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Pharmacy Alert: Recent Uptick in Federal Investigations Against Pharmacies

According to recent statistics released by the Department of Justice (DOJ), federal government enforcement actions targeting the health care and pharmaceutical industries have risen over the past year by about 5%. In 2019, the DOJ brought in over $3 billion in judgments and settlements under the False Claims Act (FCA), with $2.6 billion stemming from health care and life sciences companies such as hospitals, drug manufacturers and pharmacies. In addition, in 2019, the government saw 633 new qui tams whistleblower suits, with the DOJ filing 146 FCA suits on its own. Two of the largest settlements last year were the $500 million settlement with drug-maker Reckitt Benckiser Group PLC, and the $21 million settlement with Patient Care America, a compounding pharmacy that allegedly orchestrated a $70 million kickback scheme in violation of the Anti-Kickback Statute (AKS). Notably, the settlement with Patient Care America involved private equity owners, marking the first time the government has intervened in an FCA suit against a private equity firm.

2020 may see a similar rise in federal investigations and prosecutions, especially geared towards healthcare professionals, pharmacies and pharmacists. If you are in the healthcare industry, you need to take steps to minimize risk by implementing sound policies and procedures geared towards preventing any potential violations of state and federal law. The risks associated with federal investigations and prosecutions could be severe and include high attorneys’ fees, being placed on the OIG exclusion list and potential damages and penalties. In addition, healthcare professionals and pharmacists who are currently under federal investigation should retain skilled and experienced counsel.

How Frier Levitt Can Help
At Frier Levitt, we have a great deal of experience counseling clients on matters such as government investigations, FCA prosecutions and violations of the AKS. We have also assisted pharmacies in implementing various policies and procedures regarding marketing, copayment collection and prescription dispensing. Contact Frier Levitt today to learn more.