Last week was not the only settlement agreement (AstraZeneca) signed between a pharmaceutical company and the Office of Inspector General (OIG) of the Department of Health and Human Services (HHS). Two Johnson & Johnson (J&J) subsidiaries also entered into a settlement agreement to pay over $81 million to resolve allegations of off-label promotion of the epilepsy drug Topamax.
The Food and Drug Administration (FDA) approved Topamax as an anti-epileptic drug, for the treatment of partial onset seizures, but not for any psychiatric use. As we previously noted, a manufacturer may not market or promote a drug for any use not specified in its new drug application. The unauthorized uses are also known as “unapproved” or “off-label uses.”
The civil Settlement Agreement resolves two lawsuits filed in the District of Massachusetts under the qui tam, or whistleblower, provisions of the False Claims Act: ex rel. Maher, et al. v. Ortho-McNeil Pharmaceutical, Civil Action No. 03-11445-WGY, and ex rel. Spivack v. Johnson & Johnson and Ortho-McNeil Pharmaceutical, Inc., Civil Action No. 04-11886-WGY. The whistleblowers in these cases will receive payments totaling more than $9 million from the federal share of the civil recovery.
According to a press release issued by the Department of Justice (DOJ), and Carmen M. Ortiz, United States Attorney for the District of Massachusetts, Ortho-McNeil Pharmaceutical, LLC has agreed to plead guilty to a misdemeanor and pay a $6.14 million criminal fine for the misbranding of Topamax in violation of the Food, Drug and Cosmetic Act.
The Government alleged that Ortho-McNeil Pharmaceutical promoted the sale of Topamax for off-label psychiatric uses through a practice known as the “Doctor-for-a Day” program. DOJ alleged that Ortho-McNeil used this program to hire outside physicians to join sales representatives in their visits to the offices of health care providers and to speak at meetings and dinners about prescribing Topamax for unapproved uses and doses.
In addition to the criminal fine, Ortho-McNeil-Janssen Pharmaceuticals will pay $75.37 million to resolve civil allegations under the False Claims Act that it illegally promoted Topamax and caused false claims to be submitted to government health care programs for a variety of psychiatric uses that were not medically accepted indications and therefore not covered by those programs.
As a result of the settlement agreement, Plea Agreement and a separate Side Letter, the federal government will received $50,688,483.52, and the state Medicaid share will get $24,681,516.48.
Corporate Integrity Agreement
Also as part of the settlement, Ortho-McNeil-Janssen Pharmaceuticals has agreed to enter into an expansive corporate integrity agreement with OIG and HHS. The Corporate Integrity Agreement requires Ortho-McNeil-Janssen-Pharmaceuticals, Inc. to increase transparency and accountability and to make changes designed to avoid illegal drug promotion in the future.”
Effect on CME
Within 120 days of the effective date of the agreement, OMJPI will be required to offer training to all covered parties (e.g. consultants, speakers, educational providers, etc.) regarding the CIA, and new policies and regulations. The new policies and procedures, which must be applicable to the federal health care program and FDA rules, require that:
1) OMJPI disclose its financial support of the Third Party Educational Activity and any financial relationships with faculty, speakers, or organizers at such Activity;
2) Third parties disclose OMJPI's financial support of the Third Party Educational Activity and any financial relationships that OMJPI might have with faculty, speakers, or organizers at such Activity;
3) Any faculty, speakers, or organizers at the Third Party Educational Activity disclose any financial relationship with OMJPI;
4) The Third Party Educational Activity have an educational focus;
5) The content, organization, and operation of the Third Party Educational Activity be independent of OMJPI control;
6) OMJPI support only Third Party Educational Activity that is non-promotional in tone/nature; and
7) OMJPI support of a Third Party Educational Activity to be contingent on the provider's commitment to provide information at the Educational Activity that is fair, balanced, accurate and not misleading;
With regards to a speaker, member of an advisory board or a participant in data-gathering exercises that OMJPI engages or reimburses, the company must require all Consultants to enter written agreements describing the scope of work to be performed, the fees to be paid, and compliance obligations for the Consultants.
