The Biogen pharmaceutical company on Thursday agreed to pay $22 million to resolve allegations that it illegally paid insurance co-payments for thousands of patients in order to collect Medicare revenue, federal prosecutors said.
The company was accused of channeling money through two nonprofit foundations to cover co-payments for patients who were using Biogen drugs used to treat multiple sclerosis.
Prosecutors said Biogen identified patients who were in its free drug program for low-income patients but were eligible for Medicare benefits. Biogen then conspired with a pharmacy company to get those patients' drug costs claimed through Medicare, and one of the nonprofit foundations covered the co-payments with money from Biogen, prosecutors said.
The pharmacy company that worked with Biogen, Advanced Care Scripts, agreed to a $1.4 million settlement.
Federal prosecutors said the scheme violated a federal law that forbids pharmaceutical companies from offering financial incentives to induce Medicare patients to use their drugs.
“By using co-pay foundations this way — as a conduit to pay for co-pays for Biogen patients — Biogen violated the anti-kickback statute and undermined Medicare’s co-pay structure,” First Assistant U.S. Attorney Nathaniel Mendell said in a statement.
Biogen denies wrongdoing and said the payments were legitimate donations.
“Biogen continues to believe that independent charitable assistance programs help patients lead healthier lives,” Biogen said in a statement. “Donations to these organizations provide significant assistance to patients with their copayments for prescriptions.”