OIG Increasing Scrutiny of Speaker Programs that Violate the Anti-Kickback Statute

In November 2020, the U.S. Department of Health & Human Services, Office of Inspector General (the “OIG”) issued a Special Fraud Alert to highlight the fraud and abuse risks associated with pharmaceutical and medical device company speaker programs. Speaker programs are company-sponsored events at which a physician or other health care professional (“HCP”) makes a speech or presentation to HCP attendees about a drug, device, product, or disease state on behalf of the pharmaceutical or medical device company. The HCP speaker typically receives compensation from the company and the HCP attendees often receive remuneration from the company in the form of free meals, beverages, and other perks. The OIG has made it clear that this type of arrangement, if not executed compliantly, implicates the federal Anti-Kickback Statute (the “AKS”). Previous OIG investigations have revealed that companies often organize and pay for speaker programs with the intent to induce HCPs to prescribe or order the companies’ products in violation of the AKS.

The AKS makes it a criminal offense to knowingly and willfully solicit, receive, offer, or pay any remuneration to induce or reward referrals for, or orders of, items or services reimbursable by a Federal health care program. The AKS defines remuneration broadly, and can encompass anything of value, where the offer, payment, or receipt of which may be made directly or indirectly, overtly or covertly, in cash or in kind.

As evidenced by this alert, all parties involved in speaker programs, including drug or device companies, HCP speakers, and HCP attendees, will likely be subject to increased scrutiny in the new year. The OIG provided the following non-exhaustive list of speaker program characteristics, which, taken separately or together, potentially indicate a violation of the AKS:

  • The company sponsors speaker programs where little or no substantive information is actually presented;
  • Alcohol is available or a meal exceeding modest value is provided to the attendees of the program (the concern is heightened when the alcohol is free);
  • The program is held at a location that is not conducive to the exchange of educational information (e.g., restaurants or entertainment or sports venues);
  • The company sponsors a large number of programs on the same or substantially the same topic or product, especially in situations involving no recent substantive change in relevant information;
  • There has been a significant period of time with no new medical or scientific information nor a new FDA-approved or cleared indication for the product; HCPs attend programs on the same or substantially the same topics more than once (as either a repeat attendee or as an attendee after being a speaker on the same or substantially the same topic);
  • Attendees include individuals who do not have a legitimate business reason to attend the program, including, for example, friends, significant others, or family members of the speaker or HCP attendee; employees or medical professionals who are members of the speaker’s own medical practice; staff of facilities for which the speaker is a medical director; and other individuals with no use for the information;
  • The company’s sales or marketing business units influence the selection of speakers or the company selects HCP speakers or attendees based on past or expected revenue that the speakers or attendees have or will generate by prescribing or ordering the company’s product(s) (e.g., a return on investment analysis is considered in identifying participants); and
  • The company pays HCP speakers more than fair market value for the speaking service or pays compensation that takes into account the volume or value of past business generated or potential future business generated by the HCPs.

How Frier Levitt Can Help

In light of the foregoing, drug and device companies interested in hosting speaker programs and HCPs interested in speaking at or attending speaker programs must consider all associated risks and be prepared to justify their action. While the OIG has put companies and HCPs on notice of its concerns about speaker programs, it has also provided a framework that HCPs as well as pharmaceutical and medical device companies should follow to guard against liability. Given the OIG’s stated skepticism with respect to these programs, proper work in ensuring a compliant arrangement on the front end may save companies and HCPs enormous costs. Frier Levitt routinely represents healthcare and life sciences companies in developing legally sound speaker programs. Contact Frier Levitt today to speak to an attorney.

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