Such obligations for speakers include the use of OMJPI approved materials and requirements that speakers may not directly or indirectly promote the product for off-label uses. Payment for consultants will be according to a centrally managed, pre-set rate structure that is determined based on a fair-market value analysis conducted by OMJPI.
OMJPI must ensure that all speaker programs continue to be initiated and tracked through a centralized, electronic system that includes controls (including the use of a centrally managed, pre-set rate structure for payment that is determined based on a fair-market value analysis conducted by OMJPI) designed to ensure that speaker programs are used for legitimate and lawful purposes in accordance with all applicable Federal health care program and FDA requirements.
The company will also maintain a comprehensive list of speaker program attendees through its centralized system. This centralized system will also handle all logistics and spending associated with speaker programs, including the tracking and review of the aggregate amount paid to each speaker in connection with speaker programs conducted during each Reporting Period, including speaker fees, travel, and other expenses.
A Consulting Monitoring Program will also be established to review speaker programs. The program will review slides and other materials used as part of the speaker program, speaker statements made during the program, and OMJPI sales representative activities during the program to assess whether the programs were conducted in a manner consistent with OMJPI's Policies and Procedures.
Disclosure
Beginning September 30, 2010, OMJPI will start Phase I Reporting, in which the company will post in a prominent position on its website an easily accessible and readily searchable listing of all physicians and Related Entities who or which received any payments directly or indirectly from OMJPI during the first two calendar quarters of 2010. Phase I payments include:
– Payments, fees, and honoraria, or compensation for, or in connection with services (such as consulting, speaking, advisory board) rendered;
– Payments or reimbursement for entertainment, gifts, trips or travel;
– Other economic benefit furnished or reimbursed by OMJPI in connection with contracted services (and which are not otherwise covered or paid for by the Physician or Related Entity); and
– All payments or transfers of value made to Related Entities on behalf of, at the request of, for the benefit or use of, or under the name of a physician for whom OMJPI would otherwise report a Payment if made directly to the physician.
After the initial posting, 60 days after the end of each subsequent calendar quarter, OMJPI must also post on its website a listing of updated information about all Phase I Payments made during the preceding calendar quarter. OMJPI will also have to post a cumulative value of Phase 1 payments to each physician and/or Related Entity during the preceding calendar year by May 1, 2011.
By July 1, 2011, Phase II Reporting will begin, which includes reporting of all Phase I Payments in addition to all payments or transfers of value made by OMJPI for:
– Research;
– Education; and
– Payment or reimbursement by OMJPI for business meals, as well as for all Phase I Payments, irrespective of the contract status of the physicians or Related Entity.
OMJPI will also have to post this information in a prominent position on its website an easily accessible and readily searchable listing of all physicians and Related entities who or which received any Payments defined above. The cumulative report is due no later than May 1, 2012.
The final Phase III Reporting will begin around June 30, 2012, and include all payments in the two previous phases with the same website reporting requirements, updated information every 60 days, and a cumulative report no later than May 1, 2013. This report will be annual thereafter.
For all website postings, each listing will include a complete list of all individual physicians and Related Entities. Each listing will be arranged alphabetically according to the physicians' last name or the name of the Related Entity. The Payment amounts in the lists will be reported in $10,000 increments (e.g., $0– $10,000; $10,001- $20,000; etc.) or in the actual amount paid, provided, however, that the Payment amounts will be listed in the same way (incrementally or in actual amounts) for all physicians and/or Related Entities on the listing. For each physician, the listing will include:
i) Physician's full name;
ii) Name of Related Entity (if applicable);
iii) City and state of the physician's practice or the Related Entity;
iv) The purpose of the payment(s); and
(v) The aggregate value of the payment(s) in the preceding quarter(s) or
year (as applicable).
For purposes of its website posting of the quarterly and annual listings of
Payments, and with regard only to payments made pursuant to product research or development agreements and clinical investigations, OMJPI may delay the inclusion of such payments on its website listings consistent with federal.
There is also a requirement in the CIA for the IRO to review and assess the distribution of samples.
Documents
Ortho-McNeil Massachusetts Press Release
Orhto-McNeil Corporate Integrity Agreement
Ortho-McNeil Side Letter Settlement on Prosecutions
Ortho-McNeil Topamax Civil Settlement
Leonard Pulido
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