Galena Biopharma Agrees to Pay Over $7.55 million to the United States to Resolve TIRF REMS Kickback Allegations

Pharmaceutical manufacturer Galena Biopharma Inc. (Galena) has agreed to pay more than $7.55 million to resolve Civil False Claims Act allegations that they paid doctors kickbacks in order to induce them to prescribe its fentanyl-based drug Abstral.

Based on a lawsuit filed by a whistleblower, the United States alleged that Galena paid multiple forms of kickbacks to doctors in order to get them to prescribe Abstral, a sublingual fentanyl tablet in the TIRF REMS program. The alleged kickbacks included providing more than 85 free meals to doctors and staff of a single, high-prescribing practice; paying doctors $5,000, and speakers $6,000, plus expenses, to attend an advisory board that was partly planned and attended by Galena sales team members; and paying approximately $92,000 to a physician-owned pharmacy under a performance-based rebate agreement to induce the owners to prescribe Abstral. The United States also alleged that Galena paid doctors to refer patients to the company’s RELIEF patient registry study, which was nominally designed to collect data on patient experiences with Abstral, but acted as a means to induce the doctors to prescribe Abstral.

Two of the doctors who received kickback payments from Galena were tried, convicted, and later received lengthy prison sentences following a jury trial of, among other counts, offenses related to the prescriptions of Abstral.

The Transmucosal Immediate Release Fentanyl (TIRF) Risk Evaluation and Mitigation Strategy (REMS) program was designed for certain oral fentanyl products to ensure informed risk-benefit decisions are made before starting a patient on one of the products. TIRF REMS products, along with other opioids, have been a distinct focus of the government in recent months, and the trend is likely not to subside anytime soon. For instance, Insys Therapeutics, another pharmaceutical manufacturer of TIRF REMS products, is the subject of an expansive government investigation involving allegations of kickbacks paid to prescribers of their TIRF REMS product, Subsys.

The United States continues to aggressively investigate and act upon health care arrangements involving potential kickback schemes and opioids. The United States aggressive stance and actions will likely continue into the foreseeable future. Furthermore, the penalties are severe, reaching as far as criminal liability for Kickback violations. If your pharmacy is considering entering into an arrangement or agreement with a pharmaceutical manufacturer, it is imperative that you consult with an experienced health care attorney in order to avoid the potential pitfalls. Frier Levitt reviews and opines on arrangements between pharmacies and pharmaceutical manufacturers, including performance based rebate agreements. Moreover, if your pharmacy is currently dispensing opioids, it is imperative that the pharmacy is following best practices when dispensing opioids. Frier Levitt conducts pharmacy operational compliance reviews and structures compliance programs for pharmacies, including policies and procedures related to opioid dispensing. Contact Frier Levitt today to speak to an attorney.

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