Over the past year, the United States Department of Justice (DOJ) has dramatically stepped up its efforts in investigating and prosecuting violations of the Federal False Claims Act. As part of this trend, the DOJ has recently begun stepping up its use of Civil Investigative Demands (CIDs) as one of its primary investigative tools in its campaign against violations of the False Claims Act. False Claims Act investigations and CIDs have been directed towards healthcare providers of all kinds, but within the pharmacy space, have tended to focus on compound medications billed to Tricare and other Federal payors. Since the beginning of this year, these CIDs have been served upon hundreds of pharmacies and healthcare entities nationwide, and the DOJ only shows signs of increasing this trend.
Each CID (which is issued by a particular office of the U.S. Attorney General) may request that its recipient produce to the DOJ documents, written interrogatories, oral testimony, or a combination thereof, such that a CID has the potential to be far more expansive than a subpoena.
In order for the government to issue a CID, the government need only have “reason to believe” that a recipient is in possession, custody, or control of information related to a violation of the False Claims Act. Considering the severity associated with receipt of a CID as well as the complexity that accompanies the related production, the government’s burden of proof to issue CIDs is extraordinarily low, making it extremely easy to meet.
Responding to a CID involves compiling massive amounts of documents and information, and for pharmacies, includes prescription records, pharmacy communications, and third party contracts, which must not only be collected, but also reviewed for responsiveness and privilege, before being produced to the government. This task can be daunting, and without the help of experienced professionals, has the potential to be perilous depending on the information requested and the nature of the production. Moreover, information produced pursuant to a CID is not limited to the investigation at hand; rather, it can be used in both parallel and subsequent investigations and may even be extended to spearhead or supplement criminal investigations.
Given these considerations, it is imperative that pharmacies and other healthcare companies in receipt of CIDs contact legal counsel immediately. Experienced counsel can assist a provider in reviewing and providing responsive documents, and effectively communicating with U.S. Attorneys’ offices. Moreover, even if your pharmacy or practice has not yet received a CID, you may benefit from conducting a detailed internal assessment and proactively communicating with the government about any irregularities or issues that have been uncovered. Frier Levitt is well versed in representing pharmacies, both compound and retail, who find themselves subjects of governmental investigations, and can also assist your pharmacy in conducting self-reviews to maintain compliance and decrease exposure. Contact Frier Levitt today for assistance in responding to Civil Investigative Demands.
