[e-drug] Fraud by Abbott and Takeda (cont'd)

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E-drug: Fraud by Abbott and Takeda (cont'd)
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[Copied as fair use. HH]

BMJ 2001;323:828 (13 October 2001)

Drug companies defrauded Medicare of millions 
Fred Charatan, Florida 

A joint venture of Takeda Chemical Industries and Abbott
Laboratories TAP Pharmaceutical Products has agreed to pay
$875m (?583) to settle criminal and civil charges that it had
illegally manipulated the Medicare and Medicaid programmes. 

The settlement tops the $840m paid by the healthcare company
HCA for fraud (BMJ 2001;322:10). Federal prosecutors said that
sales representatives from TAP gave doctors free samples of
leuprorelin acetate (marketed as Lupron in the United States and
Prostap in the United Kingdom), which is used to treat prostate
cancer and infertility. The representatives then helped them to get
government reimbursements at hundreds of dollars for each dose
injected.

Employees of TAP were charged with giving kickbacks trips to
resorts, medical equipment, and "educational grant" payments to
doctors if they prescribed leuprorelin. 

The investigation began four years ago when Douglas Durand, a
former vice president for sales at TAP, and Dr Joseph Gerstein, a
urologist employed by Tufts Associated Health Maintenance
Organisation in Waltham, Massachusetts, separately told federal
officials about what they believed were illegal sales practices by
TAP. Dr Gerstein said that TAP sales representatives offered him an
unrestricted $65000 in grants if he would reverse his decision to
have his health maintenance organisation use only goserelin acetate
(Zoladex), a less expensive drug that competes with leuprorelin. 

Medicare now covers a very limited number of drugs. Most of them,
like leuprorelin, must be administered by a doctor. Drug companies
supply doctors with drugs to give to Medicare patients, and
Medicare then repays the doctors based on a price provided by the
companies called the "average wholesale price." 

Thomas Watkins, the president of TAP, admitted that it provided
free samples of leuprorelin to some doctors in the first half of the
1990s, knowing that the doctors would seek reimbursement from
the federal government. 

"The billing for free samples is wrong, and it should never have
happened," Mr Watkins said. "We have taken strong action so that
this inappropriate marketing practice will never happen again." 

Michael Sullivan, the US attorney for Massachusetts said that the
settlement and indictments sent "a very strong signal to the
pharmaceutical industry." He said, "These types of behaviour are
not tolerated and are going to be investigated, even if it takes four
and a half years to bring to conclusion." 

The government has also charged five doctors with healthcare fraud
in the case. Federal prosecutors said that those doctors had
conspired with the company to receive excessive Medicare
reimbursements. Four pleaded guilty, and the fifth was recently
indicted. 


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