What I Learned from a Federal Prosecutor Law Seminar: Pharmacies Under the Microscope in 2018 – Opioid Prescribing and Beyond

During a recent seminar on Federal and State Enforcement Priorities in 2018, Assistant United States Attorneys from the Eastern District of Pennsylvania spoke about the heightened criminal and civil scrutiny on pharmacies in the Commonwealth of Pennsylvania. Regarding the cause celebre – opioid prescribing – the focus will expand from the physician prescribers to the pharmacists and pharmacies. Opioid compliance plans will be essential for pharmacies to avoid criminal prosecution and limit any exposure to the civil arena, both commercial and federal healthcare programs.

Separate from opioid compliance, another area of focus will be kickbacks and other illegal financial relationships between providers and other stakeholders, such as pharmacies, laboratories and landlords. The federal government is focusing on violations of state insurance fraud laws prohibiting financial inducements for referrals and failures to comply with state licensing requirements. Every transaction between a pharmacy and a manufacturer, HUB, telemedicine company, landlord, marketing company and the like, must be carefully vetted by competent healthcare counsel.

Lastly, compound pharmacies were specifically brought up as a target of increased enforcement and scrutiny. In 2017, the Eastern District of Pennsylvania secured a number of convictions and False Claims Act settlements related to the “lack of medical necessity” arising from compounds. Given the increased costs of compound drugs compared to generic or brand named commercially available drugs, the federal government has continued to target compound pharmacies. It is important for every compound pharmacy that has any marketing relationships or contract with a drug manufacturer or HUB to have the agreement reviewed and vetted by healthcare counsel to ensure no violation of the Anti-Kickback Statute, False Claims Act and/or other federal and state laws and regulations.

While the increased focus on pharmacies in 2018 may seem alarming, with the right compliance plan and vetted marketing strategies potential risks can be substantially mitigated. Contact Frier Levitt to speak to an attorney.