the time, we noted that the settlements were the seventh and eighth such resolutions in the District of Massachusetts since December 2017,… More
Thanks to inexact language in a settlement agreement, a for-profit hospital chain can challenge whistleblowers’ eligibility for attorneys’ fees under the False Claims Act (“FCA”). The single sentence that spawned nearly 5 years of litigation was: “All Parties agree that nothing in this Paragraph or this Agreement shall be construed in any way to release, waive or otherwise affect the ability of CHS to challenge or object to [whistleblower’s] claims for attorneys’ fees,… More
The U.S. Department of Justice (DOJ) continues to actively target the healthcare industry for False Claims Act (FCA) and other alleged violations, and it took significant steps to further its reach into the telehealth and genetic testing markets this week. Prosecutors in the Southern District of Florida (SDFL) indicted the CEO of a genetic testing company in an alleged referral-source kickback scheme in which, according to the indictment,… More
Late last month the U.S. Attorney’s Office for the District of Connecticut issued a press release regarding the latest False Claims Act (FCA) settlement involving the healthcare industry in New England. According to the Department of Justice (DOJ), Clinical Science Laboratory, Inc. (CSL) and its individual owners agreed to pay over $1.5 million to settle claims that they had violated federal and state FCA laws. The government stated that Massachusetts-based CSL provided urine drug testing services for substance abuse patients in Connecticut,… More
Two More Pharma Companies Resolve Co-Pay Foundation Kickback Claims – Prosecutors Continue Pursuit of Similar Cases
Federal and state prosecutors recently convened at the Boston Bar Association’s White Collar Crime Conference to discuss, among other topics, health care enforcement priorities. At the conference, the U.S. Attorney’s Office for the District of Massachusetts (USAO) highlighted its recent focus on pharmaceutical companies that make donations to co-pay assistance foundations, an area where we have recently seen a flurry of False Claims Act (FCA) enforcement.… More
Government Attorneys Discuss Health Care Enforcement Priorities at BBA White Collar Crime Conference
Opioids, off-label marketing, and the home health industry will remain priorities for federal and state attorneys enforcing health care laws, according to comments made at the Boston Bar Association’s (BBA) White Collar Crime Conference.
The conference, held in Boston on April 22, featured speakers from the civil and criminal divisions of Boston’s U.S. Attorney’s Office and from the Massachusetts Attorney General’s Office.
Civil enforcement by the U.S.… More
Lessons from a Recent (and Rare) DOJ FCA Lawsuit Against a Private Equity Firm and Its Portfolio Pharmacy Company
Recently, a Florida federal judge dismissed the Department of Justice’s (DOJ) False Claims Act (FCA) allegations against a compounding drug pharmacy and the pharmacy’s private equity (PE) owner. For two reasons, the case may be illustrative of the DOJ’s increasingly aggressive pursuit of what it perceives as fraud within the healthcare industry.
First, it is noteworthy that DOJ suffered a dismissal of its FCA claims. … More
The Department of Justice (DOJ) announced recently that it reached a $63.5 million settlement with pathology lab Inform Diagnostics related to allegations of False Claims Act (FCA) and Stark Law violations. The government alleged that the company had illegally provided referral-source doctors with subsidies for electronic health records (EHR) systems and free or discounted technology consulting services. The case, which developed out of a whistleblower complaint, was prosecuted as a civil matter with the coordination multiple DOJ offices,… More