Psychology of Success

Pills, Capsules, and Kickbacks: Drug Manufacturer Pays $125 Million. Execs and Docs Headed to Jail

November 2, 2015

I know. In light of tons of illegal profits, complying with the federal anti-kickback law (“AKS”) is a hard sell.

But, it’s easier than a prison cell. And better than paying a $125 million fine.

The U.S. sales arm of pharmaceutical manufacturer Warner Chilcott agreed last week to plead guilty to felony charges of health care fraud including violation of the AKS. To resolve both criminal and civil liability, the company is paying $125 million.

Several individual defendants have plead out, too. Others, including the company’s former president as well as a physician who received remuneration from Warner Chilcott have been indicted. They’re looking at significant jail time.

Warner Chilcott plead guilty to paying kickbacks to doctors to encourage them to prescribe its medications. Those payments were in connection with “medical education events” and speaker programs. Held at expensive restaurants, the programs involved little or no actual education. Paid speakers often didn’t speak about any clinical or scientific topics, but were paid from $600 to $1,200 for each presentation. According to the government’s allegations, the company told some speakers they would not be paid for additional events unless they prescribed more medication.

Things For You To Think About

If you were plumbers, not physicians or pharmacists or physical therapists, there’d be nothing wrong with a plumbing fixture manufacturer taking you out to dinner at Chez Milliard Euros or paying you $600 to speak for five minutes at a meeting.

But you’re not plumbers and we’re talking healthcare not hot tubs, so it could mean jail.

The time to analyze your “business opportunity” is not when you’re waiting for the bail bondsman or when you’re planning your defense. It’s upfront.

Sure, you might be out $1,200 for a speech consisting of “thank you very much,” or still hankering for a bottle of Chateau Lafitte 1982. But you won’t have to be worrying about doing jail time, paying astronomical fines, or losing your medical license.

Comment or contact me if you’d like to discuss this post.

Mark F. Weiss

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