Sanofi-Aventis U.S. (Sanofi) on Feb. 28 agreed to pay $11.85 million to resolve allegations that it violated the False Claims Act by paying kickbacks to Medicare patients through The Assistance Fund (TAF), an allegedly independent charitable foundation claiming 501(c)(3) status that provides co-pay assistance to patients.
TAF operates funds that pay the co-pays of certain Medicare patients with Multiple Sclerosis (MS), some of whom were prescribed Lemtrada, Sanofi’s MS drug. The nearly $100,000 per-patient per-year cost of Lemtrada often presents significant barriers to access for Medicare patients, who may have co-pays in the thousands of dollars per year.
In part due to the high cost of Lemtrada, TAF’s MS fund frequently ran out of funding and would close to new patients. TAF did not maintain a waiting list of patients who applied for co-pay assistance when the MS fund was closed. As a result, whenever TAF’s MS fund reopened to new patients, grants went to the patients who applied immediately after the opening, and not to the patients who had sought to apply at an earlier time when the fund was closed.
The United States alleged that Sanofi violated the Anti-Kickback Statute by making payments to TAF with the intention of using TAF as a conduit to pay the financial obligations, including Medicare co-pay obligations, of patients taking Lemtrada. To do this, Sanofi worked to identify Medicare patients who had been prescribed Lemtrada but who had not yet received infusions due to their inability to afford the co-pays. Knowing that TAF would fund the first patients who applied after the fund reopened, Sanofi made eight of its nine payments when the fund was closed, allowing it to reopen to new patients, and subsequently instructed its hub to quickly refer as many Lemtrada patients as possible to the fund. As a result, when the MS fund reopened with Sanofi’s funding, Lemtrada patients received a disproportionately larger share of the Medicare co-pay grants that TAF issued and patients taking other MS drugs received a disproportionately small share of the Medicare co-pay grants TAF issued.
Scope of Settlement
In addition to the monetary settlements, Sanofi entered into a Corporate Integrity Agreement (CIA) with OIG. This CIA requires Sanofi to implement policies and training programs to ensure its arrangements and interactions with third-party patient assistance programs are in compliance with the law. The CIA also requires Sanofi to engage an independent review organization to conduct assessments and requires compliance-related certifications from company executives and the board of directors.