Pfizer’s Subsidiary Biohaven Settles for Nearly $60M Over Speaker Programs: Complaint included Significant Open Payments Under Reporting

Pfizer’s Subsidiary Biohaven Settles for Nearly $60M Over Speaker Programs: Complaint included Significant Open Payments Under Reporting

Pfizer’s subsidiary Biohaven has agreed to a settlement nearing $60 million to resolve allegations of false claims related to improper physician remuneration. This settlement marks a pivotal moment in pharmaceutical compliance, particularly as the implicated activities spanned the COVID-19 pandemic.

Background of the Case

The case against Biohaven, which Pfizer acquired in October 2022, involves claims from March 1, 2020, through September 30, 2022. These allegations assert that Biohaven engaged in offering improper remuneration to healthcare professionals as part of its speaker programs for the migraine medication Nurtec ODT. Notably, this is the first Department of Justice press release to specifically mention “virtually” held speaker programs, highlighting the modern challenges of compliance in digital contexts.

Detailed Allegations

The Department of Justice outlined several key issues in its complaint against Biohaven:

  1. Selection of Healthcare Professionals: Biohaven allegedly selected healthcare professionals for its Nurtec ODT speaker bureau intending that the honoraria would induce them to prescribe Nurtec.  The company had significant documentation on their targeting rationale that was included in the complaint.
  2. Inappropriate Attendees: The programs often included attendees with no educational need, such as the speaker’s spouse, family members, friends, and colleagues from the speaker’s own practice.
  3. Repetitive Attendance: Healthcare professionals attended multiple programs on the same topic, received expensive meals and drinks, and reportedly received no educational benefit from these programs.

Examples from the Complaint

The complaint vividly details instances underscoring the alleged improprieties:

  • Non-Educational Settings: Several speaker programs were held at venues not conducive to learning, such as luxury restaurants or entertainment venues, which diminishes the supposed educational purpose.
  • Excessive Compensation: Speakers were frequently compensated beyond fair market value for their roles, with payments seemingly tied to their prescription volumes of Nurtec rather than their expertise or educational impact.
  • Under Reporting in Open Payments: According to the complaint, there was a significant discrepancy in the reporting of speaker payments to healthcare professionals (HCPs) to the CMS Open Payments System, particularly during 2020. The complaint highlights that the top six speakers, who were also the top prescribers of Biohaven’s products, had their payments grossly underreported. Specifically, less than 10.5% of the actual payments made to these individuals were reported to the CMS, with an underreported sum exceeding $250,000. This underreporting issue was notably brought to light shortly after the publication of the 2020 Open Payments Data, which was released on June 30, 2021. The timing of the complaint’s filing, less than 60 days after this data release, underscores the urgency and seriousness of the allegations regarding Biohaven’s compliance with federal reporting requirements and the use of Open Payments by qui tam attorneys.
  • Program Necessity and Attendance: Biohaven continued to sponsor numerous programs without significant new information about the drug, often repeating content to the same groups of attendees, which included non-prescribers like friends or family members of the speaker.
  • Over-Scheduling of Virtual Speaker Programs: The complaint details an aggressive schedule of virtual speaker programs orchestrated by Biohaven’s Long Island sales territory representative. Despite there being only 18 possible weekday evenings in April 2020 at the height of the pandemic, the representative managed to host 17 virtual programs. Each of these events featured paid speakers and provided food for the viewers, a practice that extended into the subsequent months. For instance, in May 2020, 14 virtual programs were held over 15 available evenings, and in June, the representative exceeded the number of possible evenings, hosting 22 programs in just 18 evenings. This pattern continued with 18 programs scheduled across all 18 available evenings in July 2020.

These figures raise significant concerns regarding the realistic ability to garner sufficient and appropriate attendance for each event, especially when no new information about the drug Nurtec ODT was being presented and in the middle of a pandemic. The frequency of these events, coupled with their consistent execution despite potential attendee fatigue, suggests that the primary motive was not educational enrichment. Instead, it appears that these programs were systematically used to provide financial incentives to top prescribers under the guise of education, highlighting a deliberate disregard for the quality and educational impact of the sessions. This scenario supports the relator’s allegations that Biohaven’s primary concern was to incentivize prescriptions of Nurtec ODT, rather than disseminate valuable medical knowledge.

Legal and Ethical Implications

This settlement underscores the importance of compliance with the Anti-Kickback Statute and the necessity for pharmaceutical companies to maintain rigorous controls over their marketing practices, particularly in the engagement of healthcare providers. The Office of Inspector General (OIG) has previously expressed skepticism about the educational value of such speaker programs, suggesting they may serve more as inducement vehicles than educational endeavors.

Settlement and Compliance Measures

Under the settlement terms, Pfizer/Biohaven will pay $60 million to resolve the claims without admitting wrongdoing. This case serves as a critical reminder for the pharmaceutical industry of the need for stringent oversight and the reevaluation of speaker program formats, particularly those conducted virtually.  It also serves as a warning to companies to devote resources to a detailed compliance review including the candidates Open Payments reporting during the due diligence process.

Conclusion

The Biohaven settlement serves as a significant compliance warning to the pharmaceutical industry, reminding companies of the evolving nature of regulatory expectations, especially in a digitally interconnected world. It highlights the necessity for companies to ensure that their operations not only meet legal requirements but also genuinely contribute to medical education without crossing into unethical territories.

Additional Resources

DOJ Biohave Settlement

DOJ Biohaven Settlement press release

Biohaven Complaint 8-18-21

Biohaven Open Payments Reporting 8-18-2021

Anti-Kickback StatuteBiohavenCMS Open PaymentsDepartment of JusticeDOJFalse Claims Acthealthcare fraudHealthcare Speaker ProgramsLegal SettlementsNEWNurtec ODTPfizerpharmaceutical compliancepharmaceutical ethics
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